On Deferred Indefeasibility: DAWALING SUMAIL vs.

HONORABLE JUDGE OF THE COURT OF FIRST INSTANCE OF COTABATO, THE DIRECTOR OF LANDS and MELQUIADES GEPULIANO G.R. No. L-8278 April 30, 1955 Facts: Herein private respondent Gepuliano had filed a free patent application for a parcel of land, which was approved and was finally issued to him on September 26, 1949. The Patent was registered in the office of Register of Deeds (RD), which office thereafter issued to him Original Certificate of Title (OCT). Consequently, herein petitioner filed a civil case for the cancellation of the OCT issued to Gepuliano, alleging that the latter thru fraud and misrepresentation had filed with the Bureau of Lands a falsified application for free patent for the lot, stating in his application that the parcel was not occupied or claimed by any other person and that he had entered upon it and introduced improvements thereon, when as a matter of fact, Gepuliano had never occupied the land nor introduced improvements thereon, and that it was him who had been in possession since shortly before the end of the Spanish regime and that the Director of Lands through mistake or inadvertence had approved the application and later issued Free Patent. The Court issued an order stating that the subject lot was public land; that it was applied for free patent by Gepuliano and the corresponding Patent had been issued to him; that it does not appear from the complaint of Sumail that he had exhausted all the remedies available to him such as an appeal to the Secretary of the Department, and that the courts will not interfere with the administrator by the Bureau of Lands of the public domain. Hence, this petition. Issue: Whether Sumalis action is proper Held: No In ordinary registration proceedings involving private lands, courts may reopen proceedings already closed by final decision or decree, only when application for review is filed by the party aggrieved within one year from the issuance of the decree of registration. Here, there was no decree of registration because instead of an application for registration under the Land Registration Act Gepuliano applied for free patent under the Public Land Act. Assuming that even in bringing public land grants under the Land Registration Law, there is a period of one year for review in cases of fraud, how shall that period of one year be computed? o For all practical purposes we might regard the date of the issuance of the patent as corresponding to the date of the issuance of the decree in ordinary registration cases, because the decree finally awards the land applied for registration to the party entitled to it, and the patent issued by the Director of Lands equally and finally grants, awards, and conveys the land applied for to the applicant. The purpose and affect of both decree and patent is the same. o Assuming the Civil Case filed by Sumail was intended as a petition for review of the public land grant and conveyance to Gepuliano, on the ground of fraud, was it filed within the period of one year? No. It was only filed on July 21, 1952, or almost 3 years after the issuance of the free patent. It is, therefore, clear that the trial court no longer had jurisdiction to entertain the complaint for the reasons already state, but not as contended by the Director of Lands that it involved public land, over which he had exclusive and executive control, because once the patent was granted and the corresponding certificate of title was issued, the land ceased to be part of the public domain and became private property over which the Director of Lands has neither control nor jurisdiction. If Sumalis action will be regarded as an action for reversion to the Government of the lot in litigation, under the provisions of sections 91 and 124 of the Public Land Act, which provide for the annulment of patents and titles previously issued, and the reversion of the lands covered by them to the state, may he bring said action may he bring such action? o No. Section 101 of the Public Land Act provides that all actions for the reversion to the Government of Lands of the public domain or improvements thereon shall be instituted by the Solicitor General or the officer acting in his stead, in the proper courts, in the name of the Republic of the Philippines. Case Digest in Land Titles and Deeds Rivad, Sherine L., 2011 0007 1stSem AY 2013-2014, Arellano University School of Law

