G.R. No.

183896

January 30, 2013

SYED

AZHAR

ABBAS, Petitioner,

vs.
GLORIA GOO-ABBAS, Respondent.
DECISION
VELASCO, JR., J.:
This is a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure, questioning the Decision1 of the Court of Appeals (CA) dated March 11, 2008 in CA-G.R.
CV No. 86760, which reversed the Decision2 in Civil Case No. 03-0382-CFM dated October 5, 2005 of the Regional Trial Court (RTC), Branch 109, Pasay City, and the CA Resolution
dated July 24, 2008, denying petitioners Motion for Reconsideration of the CA Decision.
The present case stems from a petition filed by petitioner Syed Azhar Abbas (Syed) for the declaration of nullity of his marriage to Gloria Goo-Abbas (Gloria) with the RTC of Pasay
City, docketed as Civil Case No. 03-0382-CFM, and raffled to RTC Branch 109. Syed alleged the absence of a marriage license, as provided for in Article 4, Chapter I, Title 1 of
Executive Order No. 269, otherwise known as the Family Code of the Philippines, as a ground for the annulment of his marriage to Gloria.
In the Marriage Contract3 of Gloria and Syed, it is stated that Marriage License No. 9969967, issued at Carmona, Cavite on January 8, 1993, was presented to the solemnizing officer.
It is this information that is crucial to the resolution of this case.
At the trial court, Syed, a Pakistani citizen, testified that he met Gloria, a Filipino citizen, in Taiwan in 1991, and they were married on August 9, 1992 at the Taipei Mosque in
Taiwan.4 He arrived in the Philippines in December of 1992. On January 9, 1993, at around 5 oclock in the afternoon, he was at his mother-in-laws residence, located at 2676 F.
Muoz St., Malate, Manila, when his mother-in-law arrived with two men. He testified that he was told that he was going to undergo some ceremony, one of the requirements for his stay
in the Philippines, but was not told of the nature of said ceremony. During the ceremony he and Gloria signed a document. He claimed that he did not know that the ceremony was a
marriage until Gloria told him later. He further testified that he did not go to Carmona, Cavite to apply for a marriage license, and that he had never resided in that area. In July of 2003,
he went to the Office of the Civil Registrar of Carmona, Cavite, to check on their marriage license, and was asked to show a copy of their marriage contract wherein the marriage license
number could be found.5 The Municipal Civil Registrar, Leodivinia C. Encarnacion, issued a certification on July 11, 2003 to the effect that the marriage license number appearing in the
marriage contract he submitted, Marriage License No. 9969967, was the number of another marriage license issued to a certain Arlindo Getalado and Myra Mabilangan.6 Said
certification reads as follows:
11 July 2003
TO WHOM IT MAY CONCERN:
This is to certify as per Registry Records of Marriage License filed in this office, Marriage License No. 9969967 was issued in favor of MR. ARLINDO GETALADO and MISS MYRA
MABILANGAN on January 19, 1993.
No Marriage License appear [sic] to have been issued to MR. SYED AZHAR ABBAS and MISS GLORIA F. GOO on January 8, 1993.
This certification is being issued to Mr. Syed Azhar Abbas for whatever legal purpose or intents it may serve.7
On cross-examination, Syed testified that Gloria had filed bigamy cases against him in 2001 and 2002, and that he had gone to the Municipal Civil Registrar of Carmona, Cavite to get
certification on whether or not there was a marriage license on advice of his counsel.8
Petitioner also presented Norberto Bagsic (Bagsic), an employee of the Municipal Civil Registrar of Carmona, Cavite. Bagsic appeared under a letter of authority from the Municipal Civil
Registrar of Carmona, Cavite, and brought documents pertaining to Marriage License No. 9969967, which was issued to Arlindo Getalado and Myra Mabilangan on January 20, 1993.9
Bagsic testified that their office issues serial numbers for marriage licenses and that the numbers are issued chronologically.10 He testified that the certification dated July 11, 2003,
was issued and signed by Leodivina Encarnacion, Registrar of the Municipality of Carmona, Cavite, certifying that Marriage License No. 9969967 was issued for Arlindo Getalado and
Myra Mabilangan on January 19, 1993, and that their office had not issued any other license of the same serial number, namely 9969967, to any other person.11
For her part, Gloria testified on her own behalf, and presented Reverend Mario Dauz, Atty. Lorenzo Sanchez, Felicitas Goo and May Ann Ceriola.
Reverend Mario Dauz (Rev. Dauz) testified that he was a minister of the Gospel and a barangay captain, and that he is authorized to solemnize marriages within the Philippines.12 He
testified that he solemnized the marriage of Syed Azhar Abbas and Gloria Goo at the residence of the bride on January 9, 1993.13 He stated that the witnesses were Atty. Lorenzo
Sanchez (Atty. Sanchez) and Mary Ann Ceriola.14 He testified that he had been solemnizing marriages since 1982, and that he is familiar with the requirements.15 Rev. Dauz further
testified that Atty. Sanchez gave him the marriage license the day before the actual wedding, and that the marriage contract was prepared by his secretary.16 After the solemnization of
the marriage, it was registered with the Local Civil Registrar of Manila, and Rev. Dauz submitted the marriage contract and copy of the marriage license with that office.17
Atty. Sanchez testified that he was asked to be the sponsor of the wedding of Syed Abbas and Gloria Goo by the mother of the bride, Felicitas Goo.18 He testified that he requested a
certain Qualin to secure the marriage license for the couple, and that this Qualin secured the license and gave the same to him on January 8, 1993.19 He further testified that he did not
know where the marriage license was obtained.20 He attended the wedding ceremony on January 9, 1993, signed the marriage contract as sponsor, and witnessed the signing of the
marriage contract by the couple, the solemnizing officer and the other witness, Mary Ann Ceriola.21
Felicitas Goo testified that Gloria Goo is her daughter and Syed Azhar Abbas is her son-in-law, and that she was present at the wedding ceremony held on January 9, 1993 at her
house.22 She testified that she sought the help of Atty. Sanchez at the Manila City Hall in securing the marriage license, and that a week before the marriage was to take place, a male
person went to their house with the application for marriage license.23 Three days later, the same person went back to their house, showed her the marriage license before returning it
to Atty. Sanchez who then gave it to Rev. Dauz, the solemnizing officer.24 She further testified that she did not read all of the contents of the marriage license, and that she was told

that the marriage license was obtained from Carmona.25 She also testified that a bigamy case had been filed by Gloria against Syed at the Regional Trial Court of Manila, evidenced by
an information for Bigamy dated January 10, 2003, pending before Branch 47 of the Regional Trial Court of Manila.26
As to Mary Ann Ceriolas testimony, the counsels for both parties stipulated that: (a) she is one of the sponsors at the wedding of Gloria Goo and Syed Abbas on January 9, 1993; (b)
she was seen in the wedding photos and she could identify all the persons depicted in said photos; and (c) her testimony corroborates that of Felicitas Goo and Atty. Sanchez.
The respondent, Gloria, testified that Syed is her husband, and presented the marriage contract bearing their signatures as proof.27 She and her mother sought the help of Atty.
Sanchez in securing a marriage license, and asked him to be one of the sponsors. A certain Qualin went to their house and said that he will get the marriage license for them, and after
several days returned with an application for marriage license for them to sign, which she and Syed did. After Qualin returned with the marriage license, they gave the license to Atty.
Sanchez who gave it to Rev. Dauz, the solemnizing officer. Gloria testified that she and Syed were married on January 9, 1993 at their residence.28
Gloria further testified that she has a daughter with Syed, born on June 15, 1993.29
Gloria also testified that she filed a bigamy case against Syed, who had married a certain Maria Corazon Buenaventura during the existence of the previous marriage, and that the case
was docketed as Criminal Case No. 02A-03408, with the RTC of Manila.30
Gloria stated that she and Syed had already been married on August 9, 1992 in Taiwan, but that she did not know if said marriage had been celebrated under Muslim rites, because the
one who celebrated their marriage was Chinese, and those around them at the time were Chinese.31
The Ruling of the RTC
In its October 5, 2005 Decision, the Pasay City RTC held that no valid marriage license was issued by the Municipal Civil Registrar of Carmona, Cavite in favor of Gloria and Syed, as
Marriage License No. 9969967 had been issued to Arlindo Getalado and Myra Mabilangan, and the Municipal Civil Registrar of Carmona, Cavite had certified that no marriage license
had been issued for Gloria and Syed.32 It also took into account the fact that neither party was a resident of Carmona, Cavite, the place where Marriage License No. 9969967 was
issued, in violation of Article 9 of the Family Code.33 As the marriage was not one of those exempt from the license requirement, and that the lack of a valid marriage license is an
absence of a formal requisite, the marriage of Gloria and Syed on January 9, 1993 was void ab initio.
The dispositive portion of the Decision reads as follows:
WHEREFORE, judgment is hereby rendered in favor of the petitioner, and against the respondent declaring as follows:
1. The marriage on January 9, 1993 between petitioner Syed Azhar Abbas and respondent Gloria Goo-Abbas is hereby annulled;
2. Terminating the community of property relations between the petitioner and the respondent even if no property was acquired during their cohabitation by reason of the nullity of the
marriage of the parties.
3. The Local Civil Registrar of Manila and the Civil Registrar General, National Statistics Office, are hereby ordered to cancel from their respective civil registries the marriage contracted
by petitioner Syed Azhar Abbas and respondent Gloria Goo-Abbas on January 9, 1993 in Manila.
SO ORDERED.34
Gloria filed a Motion for Reconsideration dated November 7, 2005, but the RTC denied the same, prompting her to appeal the questioned decision to the Court of Appeals.
The Ruling of the CA
In her appeal to the CA, Gloria submitted the following assignment of errors:
I
THE LOWER COURT ERRED IN DECLARING THE MARRIAGE BETWEEN THE PETITIONER AND RESPONDENT AS NULL AND VOID DUE TO THE ABSENCE OF A MARRIAGE
LICENSE DESPITE EVIDENCE CLEARLY SHOWING THAT THERE WAS ONE.
II
THE LOWER COURT ERRED IN NOT CONSIDERING, AS A REQUISITE OF A VALID MARRIAGE, THE OVERWHELMING EVIDENCE SHOWING THAT A MARRIAGE
CEREMONY TOOK PLACE WITH THE APPEARANCE OF THE CONTRACTING PARTIES BEFORE THE SOLEMNIZING OFFICER AND THEIR PERSONAL DECLARATION THAT
THEY TOOK EACH OTHER AS HUSBAND AND WIFE IN THE PRESENCE OF NOT LESS THAN TWO WITNESSES OF LEGAL AGE.
III
THE LOWER COURT ERRED IN NOT RULING ON THE ISSUE OF ESTOPPEL BY LACHES ON THE PART OF THE PETITIONER, AN ISSUE TIMELY RAISED IN THE COURT
BELOW.35
The CA gave credence to Glorias arguments, and granted her appeal. It held that the certification of the Municipal Civil Registrar failed to categorically state that a diligent search for
the marriage license of Gloria and Syed was conducted, and thus held that said certification could not be accorded probative value.36 The CA ruled that there was sufficient testimonial
and documentary evidence that Gloria and Syed had been validly married and that there was compliance with all the requisites laid down by law.37
It gave weight to the fact that Syed had admitted to having signed the marriage contract. The CA also considered that the parties had comported themselves as husband and wife, and
that Syed only instituted his petition after Gloria had filed a case against him for bigamy.38
The dispositive portion of the CA Decision reads as follows:
WHEREFORE, premises considered, the appeal is GRANTED. The Decision dated 05 October 2005 and Order dated 27 January 2006 of the Regional Trial Court of Pasay City,
Branch 109, in Civil Case No. 03-0382-CFM are REVERSED and SET ASIDE and the Petition for Declaration of Nullity of Marriage is DISMISSED. The marriage between Shed [sic]
Azhar Abbas and Gloria Goo Abbas contracted on 09 January 1993 remains valid and subsisting. No costs.
SO ORDERED.39
Syed then filed a Motion for Reconsideration dated April 1, 200840 but the same was denied by the CA in a Resolution dated July 24, 2008.41

Hence, this petition.