On Prescription of Action for Reconveyance based on Fraud: EMILIANO S. CASIPIT and ANTONIA C. CASIPIT VDA. DE BEATO vs. HON. COURT OF APPEALS et. al. G.R. No. 96829 December 9, 1991 Facts: On April 1987, a complaint was filed by herein petitioners against private respondents mainly for the recovery of a property, alleging that Emiliano Casipit is the true and lawful owner of the questioned property located at Sinalhan, Sta. Rosa, Laguna by virtue of continuous, uninterrupted, peaceful, open and public possession in the concept of owner since 1930; that they were deprived of ownership thereof by the Beatos through Narciso Beato, who filed a Petition for Reconstitution of Titles in the name of Gabriel Beato, using fictitious documents. Petitioners therefore prayed that TCT and other succeeding titles be cancelled, as well as the tax declarations; that the questioned property be reconveyed to them; that the document entitled, "Kasulatan ng Pagmamana at Paghahati," insofar as it included the questioned property be rescinded; and that private respondents be ordered to pay damages and attorney's fees. The lower court dismissed the petition, holding that the defendants have a better right than the plaintiffs, that the cause of action of the plaintiffs being based on fraud, has prescribed for it must be filed within 4 years after the cause of action arose. The issuance of the reconstituted title over the subject lot and its registration in the office of the Register of Deeds of Laguna, in 1963 is the starling date for the prescriptive period to commence. The respondent court affirmed the said decision and denied petitioners motion for reconsideration, hence, this petition. Petitioners Contention: pursuant to the Certification issued by the Bureau of Lands that Patent over the questioned property has not been issued to Gabriel Beato, the "Kasulatan ng Pagmamana at Paghahati" is therefore a void contract. This being the case, the action taken by petitioners is imprescriptible. Private respondents Diaz spouses were buyers in bad faith because they had full knowledge that Emiliano Casipit has been in actual possession in the concept of owner of the questioned property and paid the real property taxes thereon. Issue: Whether petitioners action already prescribed Held: Yes There is no dispute that an action for reconveyance based on a void contract is imprescriptible. However, this is not the case at bar. The action filed by petitioner before the trial court was 1) for reconveyance based on fraud since the ownership of private respondents over the questioned property was allegedly established on "false assertions, misrepresentations and deceptive allegations"; and 2) for rescission of the "Kasulatan ng Pagmamana at Paghahati. Thus, the action for reconveyance based on fraud filed by petitioners before the trial court is subject to prescription. Based on jurisprudence, the prescriptive period for the reconveyance of fraudulently registered real property is 10 years reckoned from the date of the issuance of the certificate of title. o Conformably with these settled jurisprudence, the prescriptive period for petitioners' action for reconveyance is 10 years from August 30, 1963, the date of the issuance of TCT in favor of Beato. Obviously, the discussion on this subject matter is not beneficial to petitioners because they filed the action for reconveyance only on April 27, 1987. Hence, petition was dismissed. On Prescription of Action for Reconveyance based on Void Contract: SOLID STATE MULTI-PRODUCTS CORPORATION vs. THE COURT OF APPEALS and THE INTESTATE ESTATE OF ANTENOR S. VIRATA and the DBP G.R. No. 83383 May 6, 1991 Facts: Petitioner, a domestic corporation, filed an action for quieting of title against the respondent estate of Virata alleging that it is the registered owner of a parcel of land (a friar land) located at Imus, Cavite, which was covered by a Certificate of Title issued on February 24, 1976; that Virata, during his lifetime thru the use of fraud, caused the issuance of Certificate of Title on September 1, 1959 thru an administrative reconstitution of a nonexistent original title covering the same parcel of land; that by reason of the said reconstitution and subsequent issuance of TCT, there now exists a cloud on the title of petitioner. On the other hand, respondent Virata denied the allegations in the complaint, contending that his predecessor, one Mabini Legaspi, bought the subject property through a public bidding, wherein consequently, a TCT was issued in his name, and that subsequently a deed of sale was executed in favor of Virata. Such deed was then registered with the Register of Deeds, who later on issued a TCT to Virata. However, the Provincial Capitol building of Cavite which housed 1