Grounds in Support of Petition
I
THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN CITING REPUBLIC VS. COURT OF APPEALS AS THE SAME IS DIAMETRICALLY
INCONSISTENT AND CONTRARY TO THE COURTS OWN FINDINGS AND CONCLUSIONS IN THIS CASE.
II
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN REVERSING AND SETTING ASIDE, WITHOUT ANY FACTUAL AND LEGAL BASIS, THE DECISION OF THE
REGIONAL TRIAL COURT GRANTING THE PETITION FOR DECLARATION OF NULLITY OF MARRIAGE.42
The Ruling of this Court
The petition is meritorious.
As the marriage of Gloria and Syed was solemnized on January 9, 1993, Executive Order No. 209, or the Family Code of the Philippines, is the applicable law. The pertinent provisions
that would apply to this particular case are Articles 3, 4 and 35(3), which read as follows:
Art. 3. The formal requisites of marriage are:
(1) Authority of the solemnizing officer;
(2) A valid marriage license except in the cases provided for in Chapter 2 of this Title; and
(3) A marriage ceremony which takes place with the appearance of the contracting parties before the solemnizing officer and their personal declaration that they take each other as
husband and wife in the presence of not less than two witnesses of legal age.
Art. 4. The absence of any of the essential or formal requisites shall render the marriage void ab initio, except as stated in Article 35(2).
A defect in any of the essential requisites shall render the marriage voidable as provided in Article 45.
An irregularity in the formal requisites shall not affect the validity of the marriage but the party or parties responsible for the irregularity shall be civilly, criminally and administratively
liable.
Art. 35. The following marriages shall be void from the beginning:
xxxx
(3) Those solemnized without a license, except those covered by the preceding Chapter.
There is no issue with the essential requisites under Art. 2 of the Family Code, nor with the formal requisites of the authority of the solemnizing officer and the conduct of the marriage
ceremony. Nor is the marriage one that is exempt from the requirement of a valid marriage license under Chapter 2, Title I of the Family Code. The resolution of this case, thus, hinges
on whether or not a valid marriage license had been issued for the couple. The RTC held that no valid marriage license had been issued. The CA held that there was a valid marriage
license.
We find the RTC to be correct in this instance.
Respondent Gloria failed to present the actual marriage license, or a copy thereof, and relied on the marriage contract as well as the testimonies of her witnesses to prove the existence
of said license. To prove that no such license was issued, Syed turned to the office of the Municipal Civil Registrar of Carmona, Cavite which had allegedly issued said license. It was
there that he requested certification that no such license was issued. In the case of Republic v. Court of Appeals43 such certification was allowed, as permitted by Sec. 29, Rule 132 of
the Rules of Court, which reads:
SEC. 28. Proof of lack of record. A written statement signed by an officer having the custody of an official record or by his deputy that after diligent search, no record or entry of a
specified tenor is found to exist in the records of his office, accompanied by a certificate as above provided, is admissible as evidence that the records of his office contain no such
record or entry.
In the case of Republic, in allowing the certification of the Civil Registrar of Pasig to prove the non-issuance of a marriage license, the Court held:
The above Rule authorized the custodian of the documents to certify that despite diligent search, a particular document does not exist in his office or that a particular entry of a specified
tenor was not to be found in a register. As custodians of public documents, civil registrars are public officers charged with the duty, inter alia, of maintaining a register book where they
are required to enter all applications for marriage licenses, including the names of the applicants, the date the marriage license was issued and such other relevant data.44
The Court held in that case that the certification issued by the civil registrar enjoyed probative value, as his duty was to maintain records of data relative to the issuance of a marriage
license.
The Municipal Civil Registrar of Carmona, Cavite, where the marriage license of Gloria and Syed was allegedly issued, issued a certification to the effect that no such marriage license
for Gloria and Syed was issued, and that the serial number of the marriage license pertained to another couple, Arlindo Getal ado and Myra Mabilangan. A certified machine copy of
Marriage License No. 9969967 was presented, which was issued in Carmona, Cavite, and indeed, the names of Gloria and Syed do not appear in the document.
In reversing the RTC, the CA focused on the wording of the certification, stating that it did not comply with Section 28, Rule 132 of the Rules of Court.
The CA deduced that from the absence of the words despite diligent search in the certification, and since the certification used stated that no marriage license appears to have been
issued, no diligent search had been conducted and thus the certification could not be given probative value.
To justify that deduction, the CA cited the case of Republic v. Court of Appeals.45 It is worth noting that in that particular case, the Court, in sustaining the finding of the lower court that
a marriage license was lacking, relied on the Certification issued by the Civil Registrar of Pasig, which merely stated that the alleged marriage license could not be located as the same

did not appear in their records. Nowhere in the Certification was it categorically stated that the officer involved conducted a diligent search, nor is a categorical declaration absolutely
necessary for Sec. 28, Rule 132 of the Rules of Court to apply.
Under Sec. 3(m), Rule 131 of the Rules of Court, it is a disputable presumption that an official duty has been regularly performed, absent contradiction or other evidence to the contrary.
We held, The presumption of regularity of official acts may be rebutted by affirmative evidence of irregularity or failure to perform a duty.46 No such affirmative evidence was shown
that the Municipal Civil Registrar was lax in performing her duty of checking the records of their office, thus the presumption must stand. In fact, proof does exist of a diligent search
having been conducted, as Marriage License No. 996967 was indeed located and submitted to the court. The fact that the names in said license do not correspond to those of Gloria
and Syed does not overturn the presumption that the registrar conducted a diligent search of the records of her office.
It is telling that Gloria failed to present their marriage license or a copy thereof to the court. She failed to explain why the marriage license was secured in Carmona, Cavite, a location
where, admittedly, neither party resided. She took no pains to apply for the license, so she is not the best witness to testify to the validity and existence of said license. Neither could the
other witnesses she presented prove the existence of the marriage license, as none of them applied for the license in Carmona, Cavite. Her mother, Felicitas Goo, could not even testify
as to the contents of the license, having admitted to not reading all of its contents. Atty. Sanchez, one of the sponsors, whom Gloria and Felicitas Goo approached for assistance in
securing the license, admitted not knowing where the license came from. The task of applying for the license was delegated to a certain Qualin, who could have testified as to how the
license was secured and thus impeached the certification of the Municipal Civil Registrar as well as the testimony of her representative. As Gloria failed to present this Qualin, the
certification of the Municipal Civil Registrar still enjoys probative value.
It is also noted that the solemnizing officer testified that the marriage contract and a copy of the marriage license were submitted to the Local Civil Registrar of Manila. Thus, a copy of
the marriage license could have simply been secured from that office and submitted to the court. However, Gloria inexplicably failed to do so, further weakening her claim that there was
a valid marriage license issued for her and Syed.
In the case of Cario v. Cario,47 following the case of Republic,48 it was held that the certification of the Local Civil Registrar that their office had no record of a marriage license was
adequate to prove the non-issuance of said license. The case of Cario further held that the presumed validity of the marriage of the parties had been overcome, and that it became the
burden of the party alleging a valid marriage to prove that the marriage was valid, and that the required marriage license had been secured.49 Gloria has failed to discharge that
burden, and the only conclusion that can be reached is that no valid marriage license was issued. It cannot be said that there was a simple irregularity in the marriage license that would
not affect the validity of the marriage, as no license was presented by the respondent. No marriage license was proven to hav e been issued to Gloria and Syed, based on the
certification of the Municipal Civil Registrar of Carmona, Cavite and Glorias failure to produce a copy of the alleged marriage license.
To bolster its ruling, the CA cited other evidence to support its conclusion that Gloria and Syed were validly married. To quote the CA:
Moreover, the record is replete with evidence, testimonial and documentary, that appellant and appellee have been validly married and there was compliance with all the requisites laid
down by law. Both parties are legally capacitated to marry. A certificate of legal capacity was even issued by the Embassy of Pakistan in favor of appellee. The parties herein gave their
consent freely. Appellee admitted that the signature above his name in the marriage contract was his. Several pictures were presented showing appellant and appellee, before the
solemnizing officer, the witnesses and other members of appellants family, taken during the marriage ceremony, as well as in the restaurant where the lunch was held after the
marriage ceremony. Most telling of all is Exhibit 5-C which shows appellee signing the Marriage Contract.
xxxx
The parties have comported themselves as husband and wife and has [sic] one offspring, Aliea Fatima Goo Abbas, who was born on 15 June 1993. It took appellee more than ten (10)
years before he filed on 01 August 2003 his Petition for Declaration of Nullity of Marriage under Article 4 of the Family Code. We take serious note that said Petition appears to have
been instituted by him only after an Information for Bigamy (Exhibit 1) dated 10 January 2003 was filed against him for contracting a second or subsequent marriage with one Ma.
Corazon (Maryam) T. Buenaventura. We are not ready to reward (appellee) by declaring the nullity of his marriage and give him his freedom and in the process allow him to profit from
his own deceit and perfidy.50
All the evidence cited by the CA to show that a wedding ceremony was conducted and a marriage contract was signed does not operate to cure the absence of a valid marriage license.
Article 4 of the Family Code is clear when it says, The absence of any of the essential or formal requisites shall render the marriage void ab initio, except as stated in Article 35(2).
Article 35(3) of the Family Code also provides that a marriage solemnized without a license is void from the beginning, except those exempt from the license requirement under Articles
27 to 34, Chapter 2, Title I of the same Code.51 Again, this marriage cannot be characterized as among the exemptions, and thus, having been solemnized without a marriage license,
is void ab initio.
As to the motive of Syed in seeking to annul his marriage to Gloria, it may well be that his motives are less than pure, that he seeks to evade a bigamy suit. Be that as it may, the same
does not make up for the failure of the respondent to prove that they had a valid marriage license, given the weight of evidence presented by petitioner. The lack of a valid marriage
license cannot be attributed to him, as it was Gloria who took steps to procure the same. The law must be applied. As the marriage license, a formal requisite, is clearly absent, the
marriage of Gloria and Syed is void ab initio.
WHEREFORE, in light of the foregoing, the petition is hereby GRANTED. The assailed Decision dated March 11, 2008 and Resolution dated July 24, 2008 of the Court of Appeals in
CA-G.R. CV No. 86760 are hereby REVERSED and SET ASIDE. The Decision of the Regional Trial Court, Branch 109, Pasay City dated October 5, 2005 in Civil Case No. 03-0382CFM annulling the marriage of petitioner with respondent on January 9, 1993 is hereby REINSTATED.
No costs.
SO ORDERED.
Diosdado Peralta, Roberto Abad, Jose Catral Mendoza, Marvic Mario Victor Leonen, JJ., concur.

2. A.M. No. RTJ-12-2326

January 30, 2013

(Formerly A.M. OCA I.P.I. No. 11-3692-RTJ)

GEOFFREY BECKETT, Complainant,

vs.
JUDGE OLEGARIO R. SARMIENTO, JR., Regional Trial Court, Branch 24, Cebu City, Respondent.

DECISION

VELASCO, JR., J.:

In all questions relating to the care, custody, education and property of the children, the latter's welfare is paramount. This means that the best interest of the minor can override
procedural rules and even the rights of parents to the custody of their children. Since, in this case, the very life and existence of the minor is at stake and the child is in an age when she
can exercise an intelligent choice, the courts can do no less than respect, enforce and give meaning and substance to that choice and uphold her right to live in an atmosphere
conducive to her physical, moral and intellectual development.1 x x x

The Case

This case arose from a complaint filed by Geoffrey Beckett charging Judge Olegario R. Sarmiento, Jr. of the Regional Trial Court (RTC) of Cebu City, Branch 24, with gross ignorance
of the law, manifest partiality and dereliction and neglect of duty allegedly committed in relation to Sp. Proc. No. 18182-CEB, entitled Geoffrey Beckett v. Eltesa Densing Beckett, while
pending before that court.

The Antecedent Facts

Geoffrey Beckett (Beckett or Complainant), an Australian national, was previously married to Eltesa Densing Beckett (Eltesa), a Filipina. Out of the marriage was born on June 29,
2001, Geoffrey Beckett, Jr. (Geoffrey, Jr.).

In his Complaint-Affidavit,2 Beckett alleged that their union was, from the start, far from ideal. In fact, according to him, they eventually separated and, worse still, they sued each other.

In 2006, Eltesa filed a case against Beckett for violation of Republic Act No. (RA) 7610, otherwise known as the Violence against Women and Children Act, followed by a suit for the
declaration of nullity of their marriage, docketed as Civil Case No. CEB -32254. Both cases ended in the sala of Judge Olegario Sarmiento, Jr. (respondent or Judge Sarmiento). For his
part, Beckett commenced criminal charges against Eltesa, one of which was for adultery.

The couples initial legal battle ended when Judge Sarmiento, on September 25, 2006 in Civil Case No. CEB-32254, rendered judgment3 based on a compromise agreement in which
Eltesa and Beckett agreed and undertook, among others, to cause the dismissal of all pending civil and criminal cases each may have filed against the other. They categorically agreed
too that Beckett shall have full and permanent custody over Geoffrey, Jr., then five (5) years old, subject to the visitorial rights of Eltesa.

Thereafter, Beckett left for Australia, taking Geoffrey, Jr. with him. As with his three other children from previous relationships, so Beckett alleged, he cared and provided well for
Geoffrey, Jr. Moreover, as agreed upon, they would come and see Eltesa in Cebu every Christmas.

In 2007, Beckett obtained a divorce from Eltesa in Australia. This notwithstanding, the yearly Christmas visits continued. In the 2010 visit, Beckett consented to have Geoffrey, Jr. stay
with Eltesa even after the holidays, provided she return the child on January 9, 2011. January 9 came and went but Geoffrey, Jr. remained with Eltesa, prompting Beckett to file a
petition against Eltesa for violation of RA 7610. Docketed as Sp. Proc. No. 18182-CEB,4this petition was again raffled to the sala of Judge Sarmiento. And because Geoffrey remained
in the meantime in the custody of Eltesa, Beckett later applied in Sp. Proc. No. 18182-CEB for the issuance of a writ of habeas corpus.

Beckett further relates that, during the March 1, 2011 conference on the application for habeas corpus, Geoffrey, Jr., then nine (9) years old, displayed inside the courtroom hysterical
conduct, shouting and crying, not wanting to let go of Eltesa and acting as though, he, the father, was a total stranger. Despite Geoffrey Jr.s outburst, Judge Sarmiento issued an
Order5, dated March 1, 2011, directing inter alia the following: (1) Eltesa to return Geoffrey, Jr. to Beckett; and (2) Beckett to bring the child in the pre-trial conference set for March 15,
2001.

For some reason, the turnover of Geoffrey, Jr. to Beckett did not materialize.

Beckett also alleged that while waiting for the March 15, 2011 pre-trial conference to start, he saw one Helen Sy, purportedly a close friend of Eltesa, enter Judge Sarmientos
chambers. Then, during the conference itself, Eltesa moved for reconsideration of the courts March 1, 2011 Order, praying that it be set aside insofar as it directed her to return the
custody of Geoffrey, Jr. to Beckett. To this partial motion, Beckett requested, and was granted, a period of five (5) days to file his comment/opposition. Additionally, Beckett sought the
immediate implementation of the said March 1, 2011 Order. But instead of enforcing said order and/or waiting for Becketts comment, Judge Sarmiento, in open court, issued another
order giving Eltesa provisional custody over Geoffrey, Jr. and at the same time directing the Department of Social Welfare and Development (DSWD) to conduct a social case study on
the child.

Weeks later, or in the March 30, 2011 setting, Beckett moved for the reconsideration of the judges March 15, 2011 Order, on the main contention that Judge Sarmiento can no longer
grant provisional custody to Eltesa in light of the adverted judgment on compromise agreement. Also, according to him, during this March 30 proceeding, respondent judge conversed
with Eltesa in Cebuano, a dialect which neither the former nor his counsel understood, and which they (respondent and Eltesa) persisted on using despite requests that they
communicate in English or Filipino. Becketts lawyer then asked that he be allowed to confer in private with his client for a few minutes but when they returned to the courtroom, the
proceedings had already been adjourned.

As his motion for reconsideration had remained unresolved as of June 13, 2011, Beckett filed on that day an urgent motion to resolve. Several hearings on the case were postponed
because of the belated submission by the DSWD of the case study report requested by respondent judge.

It is upon the foregoing factual backdrop that Beckett has instituted the instant complaint, docketed as A.M. OCA IPI No. 11-3692- RTJ, later redocketed as A.M. No. RTJ-12-2326. As
argued, respondent is liable for (1) gross ignorance of the law for granting Eltesa provisional custody over Geoffrey Jr.; and (2) partiality by committing acts of serious misconduct and
irregularities in the performance of official duties, such as but not limited to allowing one Helen Sy to enter his chambers before the March 15, 2011 hearing, his habit of conversing with
Eltesa in the local dialect and for adjourning a hearing while he was conferring with his counsel in private. Beckett predicates his charge of dereliction and neglect of duty on
respondents alleged failure to resolve his motion for reconsideration of the March 15, 2011 order giving provisional custody of his child to his mother.

In his answer in response to the 1st Indorsement dated July 14, 2011 of the Office of the Court of Administrator (OCA), respondent judge denied complainants allegations of partiality
and of being biased against the latter, particularly describing his order granting Eltesa provisional custody as proper. In this regard, respondent judge averred that, per his Order of
March 30, 2011, he deferred action on Becketts motion for reconsideration of the courts March 15, 2011 Order pending submission of the Social Case Study Report, while the June 21,
2011 Order denying Becketts said motion for reconsideration was based on that Social Case Study Report6 of Social Welfare Officer Clavel Saycon, DWSD- Region VII, who
recommended that Geoffrey, Jr. be in the care and custody of the mother. As an added observation, respondent judge stated that Beckett did not cry "Bias" when he (respondent)
approved the compromise agreement in Civil Case CEB 32254 and when he later urged Beckett to commence habeas corpus proceedings. Attached to the letter-answer are the case
study reports submitted by the DSWD regional office, one of which was prepared by psychologist Christine V. Duhaylungsod,7 who elicited from Geoffrey, Jr. the following information:
that (1) complainant always leaves him to the care of his older half-brother or his fathers girlfriends; (2) he was at one time sent out of the house by one of complainants girlfriends and
he had to stay in the garage alone; and (3) he never wanted to stay with complainant whom he feared and who once locked him in his room without food. In their respective reports, Dr.
Obra and Dr. Saycon, a psychiatrist, both strongly recommended that custody over Geoffrey, Jr. be given to Eltesa.

Respondent judge also denied knowing one Helen Sy adverted to in the basic complaint and explained in some detail why he spoke at one instance to Eltesa in Cebuano. He closed
with a statement that he issued his assailed Orders in good faith and that he had, as sought by complainant, inhibited himself from further hearing SP Proc. No. 18182-CEB.

In the Agenda Report dated March 8, 2012, the OCA regards the complaint meritorious insofar as the charges for gross ignorance of the law is concerned given that respondent judge
issued his March 15, 2011 Order granting provisional custody in favor of Eltesa despite the existence of the judicial compromise. The OCA, thus, recommended that respondent judge
be adjudged liable for gross ignorance of the law and fined with stern warning. The inculpatory portions of the OCAs evaluation report pertinently read:

x x x A compromise agreement that is intended to resolve a matter already under litigation is normally called a judicial compromise. Once it is stamped with judicial imprimatur, it
becomes more than a mere contract binding upon the parties. x x x It has the force of and effect of any other judgment. x x x Thus, a compromise agreement that has been made and
duly approved by the court attains the effect and authority of res judicata x x x.

xxxx

The pertinent portion of the judgment on Compromise Agreement x x x, which granted and transferred permanent custody of Geoffrey, Jr. to the herein complainant is unequivocal.
Moreover, the same order even allowed complainant to bring with him Geoffrey, Jr. to Australia. Thus, in granting Geoffrey, Jr.s custody to his mother in an Order issued on 15 March

2011 on a mere Motion for Partial Reconsideration, respondent judge violated a basic and fundamental principle of res judicata. When the law is elementary, not to be aware of it
constitutes gross ignorance thereof. After all, judges are expected to have more than just a modicum of acquaintance with the statutes and procedural rules. Hence, the respondent
judge is guilty of gross ignorance of the law.8

The OCA, however, effectively recommends the dismissal of the charge of manifest partiality and other offenses for want of sufficient substantiation, noting that the complainant has
failed to adduce substantial evidence to overcome the presumption of regularity in the performance of judicial duties.

Anent the charge of Manifest Partiality, this Office finds the same not supported by substantial evidence. In administrative proceedings, the complainant bears the onus of establishing,
by substantial evidence, the averments in his complaint. Complainant failed to present substantial evidence to show the alleged partiality and ignorance of respondent judge, Mere
suspicion that a judge is biased is not enough. Bare allegations of partiality will not suffice in the absence of clear showing that will overcome the presumption that the judge dispensed
justice without fear or favor.9

The Court also notes that, contrary to complainants pretense, respondent judge had acted on his motion for reconsideration of the contentious March 15, 2011 Order.

The OCAs recommendation for the dismissal of the complaint insofar as it charges respondent judge with manifest partiality and dereliction and neglect of duties is well-taken. The
Court cannot presume partiality and serious misconduct and irregularities based on circumstances alleged in the complaint. Moreover, for serious misconduct to obtain, the judicial act/s
complained of should be corrupt or inspired by an intention to violate the law or persistent disregard of well-known legal precepts.10 Nothing in the records tends to suggest that
respondent judge was actuated by malice or corrupt motives in issuing his disputed March 15, 2011 order granting Eltesa custody of Geoffrey, Jr. despite the adverted compromise
agreement.

The Issue

The remaining issue then boils down to whether or not respondent Judge Sarmiento is guilty of gross ignorance of the law.

The Courts Ruling

Gross ignorance of the law on the part of a judge presupposes an appalling lack of familiarity with simple rules of law or procedures and well-established jurisprudence which tends to
erode the public trust in the competence and fairness of the court which he personifies. Not to know the law as basic, almost elementary, as the Rules of Court, or acting in disregard of
established rule of law as if he were not aware of the same constitutes gross ignorance whence no one is excused, especially an RTC judge.11

Complainant has charged respondent judge with gross ignorance of the law. He states in this regard that respondent judge, in arbitrary defiance of his own Decision of September 25,
2006 which constitutes res judicata or a bar to him to pass upon the issue of Geoffrey, Jrs. custody, granted, via his March 15, 2011 Order, provisional custody over Geoffrey, Jr. to
Eltesa. The Decision adverted to refers to the judgment on compromise agreement.

The Court cannot go along with complainants above posture.

Respondent judge, in granting provisional custody over Geoffrey, Jr. in favor of his mother, Eltesa, did not disregard the res judicata rule. The more appropriate description of the legal
situation engendered by the March 15, 2011 Order issued amidst the persistent plea of the child not to be returned to his father, is that respondent judge exhibited fidelity to
jurisprudential command to accord primacy to the welfare and interest of a minor child. As it were, the matter of custody, to borrow from Espiritu v. Court of Appeals,12 "is not
permanent and unalterable and can always be re-examined and adjusted." And as aptly observed in a separate opinion in Dacasin v. Dacasin,13 a custody agreement can never be
regarded as "permanent and unbending," the simple reason being that the situation of the parents and even of the child can change, such that sticking to the agreed arrangement would
no longer be to the latters best interest. In a very real sense, then, a judgment involving the custody of a minor child cannot be accorded the force and effect of res judicata.

Now to another point. In disputes concerning post-separation custody over a minor, the well-settled rule is that no child under seven (7) years of age shall be separated from the mother,
unless the court finds compelling reasons to order otherwise.14 And if already over 7 years of age, the childs choice as to which of his parents he prefers to be under custody shall be
respected, unless the parent chosen proves to be unfit.15 Finally, in Perez v. Court of Appeals,16 We held that in custody cases, the foremost consideration is always the welfare and
best interest of the child, as reflected in no less than the U.N. Convention on the Rights of the Child which provides that "in all actions concerning children, whether undertaken by public
or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration."17

In the light of the foregoing, respondent judge cannot be held guilty of the charges hurled by the complainant against him for the reason that absent a finding of strong reasons to rule
otherwise, the preference of a child over 7 years of age as to whom he desired to live with shall be respected. Moreover, custody, even if previously granted by a competent court in
favor of a parent, is not, to reiterate, permanent. In Espiritu,18 We ruled that:

x x x The matter of custody is not permanent and unalterable.1wphi1 If the parent who was given custody suffers a future character change and becomes unfit, the matter of custody
can always be re-examined and adjusted x x x. To be sure, the welfare, the best interests, the benefit, and the good of the child must be determined as of the time that either parent is
chosen to be the custodian. x x x

As Rosalind and Reginald Espiritu in Espiritu,19 Geoffrey, Jr., at the time when he persistently refused to be turned over to his father, was already over 7 years of age. As such, he was
very much capable of deciding, based on his past experiences, with whom he wanted to stay. Noteworthy too are the results of the interviews which were reflected in the three reports
previously mentioned, excerpts from which are hereunder quoted, to wit:

x x x In so far as Geoffrey, Jr.s account of experience, being with his fathers custody is something that he is afraid of and something he does not want to happen again. However,
being with his mother is the one (sic) he is looking to (sic) and aspires.20

xxxx

x x x Being in the custody of his mother is something (sic) he feel (sic) secure and protected and this is manifested in the childs craving for his mothers presence all the time and the
desire to be always with her that even (sic) he sleeps he wants his mother to embrace and hug him and cries when he wakes up and he cannot see his mother.21

xxxx

x x x He locked me in the room. He always leave (sic) me. x x x they keep fighting, Daddy and his girlfriend ... they'll get angry with (sic) me ... I'm scared with (sic) Daddy.22

xxxx

Meanwhile, Ms. Barbo (the caregiver or yaya of Geoffrey, Jr.), expressed peculiarities, "Sa Daddy niya, he dd (sic) not fear his mom. Sa mommy niya, he fear (sic) his dad."23

With these, We see no reason to sustain the charge against respondent judge for gross ignorance of the law. For clearly, absent any evidence to the contrary, Geoffrey, Jr. chose to live
with his mother for a reason, which respondent judge, consistent with the promotion of the best interest of the child, provisionally granted through the issuance of the disputed March 15,
2011 Order. In fact, in issuing the disputed Order, respondent judge rectified an error previously made when he handed out the Judgment on Compromise Agreement in 2006.