the Registry of Deeds was burned, destroying land records and titles in d registry among which were the records relating to the subject property. Hence, the RD administratively reconstituted the original TCT based on owner's duplicate certificate. Issue: Whether petitioners contention is meritorious Held: Yes Sale of the subject land to Mabini Legaspi, respondents predecessor is void o There was neither allegation nor proof that the sale was with the approval of the Secretary of Agriculture and Commerce. The absence of such approval made the supposed sale null and void ab initio. o Without the certificate of sale to prove the transfer of the ownership of the land from the government Mabini Legaspi and without the required approval of the sale by the Secretary of Agriculture and Commerce, he did not in any manner acquire ownership over the land in 1943. o The ownership or title over the subject land remained in the government until Pearanda, petitioners predecessor, lawfully acquired ownership over the same lot on February 28, 1969 by virtue of a sales contract executed in his favor. The issuance of a certificate of title in favor of Mabini Legaspi did not vest ownership upon respondent over the land nor did it validate the alleged purchase of the lot, which is null and void. Time and again, it has been held that registration does not vest title. It is merely evidence of such title over a particular property. Our land registration laws do not give the holder any better title than that what he actually has Did petitioners action prescribe? NO o Although a period of one year has already expired from the time the certificate of title was issued to Mabini Legaspi pursuant to the alleged sale from the government, said title does not become incontrovertible but is null and void since the acquisition of the property was in violation of law. o Further, the petitioner herein is in possession of the land in dispute. Hence, its action to quiet title is imprescriptible. On Prescription of Action for Reconveyance Action to Quiet Title: JULIANA CARAGAY-LAYNO, Assisted by Her Husband, BENITO LAYNO vs. HONORABLE COURT OF APPEALS and SALVADOR ESTRADA G.R. No. L-52064 December 26, 1984 Facts: Herein petitioner and Mariano De Vera were first cousins. When De Vera died, his widow and later on his nephew, herein private respondent, became the administrator of his land property covered by an original certificate of title. When an inventory was conducted on all properties of De Vera, a discrepancy between the title and inventory was found. Such land discrepancy was occupied by herein petitioner. Consequently, Estrada instituted suit against petitioner for recovery of the Disputed Portion, which she resisted, mainly on the ground that the Disputed Portion had been fraudulently or mistakenly included in the OCT, so that an implied or constructive trust existed in her favor. She then counterclaimed for reconveyance of property in the sense that title be issued in her favor. The Court held that petitioners action for reconveyance based on implied or constructive trust has prescribed after 10 years, i.e. the subject land was registered on September 1947 while petitioners action only commence on March 1967. Issue: Whether petitioners action already prescribed Held: No The evidence discloses that petitioner, and his farther, had been in actual open, continuous and uninterrupted possession of the disputed portion in the concept of owner for about 45 years, until said possession was disturbed in 1966 when Estrada informed petitioner that the Disputed Portion was registered in Mariano DE VERA's name. To substantiate her claim for fraud, petitioner declared that during his lifetime, DE VERA, her first cousin, borrowed from her the Tax Declaration of her land purportedly to be used as collateral for his loan and sugar quota application; that relying on her cousin's assurances, she acceded to his request and was made to sign some Case Digest in Land Titles and Deeds Rivad, Sherine L., 2011 0007 1stSem AY 2013-2014, Arellano University School of Law

documents the contents of which she did not even know because of her ignorance Of significance is the fact, as disclosed by the evidence, that for 20 years from the date of registration of title in 1947 up to 1967 when this suit for recovery of possession was instituted, neither the deceased DE VERA up to the time of his death in 1951, nor his successors-in-interest, had taken steps to possess or lay adverse claim to the Disputed Portion. They may, therefore be said to be guilty of laches as would effectively derail their cause of action. Administrator ESTRADA took interest in recovering the said portion only when he noticed the discrepancy in areas in the Inventory of Property and in the title. The foregoing conclusion does not necessarily wreak havoc on the indefeasibility of a Torrens title. For, mere possession of a certificate of title under the Torrens System is not conclusive as to the holder's true ownership of all the property described therein for he does not by virtue of said certificate alone become the owner of the land illegally included. A Land Registration Court has no jurisdiction to decree a lot to persons who have never asserted any right of ownership over it. Petitioner, whose property had been wrongfully registered in the name of another, but which had not yet passed into the hands of third parties, can properly seek its reconveyance. Prescription cannot be invoked against petitioner for the reason that as lawful possessor and owner of the Disputed Portion, her cause of action for reconveyance which, in effect, seeks to quiet title to the property, falls within settled jurisprudence that an action to quiet title to property in one's possession is imprescriptible. o Her undisturbed possession over a period of 52 years gave her a continuing right to seek the aid of a Court of equity to determine the nature of the adverse claim of a third party and the effect on her own title. Under the circumstances, petitioner's right to quiet title, to seek reconveyance, and to annul the title accrued only when she was made aware of a claim adverse to her own. It was only then that the statutory period of prescription may be said to have commenced to run against her. Hence, petition was granted.