WHEREFORE, premises considered, the complaint is hereby DISMISSED.

SO ORDERED.

3. G.R. No. 183918

January 15, 2014

FRANCISCO LIM, Petitioner,

vs.
EQUITABLE PCI BANK, now known as the BANCO DE ORO UNIBANK, INC.,* Respondent.

DECISION

DEL CASTILLO, J.:

The basic rule is that he who alleges must prove his case.

This Petition for Review on Certiorari1 under Rule 45 of the Rules of Court assails the July 30, 2008 Decision2 of the Court of Appeals CA) in CA-G.R. CV No. 85139.

Factual Antecedents

On November 17, 1988, petitioner Francisco Lim (petitioner) executed an Irrevocable Special Power of Attorney3 in favor of his brother, Franco Lim (Franco), authorizing the latter to
mortgage his share in the property covered by by Transfer Certificate of Title (TCT) No. 57176,4 which they co-owned.5

On February 9, 1989, Banco De Oro Savings and Mortgage Bank released a loan in the amount of P8.5 million by virtue of the said Irrevocable Special Power of Attorney, which was
entered in the Register of Deeds of San Juan, Metro Manila.6

On December 28, 1992, the loan was fully paid by Franco.7

On June 14, 1996, petitioner, Franco, and their mother Victoria Yao Lim (Victoria) obtained from respondent Equitable PCI Bank (respondent; formerly Equitable Banking Corporation) a
loan in the amount of P30 million in favor of Sun Paper Products, Inc. To secure the loan, petitioner and Franco executed in favor of respondent a Real Estate Mortgage8 over the same
property.9

However, when the loan was not paid, respondent foreclosed the mortgaged property.10

On September 29, 1999, TCT No. 947011 and Tax Declaration No. 96-3180712 were issued in the name of respondent.13

Thereafter, a Writ of Possession14 in favor of respondent was issued by the Regional Trial Court (RTC) of Pasig City, Branch 158, in LRC Case No. R-5818.

On January 11, 2001, petitioner filed before the RTC of Pasig a Motion for the Issuance of Temporary Restraining Order (TRO)15 and a Complaint16 for Cancellation of Special Power
of Attorney, Mortgage Contract, Certificate of Sale, TCT No. 9470, and Tax Declaration No. 96-31807, with Damages and Issuance of Preliminary Mandatory Injunction, docketed as
Civil Case No. 68214 and raffled to Branch 267, against respondent, Franco, and Victoria. Petitioner alleged that he did not authorize Franco to mortgage the subject property to
respondent and that his signatures in the Real Estate Mortgage and the Surety Agreement17 were forged.

On January 19, 2001, the RTC issued an Order18 granting petitioners Motion for the issuance of a TRO to prevent respondent from enforcing the Writ of Possession. Thus:

WHEREFORE, considering that grave and irreparable injury will result on [petitioner] before the application of injunctive relief can be heard on notice and pursuant to Section 4, Rule 58
of the 1997 Rules of Civil Procedure, as amended, let a Temporary Restraining Order (TRO) be issued upon posting by [petitioner] of a bond executed to the party enjoined
([respondent] Equitable PCI Bank) in the amount of ONE HUNDRED THOUSAND PESOS (P100,000.00) bond to be approved by the Court, to the effect that [petitioner] will pay to such
party all damages which [respondent and] defendants may sustain by reason of the TRO if the Court should finally decide that the [petitioner] is not really entitled thereto. Consequently,
[respondent and] defendants, their agents, officers, representatives and all persons acting on their behalf, are restrained from further executing the Notice of Compliance and/or Writ of
Possession.

SO ORDERED.19

Respondent, for its part, filed an Answer Cum Motion to Dismiss20 contending that the trial court has no jurisdiction to issue a TRO or a preliminary injunction enjoining the
implementation of the Writ of Possession issued by a co-equal court.21 Respondent also argued that it is not privy to the execution of the Irrevocable Special Power of Attorney22 and
that since there is no allegation that the foreclosure was defective or void, there is no reason to cancel TCT No. 9470 and Tax Declaration No. 96-31807.23

On April 19, 2001, the RTC issued an Order24 granting petitioners application for injunctive relief, to wit:

WHEREFORE, considering that based from testimonial and documentary evidence, there is sufficient reason to believe that grave and irreparable injury will result on [petitioner] before
the main case can be heard on notice and pursuant to Section 4, Rule 58 of the 1997 Rules of Civil Procedure, as amended, let a writ of preliminary injunction be issued upon posting
by [petitioner] of a bond executed to the party enjoined ([respondent] Equitable PCI Bank) in the amount of THREE MILLION PESOS (Php3,000,000.00) bond to be approved by the
Court, to the effect that [petitioner] will pay to such party all damages which [respondent and] defendants may sustain by reason of the said writ if the Court should finally decide that the
[petitioner] is not really entitled thereto. Consequently, [respondent and] defendants, their agents, officers, representatives and all persons acting on their behalf, are restrained from
further executing the Notice of Compliance and/or Writ of Possession.

SO ORDERED.25

Franco and Victoria, however, did not participate in the proceedings.26

Ruling of the Regional Trial Court

On April 4, 2005, the RTC rendered a Decision27 in favor of petitioner. It ruled that petitioner was able to prove by preponderance of evidence that he did not participate in the execution
of the mortgage contract giving rise to the presumption that his signature was forged.28 The dispositive portion of the Decision reads:

WHEREFORE, IN VIEW OF THE FOREGOING CONSIDERATIONS, judgment is hereby rendered in favor of [petitioner] Francisco Lim and against the [respondent] Equitable PCI
Bank, Franco Lim and Victoria Yao Lim.

Accordingly, the Real Estate Mortgage Contract dated 14 June 1996 covered by Transfer Certificate of Title No. 57176; the Certificate of Sale dated 23 December 1997 covering the
same title; TCT No. 9470 in the name of [respondent] Bank; and Tax Declaration No. 96-31807 issued in the name of the [respondent] Bank are hereby declared null and void and of no
force and effect.

The writ of preliminary injunction which was issued by the Court as per Order dated 19 April 2001 is hereby made permanent.

SO ORDERED.29

Ruling of the Court of Appeals

On appeal, the CA reversed the RTC Decision. It ruled that petitioners mere allegation that his signature in the mortgage contract was forged is not sufficient to overcome the
presumption of regularity of the notarized document.30 Thus, the CA disposed of the case in this wise:

WHEREFORE, premises considered, the instant appeal is hereby GRANTED. The assailed Decision of the Regional Trial Court is SET ASIDE. The complaint filed by [petitioner]
Francisco Lim against [respondent] Equitable PCI Banking Corporation is DISMISSED for lack of merit.

SO ORDERED.31

Issues

Hence, this recourse by petitioner raising the following questions:

Did the [CA] err when it held that no evidence was presented to support Petitioners claim that his signature was forged?

Corollary to the issue above, is the presentation of expert evidence indispensable in order that forgery may be sufficiently proven in this case?

Did the [CA] err when it set aside the Decision rendered by the Trial Court on 04 April 2005 and forthwith dismissed the complaint filed by Francisco Lim against Equitable PCI Banking
Corporation for lack of merit?

Did Respondent Bank exercise the diligence required of it in the subject mortgage transaction; if it did not, did Respondent Banks failure violate the rights of Petitioner?32

In a nutshell, the issues boil down to whether petitioner was able to prove that his signature was forged.

Petitioners Arguments

Petitioner contends that his signature in the mortgage contract was forged as he was not in the Philippines at the time of its execution.33 He posits that the presentation of expert
witnesses is not required to prove forgery as the court may make its own determination based on the evidence presented.34 He claims that respondent was negligent in approving the
loan and in accepting the subject property as security for the loan.35 He also blames respondent for not conducting a more in-depth inquiry before approving the loan since it was a
"take-out" from a mortgage36constituted in favor of Planters Development Bank.37 Lastly, he insists that respondent should have been alerted by the fact that the mortgage contract
was executed without the consent of his wife.38

Respondents Arguments

Respondent, on the other hand, echoes the ruling of the CA that petitioners mere denial is not enough to prove that his signature was forged.39 Respondent points out that there was,
in fact, no attempt on petitioners part to compare the alleged forged signature with any of his genuine signatures.40 Also, no evidence was presented to show that respondent did not
exercise due diligence when it approved the loan and accepted the mortgage.41 More important, petitioner cannot feign ignorance of the execution and existence of the mortgage
because he even communicated with respondent to settle the loan and, when the property was foreclosed, to repurchase the same.42 Hence, petitioner is estopped from assailing the
validity of the mortgage contract.43

Our Ruling

The Petition is bereft of merit.

Petitioner failed to prove that his signature was forged.

Allegations of forgery, like all other allegations, must be proved by clear, positive, and convincing evidence by the party alleging it.44 It should not be presumed45 but must be
established by comparing the alleged forged signature with the genuine signatures.46 Although handwriting experts are often offered as witnesses, they are not indispensable because
judges must exercise independent judgment in determining the authenticity or genuineness of the signatures in question.47

In this case, the alleged forged signature was not compared with the genuine signatures of petitioner as no sample signatures were submitted. What petitioner submitted was another
mortgage contract48 executed in favor of Planters Development Bank, which he claims was also forged by his brother. But except for this, no other evidence was submitted by
petitioner to prove his allegation of forgery. His allegation that he was in the US at the time of the execution of the mortgage contract is also not sufficient proof that his signature was
forged.

Petitioner failed to prove negligence on the part of respondent.

Likewise without merit is petitioners allegation of negligence on the part of respondent.

Before entering into a mortgage contract, banks are expected to exercise due diligence.49 However, in this case, no evidence was presented to show that respondent did not exercise
due diligence or that it was negligent in accepting the mortgage.50 That petitioner was erroneously described as single and a Filipino citizen in the mortgage contract, when in fact he is
married and an American citizen, cannot be attributed to respondent considering that the title of the mortgaged property was registered under "FRANCISCO LIM and FRANCO LIM,
both Filipino citizens, of legal age, single."

The nature of the property was never raised as an issue.

The absence of his wifes signature on the mortgage contract also has no bearing in this case.

We are not unaware that all property of the marriage is presumed to be conjugal, unless it is shown that it is owned exclusively by the husband or the wife;51 that this presumption is not
overcome by the fact that the property is registered in the name of the husband or the wife alone;52 and that the consent of both spouses is required before a conjugal property may be
mortgaged.53 However, we find it iniquitous to apply the foregoing presumption especially since the nature of the mortgaged property was never raised as an issue before the RTC, the
CA, and even before this Court. In fact, petitioner never alleged in his Complaint that the said property was conjugal in nature. Hence, respondent had no opportunity to rebut the said
presumption.

Worth mentioning, in passing, is the ruling in Philippine National Bank v. Court of Appeals54 to wit:

The well-known rule in this jurisdiction is that a person dealing with a registered land has a right to rely upon the face 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 such inquiry.

A torrens title concludes all controversy over ownership of the land covered by a final [decree] of registration. Once the title is registered the owner may rest assured without the
necessity of stepping into the portals of the court or sitting in the mirador de su casa to avoid the possibility of losing his land.

Article 160 of the Civil Code provides as follows:

"Art. 160. All property of the marriage is presumed to belong to the conjugal partnership, unless it be proved that it pertains exclusively to the husband or to the wife."

The presumption applies to property acquired during the lifetime of the husband and wife. In this case, it appears on the face of the title that the properties were acquired by Donata
Montemayor when she was already a widow. When the property is registered in the name of a spouse only and there is no showing as to when the property was acquired by said
spouse, this is an indication that the property belongs exclusively to said spouse. And this presumption under Article 160 of the Civil Code cannot prevail when the title is in the name of
only one spouse and the rights of innocent third parties are involved.

The PNB had a reason to rely on what appears on the certificates of title of the properties mortgaged. For all legal purposes, the PNB is a mortgagee in good faith for at the time the
mortgages covering said properties were constituted the PNB was not aware to any flaw of the title of the mortgagor. (Emphasis supplied)

Petitioners allegation of forgery is belied by the evidence.

Moreover, petitioners subsequent actions belie his allegation of forgery.1wphi1 Before the expiration of the redemption period, petitioner sent respondent a letter55 signifying his
intention to reacquire the said property. He even visited the bank to discuss the matter.56 Clearly, his acts contradict his claim of forgery, which appears to be an afterthought and a
last-ditch effort to recover the said property.

All told, we find no error on the part of the CA in upholding the validity of the mortgage contract.57

WHEREFORE, the Petition is hereby DENIED. The July 30 2008 Decision of the Court of Appeals in CA-G.R. CV No. 85139 is hereby AFFIRMED.

SO ORDERED.

4. G.R. No. 206248, February 18, 2014

GRACE M. GRANDE, Petitioner, v. PATRICIO T. ANTONIO, Respondent.

DECISION

VELASCO JR., J.:

Before this Court is a Petition for Review on Certiorari under Rule 45, assailing the July 24, 2012 Decision1 and March 5, 2013 Resolution2 of the Court of Appeals (CA) in CAG.R. CV
No. 96406.

As culled from the records, the facts of this case are:

Petitioner Grace Grande (Grande) and respondent Patricio Antonio (Antonio) for a period of time lived together as husband and wife, although Antonio was at that time already married
to someone else.3 Out of this illicit relationship, two sons were born: Andre Lewis (on February 8, 1998) and Jerard Patrick (on October 13, 1999).4 The children were not expressly
recognized by respondent as his own in the Record of Births of the children in the Civil Registry. The parties relationship, however, eventually turned sour, and Grande left for the
United States with her two children in May 2007. This prompted respondent Antonio to file a Petition for Judicial Approval of Recognition with Prayer to take Parental Authority, Parental
Physical Custody, Correction/Change of Surname of Minors and for the Issuance of Writ of Preliminary Injunction before the Regional Trial Court, Branch 8 of Aparri, Cagayan (RTC),
appending a notarized Deed of Voluntary Recognition of Paternity of the children.5

On September 28, 2010, the RTC rendered a Decision in favor of herein respondent Antonio, ruling that [t]he evidence at hand is overwhelming that the best interest of the children can
be promoted if they are under the sole parental authority and physical custody of [respondent Antonio].6 Thus, the court a quo decreed the following:

WHEREFORE, foregoing premises considered, the Court hereby grants [Antonios] prayer for recognition and the same is hereby judicially approved. x x x Consequently, the Court
forthwith issues the following Order granting the other reliefs sought in the Petition, to wit:

a.

Ordering the Office of the City Registrar of the City of Makati to cause the entry of the name of [Antonio] as the father of the aforementioned minors in their
respective Certificate of Live Birth and causing the correction/change and/or annotation of the surnames of said minors in their Certificate of Live
Birth from Grande to Antonio;

b.

Granting [Antonio] the right to jointly exercise Parental Authority with [Grande] over the persons of their minor children, Andre Lewis Grande and Jerard
Patrick Grande;

c.

Granting [Antonio] primary right and immediate custody over the parties minor children Andre Lewis Grandre and Jerard Patrick Grande who shall stay with
[Antonios] residence in the Philippines from Monday until Friday evening and to [Grandes] custody from Saturday to Sunday evening;

d.

Ordering [Grande] to immediately surrender the persons and custody of minors Andre Lewis Grande and Jerard Patrick Grande unto [Antonio] for the days
covered by the Order;

e.

Ordering parties to cease and desist from bringing the aforenamed minors outside of the country, without the written consent of the other and permission
from the court.

f.

Ordering parties to give and share the support of the minor children Andre Lewis Grande and Jerard Patrick Grande in the amount of P30,000 per month at
the rate of 70% for [Antonio] and 30% for [Grande].7 (Emphasis supplied.)

Aggrieved, petitioner Grande moved for reconsideration. However, her motion was denied by the trial court in its Resolution dated November 22, 20108 for being pro forma and for lack
of merit.

Petitioner Grande then filed an appeal with the CA attributing grave error on the part of the RTC for allegedly ruling contrary to the law and jurisprudence respecting the grant of sole
custody to the mother over her illegitimate children.9 In resolving the appeal, the appellate court modified in part the Decision of the RTC. The dispositive portion of the CA Decision
reads:

WHEREFORE, the appeal is partly GRANTED. Accordingly, the appealed Decision of the Regional Trial Court Branch 8, Aparri Cagayan in SP Proc. Case No. 114492 is MODIFIED
in part and shall hereinafter read as follows:

a.

The Offices of the Civil Registrar General and the City Civil Registrar of Makati City are DIRECTED to enter the surname Antonio as the surname
of Jerard Patrick and Andre Lewis, in their respective certificates of live birth, and record the same in the Register of Births;

b.

[Antonio] is ORDERED to deliver the minor children Jerard Patrick and Andre Lewis to the custody of their mother herein appellant, Grace Grande who by
virtue hereof is hereby awarded the full or sole custody of these minor children;

c.

[Antonio] shall have visitorial rights at least twice a week, and may only take the children out upon the written consent of [Grande]; and

d.

The parties are DIRECTED to give and share in support of the minor children Jerard Patrick and Andre Lewis in the amount of P30,000.00 per month at the
rate of 70% for [Antonio] and 30% for [Grande]. (Emphasis supplied.)

In ruling thus, the appellate court ratiocinated that notwithstanding the fathers recognition of his children, the mother cannot be deprived of her sole parental custody over them absent
the most compelling of reasons.10 Since respondent Antonio failed to prove that petitioner Grande committed any act that adversely affected the welfare of the children or rendered her
unsuitable to raise the minors, she cannot be deprived of her sole parental custody over their children.

The appellate court, however, maintained that the legal consequence of the recognition made by respondent Antonio that he is the father of the minors, taken in conjunction
with the universally protected bestinterestofthechild clause, compels the use by the children of the surname ANTONIO.11

As to the issue of support, the CA held that the grant is legally in order considering that not only did Antonio express his willingness to give support, it is also a consequence of his
acknowledging the paternity of the minor children.12 Lastly, the CA ruled that there is no reason to deprive respondent Antonio of his visitorial right especially in view of the
constitutionally inherent and natural right of parents over their children.13

Not satisfied with the CAs Decision, petitioner Grande interposed a partial motion for reconsideration, particularly assailing the order of the CA insofar as it decreed the change of the
minors surname to Antonio. When her motion was denied, petitioner came to this Court via the present petition. In it, she posits that Article 176 of the Family Codeas amended by
Republic Act No. (RA) 9255, couched as it is in permissive languagemay not be invoked by a father to compel the use by his illegitimate children of his surname without the consent
of their mother.

We find the present petition impressed with merit.

The sole issue at hand is the right of a father to compel the use of his surname by his illegitimate children upon his recognition of their filiation. Central to the core issue is the application
of Art. 176 of the Family Code, originally phrased as follows:

Illegitimate children shall use the surname and shall be under the parental authority of their mother, and shall be entitled to support in conformity with this Code. The legitime of each
illegitimate child shall consist of onehalf of the legitime of a legitimate child. Except for this modification, all other provisions in the Civil Code governing successional rights shall remain
in force.

This provision was later amended on March 19, 2004 by RA 925514 which now reads:

Art. 176. Illegitimate children shall use the surname and shall be under the parental authority of their mother, and shall be entitled to support in conformity with this Code.
However, illegitimate children may use the surname of their father if their filiation has been expressly recognized by their father through the record of birth appearing in the civil
register, or when an admission in a public document or private handwritten instrument is made by the father. Provided, the father has the right to institute an action before the regular
courts to prove nonfiliation during his lifetime. The legitime of each illegitimate child shall consist of onehalf of the legitime of a legitimate child. (Emphasis supplied.)

From the foregoing provisions, it is clear that the general rule is that an illegitimate child shall use the surname of his or her mother. The exception provided by RA 9255 is, in case his
or her filiation is expressly recognized by the father through the record of birth appearing in the civil register or when an admission in a public document or private handwritten
instrument is made by the father. In such a situation, the illegitimate child may use the surname of the father.

In the case at bar, respondent filed a petition for judicial approval of recognition of the filiation of the two children with the prayer for the correction or change of the surname of the
minors from Grande to Antonio when a public document acknowledged before a notary public under Sec. 19, Rule 132 of the Rules of Court15 is enough to establish the paternity of his
children. But he wanted more: a judicial conferment of parental authority, parental custody, and an official declaration of his childrens surname as Antonio.

Parental authority over minor children is lodged by Art. 176 on the mother; hence, respondents prayer has no legal mooring. Since parental authority is given to the mother, then
custody over the minor children also goes to the mother, unless she is shown to be unfit.

Now comes the matter of the change of surname of the illegitimate children. Is there a legal basis for the court a quo to order the change of the surname to that of respondent?

Clearly, there is none. Otherwise, the order or ruling will contravene the explicit and unequivocal provision of Art. 176 of the Family Code, as amended by RA 9255.

Art. 176 gives illegitimate children the right to decide if they want to use the surname of their father or not. It is not the father (herein respondent) or the mother (herein petitioner) who is
granted by law the right to dictate the surname of their illegitimate children.

Nothing is more settled than that when the law is clear and free from ambiguity, it must be taken to mean what it says and it must be given its literal meaning free from any
interpretation.16 Respondents position that the court can order the minors to use his surname, therefore, has no legal basis.

On its face, Art. 176, as amended, is free from ambiguity. And where there is no ambiguity, one must abide by its words. The use of the word may in the provision readily shows that
an acknowledged illegitimate child is under no compulsion to use the surname of his illegitimate father. The word may is permissive and operates to confer discretion17 upon
the illegitimate children.

It is best to emphasize once again that the yardstick by which policies affecting children are to be measured is their best interest. On the matter of childrens surnames, this Court has,
time and again, rebuffed the idea that the use of the fathers surname serves the best interest of the minor child. InAlfon v. Republic,18 for instance, this Court allowed even
a legitimate child to continue using the surname of her mother rather than that of her legitimate father as it serves her best interest and there is no legal obstacle to prevent her from
using the surname of her mother to which she is entitled. In fact, in Calderon v. Republic,19 this Court, upholding the best interest of the child concerned, even allowed the use of a
surname different from the surnames of the childs father or mother. Indeed, the rule regarding the use of a childs surname is second only to the rule requiring that the child be placed in
the best possible situation considering his circumstances.

In Republic of the Philippines v. Capote,20 We gave due deference to the choice of an illegitimate minor to use the surname of his mother as it would best serve his interest, thus:

The foregoing discussion establishes the significant connection of a persons name to his identity, his status in relation to his parents and his successional rights as a legitimate or
illegitimate child. For sure, these matters should not be taken lightly as to deprive those who may, in any way, be affected by the right to present evidence in favor of or against such
change.

The law and facts obtaining here favor Giovannis petition. Giovanni availed of the proper remedy, a petition for change of name under Rule 103 of the Rules of Court, and complied
with all the procedural requirements. After hearing, the trial court found (and the appellate court affirmed) that the evidence presented during the hearing of Giovannis petition
sufficiently established that, under Art. 176 of the Civil Code, Giovanni is entitled to change his name as he was never recognized by his father while his mother has always recognized
him as her child. A change of name will erase the impression that he was ever recognized by his father. It is also to his best interest as it will facilitate his mothers intended
petition to have him join her in the United States. This Court will not stand in the way of the reunification of mother and son. (Emphasis supplied.)

An argument, however, may be advanced advocating the mandatory use of the fathers surname upon his recognition of his illegitimate children, citing the Implementing Rules and
Regulations (IRR) of RA 9255,21 which states:

Rule 7. Requirements for the Child to Use the Surname of the Father

7.1 For Births Not Yet Registered

7.1.1 The illegitimate child shall use the surname of the father if a public document is executed by the father, either at the back of the Certificate of Live Birth or in a separate document.

7.1.2 If admission of paternity is made through a private instrument, the child shall use the surname of the father, provided the registration is supported by the following documents:

xxxx

7.2. For Births Previously Registered under the Surname of the Mother

7.2.1 If filiation has been expressly recognized by the father, the child shall use the surname of the father upon the submission of the accomplished AUSF [Affidavit of Use of the
Surname of the Father].

7.2.2 If filiation has not been expressly recognized by the father, the child shall use the surname of the father upon submission of a public document or a private handwritten instrument
supported by the documents listed in Rule 7.1.2.