On Prescription of Action for Reconveyance Res Judicata: HEIRS OF TRINIDAD DE LEON VDA. DE ROXAS vs. COURT OF APPEALS and MAGUESUN MANAGEMENT AND DEVELOPMENT CORPORATION G.R. No. 138660 February 5, 2004 Facts: A petition to set aside the decree of registration over two unregistered parcels of land in Tagaytay City granted to corporation respondent before the RTC on the ground of actual fraud was filed by Trinidad de Leon Vda. De Roxas. This was granted by the Supreme Court, on appeal (in a previous case). Subsequently, Meycauyan filed a petition to intervene in the said case, alleging that it purchased three parcels of land from Maguesun which form part of the property awarded to the heirs of Roxas and that since it is a purchaser in good faith and for value, the Court should afford it the opportunity to be heard, that the adverse decision in the previous case cannot impair its rights as a purchaser in good faith and for value. This was denied. The heirs of Roxas then filed a Motion for Issuance of Writ of Possession with the land registration court, after their motion for clarification was granted. Meycauayan filed a Complaint for reconveyance, damages and quieting of title with the trial court. Such complaint is almost an exact reproduction of the Petition for Intervention filed by Meycauyan. Consequently, the trial court dismissed for lack of merit Meycauayan's complaint for reconveyance, damages and quieting of title, holding that the nullity of the OCT of Maguesun where Meycauyan is not a party in the suit and which is the source of Meycauayan's title, is now res judicata. Issue: Whether Meycauyans action for reconveyance, damages and quieting of title can be validly tried by the court Held: No Courts will simply refuse to reopen what has been decided. They will not allow the same parties or their privies to litigate anew a question, once it has been considered and decided with finality. Litigations must end and terminate sometime and somewhere. The effective and efficient administration of justice requires that once a judgment has become final, the prevailing party should not be deprived of the fruits of the verdict by subsequent suits on the same issues filed by the same parties. This is in accordance with the doctrine of res judicata which has the following elements: (1) the former judgment must be final; (2) the court which rendered it had jurisdiction over the subject matter and 2

the parties; (3) the judgment must be on the merits; and (4) there must be between the first and the second actions, identity of parties, subject matter and causes of action. The application of the doctrine of res judicata does not require absolute identity of parties but merely substantial identity of parties. o There is substantial identity of parties when there is community of interest or privity of interest between a party in the first and a party in the second case even if the first case did not implead the latter. The Court ruled in the previous case that Meycauayan's predecessorin-interest, Maguesun, committed actual fraud in obtaining the decree of registration of the subject properties. The decision is such case binds Meycauayan under the principle of "privity of interest" since it was a successor-in-interest of Maguesun.

Exception to Curtain Principle: Caveat Emptor on Mortgage of Real Property: SOCORRO COSTA CRISOSTOMO vs. COURT OF APPEALS and NORMA SAN JOSE, DIANA J. TORRES G.R. Nos. 91383-84 May 31, 1991 Facts: Petitioner was the registered owner of a residential house and lot, located in Mandaluyong and covered by a TCT. She has occupied the property ever since she had her house built and has introduced other improvements thereon. Later on, private respondent Norma San Jose offered to buy the property, which was accepted by petitioner, payment of which shall come from proceeds of a loan by San Jose using petitioners title as collateral but she issued postdated checks to petitioner. On San Joses request, another deed of sale was executed over the same property, which was then registered, such that petitioners TCT was cancelled and a new TCT was issued. Because of unfulfilled promises to make good the postdated checks, petitioner demanded San Jose for the return of the title. However, the latter informed that the title was in the possession of Diana J. Torres, the mortgagee. San Jose never returned the said title as she had promised nor did she ever make any payment to the petitioner. Issue: Whether respondent Torres is a mortgagee in good faith Held: No There are strong indications that Atty. Flor Martinez, the lawyer of Diana J. Torres, the mortgagee, knew of the defect of San Jose's title. When Atty. Martinez personally inspected the property with San Jose for her client Torres, she allowed herself to be introduced to Socorro Crisostomo who was then actually occupying the house, as a Bank Inspector of the Development Bank of Meycauayan, Bulacan from whom the loan was being obtained, obviously to convince Crisostomo that the procedure is in accordance with her agreement with San Jose. Finally, when Torres herself visited the property she carefully evaded seeing Crisostomo personally, the actual occupant thereof, who could have easily enlightened her as to the true owner Based on jurisprudence, a person dealing with registered land has a right to rely upon the fact of the Torrens Certificate of Title and to dispense with the need of inquiring further, except when the party concerned has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make further inquiries o Even assuming that Torres does not in fact know the circumstances of the sale, she is bound by the knowledge of Atty. Martinez or by the latter's negligence in her haphazard investigation because the negligence of her agents is her own negligence It is a well-settled rule that a purchaser or mortgagee cannot close his eyes to facts which should put a reasonable man upon his guard, and then claim that he acted in good faith under the belief that there was no defect in the title of the vendor or mortgagor. o His mere refusal to believe that such defect exists, or his willful closing of his eyes to the possibility of the existence of a defect in the vendor's or mortgagor's title, will not make him an innocent purchaser or mortgagee for value, if it afterwards develops that the title was in fact defective, and it appears that he had such notice of the defects as would have led to its discovery had he acted with the measure of precaution which may be required of a prudent man in a like situation