7.3 Except in Item 7.2.1, the consent of the illegitimate child is required if he/she has reached the age of majority. The consent may be contained in a separate instrument duly
notarized.

xxxx

Rule 8. Effects of Recognition

8.1 For Births Not Yet Registered

8.1.1 The surname of the father shall be entered as the last name of the child in the Certificate of Live Birth. The Certificate of Live Birth shall be recorded in the Register of Births.

xxxx

8.2 For Births Previously Registered under the Surname of the Mother

8.2.1 If admission of paternity was made either at the back of the Certificate of Live Birth or in a separate public document or in a private handwritten document, the public document or
AUSF shall be recorded in the Register of Live Birth and the Register of Births as follows:

The surname of the child is hereby changed from (original surname) to (new surname) pursuant to RA 9255.

The original surname of the child appearing in the Certificate of Live Birth and Register of Births shall not be changed or deleted.

8.2.2 If filiation was not expressly recognized at the time of registration, the public document or AUSF shall be recorded in the Register of Legal Instruments. Proper annotation shall be
made in the Certificate of Live Birth and the Register of Births as follows:

Acknowledged by (name of father) on (date). The surname of the child ishereby changed from (original surname) on (date) pursuant to RA 9255. (Emphasis supplied.)

Nonetheless, the hornbook rule is that an administrative issuance cannot amend a legislative act. InMCC Industrial Sales Corp. v. Ssangyong Corporation,22 We held:

After all, the power of administrative officials to promulgate rules in the implementation of a statute is necessarily limited to what is found in the legislative enactment itself. The
implementing rules and regulations of a law cannot extend the law or expand its coverage, as the power to amend or repeal a statute is vested in the Legislature. Thus, if a discrepancy
occurs between the basic law and an implementing rule or regulation, it is the former that prevails, because the law cannot be broadened by a mere administrative issuance an
administrative agency certainly cannot amend an act of Congress.

Thus, We can disregard contemporaneous construction where there is no ambiguity in law and/or the construction is clearly erroneous.23 What is more, this Court has the constitutional
prerogative and authority to strike down and declare as void the rules of procedure of special courts and quasijudicial bodies24 when found contrary to statutes and/or the
Constitution.25 Section 5(5), Art. VIII of the Constitution provides:

Sec. 5. The Supreme Court shall have the following powers:

xxxx

(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice and procedure in all courts, the admission to the practice of law, the
Integrated Bar, and legal assistance to the underprivileged. Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of cases, shall be uniform for all
courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules of procedure of special courts and quasijudicial bodies shall remain effective
unless disapproved by the Supreme Court. (Emphasis supplied.)

Thus, We exercise this power in voiding the abovequoted provisions of the IRR of RA 9255 insofar as it provides the mandatory use by illegitimate children of their fathers surname
upon the latters recognition of his paternity.

To conclude, the use of the word shall in the IRR of RA 9255 is of no moment. The clear, unambiguous, and unequivocal use of may in Art. 176 rendering the use of an illegitimate
fathers surname discretionary controls, and illegitimate children are given the choice on the surnames by which they will be known.

At this juncture, We take note of the letters submitted by the children, now aged thirteen (13) and fifteen (15) years old, to this Court declaring their opposition to have their names
changed to Antonio.26 However, since these letters were not offered before and evaluated by the trial court, they do not provide any evidentiary weight to sway this Court to rule for or
against petitioner.27 A proper inquiry into, and evaluation of the evidence of, the childrens choice of surname by the trial court is necessary.

WHEREFORE, the instant petition is PARTIALLY GRANTED. The July 24, 2012 Decision of the Court of Appeals in CAG.R. CV No. 96406 is MODIFIED, the dispositive portion of
which shall read:

WHEREFORE, the appeal is partly GRANTED. Accordingly, the appealed Decision of the Regional Trial Court Branch 8, Aparri Cagayan in SP Proc. Case No. 114492 isMODIFIED in
part and shall hereinafter read as follows:

a.

[Antonio] is ORDERED to deliver the minor children Jerard Patrick and Andre Lewis to the custody of their mother herein appellant, Grace Grande who by
virtue hereof is hereby awarded the full or sole custody of these minor children;

b.

[Antonio] shall have visitation rights28 at least twice a week, and may only take the children out upon the written consent of [Grande];

c.

The parties are DIRECTED to give and share in support of the minor children Jerard Patrick and Andre Lewis in the amount of P30,000.00 per month at the
rate of 70% for [Antonio] and 30% for [Grande]; and

d.

The case is REMANDED to the Regional Trial Court, Branch 8 of Aparri, Cagayan for the sole purpose of determining the surname to be chosen
by the children Jerard Patrick and Andre Lewis.

Rule 7 and Rule 8 of the Office of the Civil Registrar General Administrative Order No. 1, Series of 2004 are DISAPPROVED and hereby declared NULL and VOID.

SO ORDERED.

5. G.R. No. 185595

January 9, 2013

MA. CARMINIA C. CALDERON represented by her Attorney-In-Fact, Marycris V. Baldevia, Petitioner,

vs.
JOSE ANTONIO F. ROXAS and COURT OF APPEALS, Respondents.

DECISION

VILLARAMA, JR., J.:

Before us is a petition for review on certiorari under Rule 45 assailing the Decision1 dated September 9, 2008 and Resolution2 dated December 15, 2008 of the Court of Appeals (CA)
in CA-G.R. CV No. 85384. The CA affirmed the Orders dated March 7, 2005 and May 4, 2005 of the Regional Trial Court (RTC) of Paraaque City, Branch 260 in Civil Case No. 970608.

Petitioner Ma. Carminia C. Calderon and private respondent Jose Antonio F. Roxas, were married on December 4, 1985 and their union produced four children. On January 16, 1998,
petitioner filed an Amended Complaint3 for the declaration of nullity of their marriage on the ground of psychological incapacity under Art. 36 of the Family Code of the Philippines.

On May 19, 1998, the trial court issued an Order4 granting petitioners application for support pendente lite. Said order states in part:

Accordingly, the defendant is hereby ordered to contribute to the support of the above-named minors, (aside from 50% of their school tuition fees which the defendant has agreed to
defray, plus expenses for books and other school supplies), the sum of P42,292.50 per month, effective May 1, 1998, as his share in the monthly support of the children, until further
orders from this Court. The first monthly contribution, i.e., for the month of May 1998, shall be given by the defendant to the plaintiff within five (5) days from receipt of a copy of this
Order. The succeeding monthly contributions of P42,292.50 shall be directly given by the defendant to the plaintiff without need of any demand, within the first five (5) days of each
month beginning June 1998. All expenses for books and other school supplies shall be shouldered by the plaintiff and the defendant, share and share alike. Finally, it is understood that
any claim for support-in-arrears prior to May 1, 1998, may be taken up later in the course of the proceedings proper.

xxxx

SO ORDERED.5

The aforesaid order and subsequent orders for support pendente lite were the subject of G.R. No. 139337 entitled "Ma. Carminia C. Roxas v. Court of Appeals and Jose Antonio F.
Roxas" decided by this Court on August 15, 2001.6 The Decision in said case declared that "the proceedings and orders issued by the trial court in the application for support pendente
lite (and the main complaint for annulment of marriage) in the re-filed case, that is, in Civil Case No. 97-0608 were not rendered null and void by the omission of a statement in the
certificate of non-forum shopping regarding the prior filing and dismissal without prejudice of Civil Case No. 97-0523 which involves the same parties." The assailed orders for support
pendente lite were thus reinstated and the trial court resumed hearing the main case.

On motion of petitioners counsel, the trial court issued an Order dated October 11, 2002 directing private respondent to give support in the amount of P42,292.50 per month starting
April 1, 1999 pursuant to the May 19, 1998 Order.7

On February 11, 2003, private respondent filed a Motion to Reduce Support citing, among other grounds, that the P42,292.50 monthly support for the children as fixed by the court was
even higher than his then P20,800.00 monthly salary as city councilor.8

After hearing, the trial court issued an Order9 dated March 7, 2005 granting the motion to reduce support and denying petitioners motion for spousal support, increase of the childrens
monthly support pendente lite and support-in-arrears. The trial court considered the following circumstances well-supported by documentary and testimonial evidence: (1) the spouses
eldest child, Jose Antonio, Jr. is a Sangguniang Kabataan Chairman and is already earning a monthly salary; (2) all the children stay with private respondent on weekends in their
house in Pasay City; (3) private respondent has no source of income except his salary and benefits as City Councilor; (4) the voluminous documents consisting of official receipts in
payment of various billings including school tuition fees, private tutorials and purchases of childrens school supplies, personal checks issued by private respondent, as well as his own
testimony in court, all of which substantiated his claim that he is fulfilling his obligation of supporting his minor children during the pendency of the action; (5) there is no proof presented
by petitioner that she is not gainfully employed, the spouses being both medical doctors; (6) the unrebutted allegation of private respondent that petitioner is already in the United

States; and (7) the alleged arrearages of private respondent was not substantiated by petitioner with any evidence while private respondent had duly complied with his obligation as
ordered by the court through his overpayments in other aspects such as the childrens school tuition fees, real estate taxes and other necessities.

Petitioners motion for partial reconsideration of the March 7, 2005 Order was denied on May 4, 2005.10

On May 16, 2005, the trial court rendered its Decision11 in Civil Case No. 97-0608 decreeing thus:

WHEREFORE, judgment is hereby rendered declaring (sic):

1. Declaring null and void the marriage between plaintiff Ma.Carmina C. Roxas and defendant Jose Antonio Roxas solemnized on December 4, 1985 at San Agustin Convent, in Manila.
The Local Civil Registrar of Manila is hereby ordered to cancel the marriage contract of the parties as appearing in the Registry of Marriage as the same is void;

2. Awarding the custody of the parties minor children Maria Antoinette Roxas, Julian Roxas and Richard Roxas to their mother herein petitioner, with the respondent hereby given his
visitorial and or custodial rights at [sic] the express conformity of petitioner.

3. Ordering the respondent Jose Antonio Roxas to provide support to the children in the amount of P30,000.00 a month, which support shall be given directly to petitioner whenever the
children are in her custody, otherwise, if the children are in the provisional custody of respondent, said amount of support shall be recorded properly as the amounts are being spent.
For that purpose the respondent shall then render a periodic report to petitioner and to the Court to show compliance and for monitoring. In addition, the respondent is ordered to
support the proper schooling of the children providing for the payment of the tuition fees and other school fees and charges including transportation expenses and allowances needed
by the children for their studies.

4. Dissolving the community property or conjugal partnership property of the parties as the case may be, in accordance with law.

Let copies of this decision be furnished the Office of the Solicitor General, the Office of the City Prosecutor, Paranaque City, and the City Civil Registrar of Paranaque City and Manila.

SO ORDERED.12

On June 14, 2005, petitioner through counsel filed a Notice of Appeal from the Orders dated March 7, 2005 and May 4, 2005.

In her appeal brief, petitioner emphasized that she is not appealing the Decision dated May 16, 2005 which had become final as no appeal therefrom had been brought by the parties or
the City Prosecutor or the Solicitor General. Petitioner pointed out that her appeal is "from the RTC Order dated March 7, 2005, issued prior to the rendition of the decision in the main
case", as well as the May 4, 2005 Order denying her motion for partial reconsideration.13

By Decision dated September 9, 2008, the CA dismissed the appeal on the ground that granting the appeal would disturb the RTC Decision of May 16, 2005 which had long become
final and executory. The CA further noted that petitioner failed to avail of the proper remedy to question an interlocutory order.

Petitioners motion for reconsideration was likewise denied by the CA.

Hence, this petition raising the following issues:

A. DID THE CA COMMIT A GRAVE ABUSE OF DISCRETION and/or REVERSIBLE ERROR WHEN IT RULED THAT THE RTC ORDERS DATED MARCH 7, 2005 AND
MAY 4, 2005 ARE MERELY INTERLOCUTORY?

B. DID THE CA COMMIT A GRAVE ABUSE OF DISCRETION and/or REVERSIBLE ERROR WHEN IT DISMISSED OUTRIGHT THE APPEAL FROM SAID RTC
ORDERS, WHEN IT SHOULD HAVE DECIDED THE APPEAL ON THE MERITS?14

The core issue presented is whether the March 7, 2005 and May 4, 2005 Orders on the matter of support pendente lite are interlocutory or final.

This Court has laid down the distinction between interlocutory and final orders, as follows:

x x x A "final" judgment or order is one that finally disposes of a case, leaving nothing more to be done by the Court in respect thereto, e.g., an adjudication on the merits which, on the
basis of the evidence presented at the trial, declares categorically what the rights and obligations of the parties are and which party is in the right; or a judgment or order that dismisses
an action on the ground, for instance, of res judicata or prescription. Once rendered, the task of the Court is ended, as far as deciding the controversy or determining the rights and
liabilities of the litigants is concerned. Nothing more remains to be done by the Court except to await the parties next move (which among others, may consist of the filing of a motion for
new trial or reconsideration, or the taking of an appeal) and ultimately, of course, to cause the execution of the judgment once it becomes "final" or, to use the established and more
distinctive term, "final and executory."

xxxx

Conversely, an order that does not finally dispose of the case, and does not end the Courts task of adjudicating the parties contentions and determining their rights and liabilities as
regards each other, but obviously indicates that other things remain to be done by the Court, is "interlocutory" e.g., an order denying a motion to dismiss under Rule 16 of the Rules, or
granting a motion for extension of time to file a pleading, or authorizing amendment thereof, or granting or denying applications for postponement, or production or inspection of
documents or things, etc. Unlike a "final" judgment or order, which is appealable, as above pointed out, an "interlocutory" order may not be questioned on appeal except only as part of
an appeal that may eventually be taken from the final judgment rendered in the case.15 [Emphasis supplied]

The assailed orders relative to the incident of support pendente lite and support in arrears, as the term suggests, were issued pending the rendition of the decision on the main action
for declaration of nullity of marriage, and are therefore interlocutory. They did not finally dispose of the case nor did they consist of a final adjudication of the merits of petitioners claims
as to the ground of psychological incapacity and other incidents as child custody, support and conjugal assets.

The Rules of Court provide for the provisional remedy of support pendente lite which may be availed of at the commencement of the proper action or proceeding, or at any time prior to
the judgment or final order.16 On March 4, 2003, this Court promulgated the Rule on Provisional Orders17 which shall govern the issuance of provisional orders during the pendency of
cases for the declaration of nullity of marriage, annulment of voidable marriage and legal separation. These include orders for spousal support, child support, child custody, visitation
rights, hold departure, protection and administration of common property.

Petitioner contends that the CA failed to recognize that the interlocutory aspect of the assailed orders pertains only to private respondents motion to reduce support which was granted,
and to her own motion to increase support, which was denied. Petitioner points out that the ruling on support in arrears which have remained unpaid, as well as her prayer for
reimbursement/payment under the May 19, 1998 Order and related orders were in the nature of final orders assailable by ordinary appeal considering that the orders referred to under
Sections 1 and 4 of Rule 61 of the Rules of Court can apply only prospectively. Thus, from the moment the accrued amounts became due and demandable, the orders under which the
amounts were made payable by private respondent have ceased to be provisional and have become final.

We disagree.

The word interlocutory refers to something intervening between the commencement and the end of the suit which decides some point or matter but is not a final decision of the whole
controversy.18 An interlocutory order merely resolves incidental matters and leaves something more to be done to resolve the merits of the case. In contrast, a judgment or order is
considered final if the order disposes of the action or proceeding completely, or terminates a particular stage of the same action.19 Clearly, whether an order or resolution is final or
interlocutory is not dependent on compliance or non-compliance by a party to its directive, as what petitioner suggests. It is also important to emphasize the temporary or provisional
nature of the assailed orders.

Provisional remedies are writs and processes available during the pendency of the action which may be resorted to by a litigant to preserve and protect certain rights and interests
therein pending rendition, and for purposes of the ultimate effects, of a final judgment in the case. They are provisional because they constitute temporary measures availed of during
the pendency of the action, and they are ancillary because they are mere incidents in and are dependent upon the result of the main action.20 The subject orders on the matter of
support pendente lite are but an incident to the main action for declaration of nullity of marriage.

Moreover, private respondents obligation to give monthly support in the amount fixed by the RTC in the assailed orders may be enforced by the court itself, as what transpired in the
early stage of the proceedings when the court cited the private respondent in contempt of court and ordered him arrested for his refusal/failure to comply with the order granting support
pendente lite.21 A few years later, private respondent filed a motion to reduce support while petitioner filed her own motion to increase the same, and in addition sought spousal support
and support in arrears. This fact underscores the provisional character of the order granting support pendente lite. Petitioners theory that the assailed orders have ceased to be
provisional due to the arrearages incurred by private respondent is therefore untenable.1wphi1

Under Section 1, Rule 41 of the 1997 Revised Rules of Civil Procedure, as amended, appeal from interlocutory orders is not allowed. Said provision reads:

SECTION 1. Subject of appeal. - An appeal may be taken from a judgment or final order that completely disposes of the case, or of a particular matter therein when declared by these
Rules to be appealable.

No appeal may be taken from:

(a) An order denying a motion for new trial or reconsideration;

(b) An order denying a petition for relief or any similar motion seeking relief from judgment;

(c) An interlocutory order;

(d) An order disallowing or dismissing an appeal;

(e) An order denying a motion to set aside a judgment by consent, confession or compromise on the ground of fraud, mistake or duress, or any other ground vitiating
consent;

(f) An order of execution;

(g) A judgment or final order for or against one or more of several parties or in separate claims, counterclaims, cross-claims and third-party complaints, while the main
case is pending, unless the court allows an appeal therefrom; and

(h) An order dismissing an action without prejudice;

In all the above instances where the judgment or final order is not appealable, the aggrieved party may file an appropriate special civil action under Rule 65. (Emphasis supplied.)

The remedy against an interlocutory order not subject of an appeal is an appropriate special civil action under Rule 65 provided that the interlocutory order is rendered without or in
excess of jurisdiction or with grave abuse of discretion. Having chosen the wrong remedy in questioning the subject interlocutory orders of the RTC, petitioner's appeal was correctly
dismissed by the CA.

WHEREFORE, the petition for review on certiorari is DENIED, for lack of merit. The Decision dated September 9, 2008 and Resolution dated December 15, 2008 of the Court of
Appeals in CA-G.R. CV No. 85384 are AFFIRMED.

With costs against the petitioner.

SO ORDERED.

6. G.R. No. 196049

June 26, 2013

MINORU FUJIKI, PETITIONER,

vs.
MARIA PAZ GALELA MARINAY, SHINICHI MAEKARA, LOCAL CIVIL REGISTRAR OF QUEZON CITY, AND THE ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE
NATIONAL STATISTICS OFFICE,RESPONDENTS.

DECISION

CARPIO, J.:

The Case

This is a direct recourse to this Court from the Regional Trial Court (RTC), Branch 107, Quezon City, through a petition for review on certiorari under Rule 45 of the Rules of Court on a
pure question of law. The petition assails the Order1 dated 31 January 2011 of the RTC in Civil Case No. Q-11-68582 and its Resolution dated 2 March 2011 denying petitioners
Motion for Reconsideration. The RTC dismissed the petition for "Judicial Recognition of Foreign Judgment (or Decree of Absolute Nullity of Marriage)" based on improper venue and the
lack of personality of petitioner, Minoru Fujiki, to file the petition.

The Facts

Petitioner Minoru Fujiki (Fujiki) is a Japanese national who married respondent Maria Paz Galela Marinay (Marinay) in the Philippines2 on 23 January 2004. The marriage did not sit
well with petitioners parents. Thus, Fujiki could not bring his wife to Japan where he resides. Eventually, they lost contact with each other.

In 2008, Marinay met another Japanese, Shinichi Maekara (Maekara). Without the first marriage being dissolved, Marinay and Maekara were married on 15 May 2008 in Quezon City,
Philippines. Maekara brought Marinay to Japan. However, Marinay allegedly suffered physical abuse from Maekara. She left Maekara and started to contact Fujiki.3

Fujiki and Marinay met in Japan and they were able to reestablish their relationship. In 2010, Fujiki helped Marinay obtain a judgment from a family court in Japan which declared the
marriage between Marinay and Maekara void on the ground of bigamy.4 On 14 January 2011, Fujiki filed a petition in the RTC entitled: "Judicial Recognition of Foreign Judgment (or
Decree of Absolute Nullity of Marriage)." Fujiki prayed that (1) the Japanese Family Court judgment be recognized; (2) that the bigamous marriage between Marinay and Maekara be
declared void ab initiounder Articles 35(4) and 41 of the Family Code of the Philippines;5 and (3) for the RTC to direct the Local Civil Registrar of Quezon City to annotate the Japanese
Family Court judgment on the Certificate of Marriage between Marinay and Maekara and to endorse such annotation to the Office of the Administrator and Civil Registrar General in the
National Statistics Office (NSO).6

The Ruling of the Regional Trial Court

A few days after the filing of the petition, the RTC immediately issued an Order dismissing the petition and withdrawing the case from its active civil docket.7 The RTC cited the following
provisions of the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A.M. No. 02-11-10-SC):

Sec. 2. Petition for declaration of absolute nullity of void marriages.

(a) Who may file. A petition for declaration of absolute nullity of void marriage may be filed solely by the husband or the wife.

xxxx

Sec. 4. Venue. The petition shall be filed in the Family Court of the province or city where the petitioner or the respondent has been residing for at least six months prior to the date of
filing, or in the case of a non-resident respondent, where he may be found in the Philippines, at the election of the petitioner. x x x

The RTC ruled, without further explanation, that the petition was in "gross violation" of the above provisions. The trial court based its dismissal on Section 5(4) of A.M. No. 02-11-10-SC
which provides that "[f]ailure to comply with any of the preceding requirements may be a ground for immediate dismissal of the petition."8 Apparently, the RTC took the view that only
"the husband or the wife," in this case either Maekara or Marinay, can file the petition to declare their marriage void, and not Fujiki.

Fujiki moved that the Order be reconsidered. He argued that A.M. No. 02-11-10-SC contemplated ordinary civil actions for declaration of nullity and annulment of marriage. Thus, A.M.
No. 02-11-10-SC does not apply. A petition for recognition of foreign judgment is a special proceeding, which "seeks to establish a status, a right or a particular fact,"9 and not a civil
action which is "for the enforcement or protection of a right, or the prevention or redress of a wrong."10 In other words, the petition in the RTC sought to establish (1) the status and
concomitant rights of Fujiki and Marinay as husband and wife and (2) the fact of the rendition of the Japanese Family Court judgment declaring the marriage between Marinay and
Maekara as void on the ground of bigamy. The petitioner contended that the Japanese judgment was consistent with Article 35(4) of the Family Code of the Philippines11 on bigamy
and was therefore entitled to recognition by Philippine courts.12

In any case, it was also Fujikis view that A.M. No. 02-11-10-SC applied only to void marriages under Article 36 of the Family Code on the ground of psychological incapacity.13 Thus,
Section 2(a) of A.M. No. 02-11-10-SC provides that "a petition for declaration of absolute nullity of void marriages may be filed solely by the husband or the wife." To apply Section 2(a)
in bigamy would be absurd because only the guilty parties would be permitted to sue. In the words of Fujiki, "[i]t is not, of course, difficult to realize that the party interested in having a
bigamous marriage declared a nullity would be the husband in the prior, pre-existing marriage."14 Fujiki had material interest and therefore the personality to nullify a bigamous
marriage.

Fujiki argued that Rule 108 (Cancellation or Correction of Entries in the Civil Registry) of the Rules of Court is applicable. Rule 108 is the "procedural implementation" of the Civil
Register Law (Act No. 3753)15 in relation to Article 413 of the Civil Code.16 The Civil Register Law imposes a duty on the "successful petitioner for divorce or annulment of marriage to
send a copy of the final decree of the court to the local registrar of the municipality where the dissolved or annulled marriage was solemnized."17 Section 2 of Rule 108 provides that
entries in the civil registry relating to "marriages," "judgments of annulments of marriage" and "judgments declaring marriages void from the beginning" are subject to cancellation or
correction.18 The petition in the RTC sought (among others) to annotate the judgment of the Japanese Family Court on the certificate of marriage between Marinay and Maekara.

Fujikis motion for reconsideration in the RTC also asserted that the trial court "gravely erred" when, on its own, it dismissed the petition based on improper venue. Fujiki stated that the
RTC may be confusing the concept of venue with the concept of jurisdiction, because it is lack of jurisdiction which allows a court to dismiss a case on its own. Fujiki cited Dacoycoy v.
Intermediate Appellate Court19 which held that the "trial court cannot pre-empt the defendants prerogative to object to the improper laying of the venue by motu proprio dismissing the
case."20Moreover, petitioner alleged that the trial court should not have "immediately dismissed" the petition under Section 5 of A.M. No. 02-11-10-SC because he substantially
complied with the provision.