Exception to Curtain Principle: Caveat Emptor: JUAN DACASIN, JOSE, MARIA, SORAHAYDA, FLORDELIZA, and FILIPINAS MARAMBA vs. THE COURT OF APPEALS, FELIPE CAPUA, SINFOROSA PADILLA, GUALBERTO CALULOT and OLIMPIA LOMIBAO G.R. No. L-32723 October 28, 1977 Facts: A parcel of land situtated in the barrio of Patayac Municipality of Sta. Barbara, Pangasinan was being possessed by petitioner Jose Maramba, whose possession was subsequently grabbed by Sabina Capua. Maramba filed a civil case against Capua, but notwithstanding the same, the latter remained in possession and later on sold the property to Gualberto Calulot, herein one of the private respondents. The court ruled in favor of Maramba and ordered Capua to vacate and deliver the land to the former. Unfortunately, the decision was not executed within the reglementary period of 5 years from the time it had become final. Several years after, Calulot sold the subject land to respondent spouses Felipe Capua and Padilla, who possessed the same despite a writ of possession was executed in favor of Maramba. He then filed a case for revival of judgment which was granted by the court. Upon Marambas death, his heirs sold the property to petitioner Dacasin. Capua, together with Calulot, then filed an action against petitioners, praying that he be declared as the absolute owner of the subject property virtue of his purchase in good faith and by the continuous possession of his immediate predecessor-in-interest Gualberto Calulot. This was denied by the trial court, which was however reversed by CA, holding that Capua has squarely raised the question of his own title obtained thru acquisitive prescription; that it must have to be admitted that the property being unregistered, ownership therein could be defeated by acquisitive prescription. Issue: Whether the respondent court erred in its decision Held: Yes Jose Marambas filing of action against Sabina Capua, latters possession was thereby interrupted, hence, acquisitive prescription did not transpire. The facts are aundisputed that the deed of sale executed between Jose Maramba as vendee and Emiliana Abad as vendor in 1958 was duly registered in the Registry of Deeds as well as the deed of sale executed in 1929 between Emiliana Abad and the original owner Florentino Quinajon. Under the law, Article 709 of the New Civil Code, titles of ownership or of other rights over immovable property duly inscribed or annotated in the Registry of Property constitute notice to third persons and affords protection in favor of him who in good faith relies upon what appears in the registry. As between two parties relying on their respective instruments of sale of the same property, law and justice command that he who has registered his deed must prevail over his adversary who has not done so. The rule of caveat emptor requires the purchaser to be aware of the supposed title of the vendor and he who buys without checking the vendor's title takes all the risks and consequent to such failure. None of the deeds of sale evidencing the ownership of Gualberto Calulot and Felipe Capua were registered in the Registry of Property, hence they cannot prevail over the rights of the petitioner who holds in his favor the instrument of sale duly registered

Case Digest in Land Titles and Deeds Rivad, Sherine L., 2011 0007 1stSem AY 2013-2014, Arellano University School of Law