On 2 March 2011, the RTC resolved to deny petitioners motion for reconsideration. In its Resolution, the RTC stated that A.M. No. 02-11-10-SC applies because the petitioner, in
effect, prays for a decree of absolute nullity of marriage.21 The trial court reiterated its two grounds for dismissal, i.e. lack of personality to sue and improper venue under Sections 2(a)
and 4 of A.M. No. 02-11-10-SC. The RTC considered Fujiki as a "third person"22 in the proceeding because he "is not the husband in the decree of divorce issued by the Japanese
Family Court, which he now seeks to be judicially recognized, x x x."23 On the other hand, the RTC did not explain its ground of impropriety of venue. It only said that "[a]lthough the
Court cited Sec. 4 (Venue) x x x as a ground for dismissal of this case[,] it should be taken together with the other ground cited by the Court x x x which is Sec. 2(a) x x x."24

The RTC further justified its motu proprio dismissal of the petition based on Braza v. The City Civil Registrar of Himamaylan City, Negros Occidental.25 The Court in Braza ruled that
"[i]n a special proceeding for correction of entry under Rule 108 (Cancellation or Correction of Entries in the Original Registry), the trial court has no jurisdiction to nullify marriages x x
x."26 Braza emphasized that the "validity of marriages as well as legitimacy and filiation can be questioned only in a direct action seasonably filed by the proper party, and not through a
collateral attack such as [a] petition [for correction of entry] x x x."27

The RTC considered the petition as a collateral attack on the validity of marriage between Marinay and Maekara. The trial court held that this is a "jurisdictional ground" to dismiss the
petition.28 Moreover, the verification and certification against forum shopping of the petition was not authenticated as required under Section 529 of A.M. No. 02-11-10-SC. Hence, this
also warranted the "immediate dismissal" of the petition under the same provision.

The Manifestation and Motion of the Office of the Solicitor General and the Letters of Marinay and Maekara

On 30 May 2011, the Court required respondents to file their comment on the petition for review.30 The public respondents, the Local Civil Registrar of Quezon City and the
Administrator and Civil Registrar General of the NSO, participated through the Office of the Solicitor General. Instead of a comment, the Solicitor General filed a Manifestation and
Motion.31

The Solicitor General agreed with the petition. He prayed that the RTCs "pronouncement that the petitioner failed to comply with x x x A.M. No. 02-11-10-SC x x x be set aside" and that
the case be reinstated in the trial court for further proceedings.32 The Solicitor General argued that Fujiki, as the spouse of the first marriage, is an injured party who can sue to declare
the bigamous marriage between Marinay and Maekara void. The Solicitor General cited Juliano-Llave v. Republic33 which held that Section 2(a) of A.M. No. 02-11-10-SC does not
apply in cases of bigamy. In Juliano-Llave, this Court explained:

[t]he subsequent spouse may only be expected to take action if he or she had only discovered during the connubial period that the marriage was bigamous, and especially if the
conjugal bliss had already vanished. Should parties in a subsequent marriage benefit from the bigamous marriage, it would not be expected that they would file an action to declare the
marriage void and thus, in such circumstance, the "injured spouse" who should be given a legal remedy is the one in a subsisting previous marriage. The latter is clearly the aggrieved
party as the bigamous marriage not only threatens the financial and the property ownership aspect of the prior marriage but most of all, it causes an emotional burden to the prior
spouse. The subsequent marriage will always be a reminder of the infidelity of the spouse and the disregard of the prior marriage which sanctity is protected by the Constitution.34

The Solicitor General contended that the petition to recognize the Japanese Family Court judgment may be made in a Rule 108 proceeding.35 In Corpuz v. Santo Tomas,36 this Court
held that "[t]he recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself, as the object of special proceedings (such as that in Rule 108 of the Rules of
Court) is precisely to establish the status or right of a party or a particular fact."37 While Corpuzconcerned a foreign divorce decree, in the present case the Japanese Family Court
judgment also affected the civil status of the parties, especially Marinay, who is a Filipino citizen.

The Solicitor General asserted that Rule 108 of the Rules of Court is the procedure to record "[a]cts, events and judicial decrees concerning the civil status of persons" in the civil
registry as required by Article 407 of the Civil Code. In other words, "[t]he law requires the entry in the civil registry of judicial decrees that produce legal consequences upon a persons
legal capacity and status x x x."38 The Japanese Family Court judgment directly bears on the civil status of a Filipino citizen and should therefore be proven as a fact in a Rule 108
proceeding.

Moreover, the Solicitor General argued that there is no jurisdictional infirmity in assailing a void marriage under Rule 108, citing De Castro v. De Castro39 and Nial v. Bayadog40 which
declared that "[t]he validity of a void marriage may be collaterally attacked."41

Marinay and Maekara individually sent letters to the Court to comply with the directive for them to comment on the petition.42 Maekara wrote that Marinay concealed from him the fact
that she was previously married to Fujiki.43Maekara also denied that he inflicted any form of violence on Marinay.44 On the other hand, Marinay wrote that she had no reason to
oppose the petition.45 She would like to maintain her silence for fear that anything she say might cause misunderstanding between her and Fujiki.46

The Issues

Petitioner raises the following legal issues:

(1) Whether the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A.M. No. 02-11-10-SC) is applicable.

(2) Whether a husband or wife of a prior marriage can file a petition to recognize a foreign judgment nullifying the subsequent marriage between his or her spouse and a
foreign citizen on the ground of bigamy.

(3) Whether the Regional Trial Court can recognize the foreign judgment in a proceeding for cancellation or correction of entries in the Civil Registry under Rule 108 of the
Rules of Court.

The Ruling of the Court

We grant the petition.

The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A.M. No. 02-11-10-SC) does not apply in a petition to recognize a foreign judgment
relating to the status of a marriage where one of the parties is a citizen of a foreign country. Moreover, in Juliano-Llave v. Republic,47 this Court held that the rule in A.M. No. 02-11-10SC that only the husband or wife can file a declaration of nullity or annulment of marriage "does not apply if the reason behind the petition is bigamy."48

I.

For Philippine courts to recognize a foreign judgment relating to the status of a marriage where one of the parties is a citizen of a foreign country, the petitioner only needs to prove the
foreign judgment as a fact under the Rules of Court. To be more specific, a copy of the foreign judgment may be admitted in evidence and proven as a fact under Rule 132, Sections 24
and 25, in relation to Rule 39, Section 48(b) of the Rules of Court.49 Petitioner may prove the Japanese Family Court judgment through (1) an official publication or (2) a certification or
copy attested by the officer who has custody of the judgment. If the office which has custody is in a foreign country such as Japan, the certification may be made by the proper
diplomatic or consular officer of the Philippine foreign service in Japan and authenticated by the seal of office.50

To hold that A.M. No. 02-11-10-SC applies to a petition for recognition of foreign judgment would mean that the trial court and the parties should follow its provisions, including the form
and contents of the petition,51 the service of summons,52 the investigation of the public prosecutor,53 the setting of pre-trial,54 the trial55 and the judgment of the trial court.56 This is
absurd because it will litigate the case anew. It will defeat the purpose of recognizing foreign judgments, which is "to limit repetitive litigation on claims and issues."57 The interpretation
of the RTC is tantamount to relitigating the case on the merits. In Mijares v. Raada,58 this Court explained that "[i]f every judgment of a foreign court were reviewable on the merits, the
plaintiff would be forced back on his/her original cause of action, rendering immaterial the previously concluded litigation."59

A foreign judgment relating to the status of a marriage affects the civil status, condition and legal capacity of its parties. However, the effect of a foreign judgment is not automatic. To
extend the effect of a foreign judgment in the Philippines, Philippine courts must determine if the foreign judgment is consistent with domestic public policy and other mandatory
laws.60 Article 15 of the Civil Code provides that "[l]aws relating to family rights and duties, or to the status, condition and legal capacity of persons are binding upon citizens of the
Philippines, even though living abroad." This is the rule of lex nationalii in private international law. Thus, the Philippine State may require, for effectivity in the Philippines, recognition by
Philippine courts of a foreign judgment affecting its citizen, over whom it exercises personal jurisdiction relating to the status, condition and legal capacity of such citizen.

A petition to recognize a foreign judgment declaring a marriage void does not require relitigation under a Philippine court of the case as if it were a new petition for declaration of nullity
of marriage. Philippine courts cannot presume to know the foreign laws under which the foreign judgment was rendered. They cannot substitute their judgment on the status, condition
and legal capacity of the foreign citizen who is under the jurisdiction of another state. Thus, Philippine courts can only recognize the foreign judgment as a fact according to the rules of
evidence.

Section 48(b), Rule 39 of the Rules of Court provides that a foreign judgment or final order against a person creates a "presumptive evidence of a right as between the parties and their
successors in interest by a subsequent title." Moreover, Section 48 of the Rules of Court states that "the judgment or final order may be repelled by evidence of a want of jurisdiction,
want of notice to the party, collusion, fraud, or clear mistake of law or fact." Thus, Philippine courts exercise limited review on foreign judgments. Courts are not allowed to delve into the
merits of a foreign judgment. Once a foreign judgment is admitted and proven in a Philippine court, it can only be repelled on grounds external to its merits, i.e. , "want of jurisdiction,
want of notice to the party, collusion, fraud, or clear mistake of law or fact." The rule on limited review embodies the policy of efficiency and the protection of party expectations,61 as
well as respecting the jurisdiction of other states.62

Since 1922 in Adong v. Cheong Seng Gee,63 Philippine courts have recognized foreign divorce decrees between a Filipino and a foreign citizen if they are successfully proven under
the rules of evidence.64 Divorce involves the dissolution of a marriage, but the recognition of a foreign divorce decree does not involve the extended procedure under A.M. No. 02-1110-SC or the rules of ordinary trial. While the Philippines does not have a divorce law, Philippine courts may, however, recognize a foreign divorce decree under the second paragraph
of Article 26 of the Family Code, to capacitate a Filipino citizen to remarry when his or her foreign spouse obtained a divorce decree abroad.65

There is therefore no reason to disallow Fujiki to simply prove as a fact the Japanese Family Court judgment nullifying the marriage between Marinay and Maekara on the ground of
bigamy. While the Philippines has no divorce law, the Japanese Family Court judgment is fully consistent with Philippine public policy, as bigamous marriages are declared void from
the beginning under Article 35(4) of the Family Code. Bigamy is a crime under Article 349 of the Revised Penal Code. Thus, Fujiki can prove the existence of the Japanese Family Court
judgment in accordance with Rule 132, Sections 24 and 25, in relation to Rule 39, Section 48(b) of the Rules of Court.

II.

Since the recognition of a foreign judgment only requires proof of fact of the judgment, it may be made in a special proceeding for cancellation or correction of entries in the civil registry
under Rule 108 of the Rules of Court. Rule 1, Section 3 of the Rules of Court provides that "[a] special proceeding is a remedy by which a party seeks to establish a status, a right, or a
particular fact." Rule 108 creates a remedy to rectify facts of a persons life which are recorded by the State pursuant to the Civil Register Law or Act No. 3753. These are facts of public
consequence such as birth, death or marriage,66 which the State has an interest in recording. As noted by the Solicitor General, in Corpuz v. Sto. Tomas this Court declared that "[t]he
recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself, as the object of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely
to establish the status or right of a party or a particular fact."67

Rule 108, Section 1 of the Rules of Court states:

Sec. 1. Who may file petition. Any person interested in any act, event, order or decree concerning the civil status of persons which has been recorded in the civil
register, may file a verified petition for the cancellation or correction of any entry relating thereto, with the Regional Trial Court of the province where the corresponding civil registry is
located. (Emphasis supplied)

Fujiki has the personality to file a petition to recognize the Japanese Family Court judgment nullifying the marriage between Marinay and Maekara on the ground of bigamy because the
judgment concerns his civil status as married to Marinay. For the same reason he has the personality to file a petition under Rule 108 to cancel the entry of marriage between Marinay
and Maekara in the civil registry on the basis of the decree of the Japanese Family Court.

There is no doubt that the prior spouse has a personal and material interest in maintaining the integrity of the marriage he contracted and the property relations arising from it. There is
also no doubt that he is interested in the cancellation of an entry of a bigamous marriage in the civil registry, which compromises the public record of his marriage. The interest derives
from the substantive right of the spouse not only to preserve (or dissolve, in limited instances68) his most intimate human relation, but also to protect his property interests that arise by
operation of law the moment he contracts marriage.69 These property interests in marriage include the right to be supported "in keeping with the financial capacity of the family"70 and
preserving the property regime of the marriage.71

Property rights are already substantive rights protected by the Constitution,72 but a spouses right in a marriage extends further to relational rights recognized under Title III ("Rights and
Obligations between Husband and Wife") of the Family Code.73 A.M. No. 02-11-10-SC cannot "diminish, increase, or modify" the substantive right of the spouse to maintain the
integrity of his marriage.74 In any case, Section 2(a) of A.M. No. 02-11-10-SC preserves this substantive right by limiting the personality to sue to the husband or the wife of the union
recognized by law.

Section 2(a) of A.M. No. 02-11-10-SC does not preclude a spouse of a subsisting marriage to question the validity of a subsequent marriage on the ground of bigamy. On the contrary,
when Section 2(a) states that "[a] petition for declaration of absolute nullity of void marriage may be filed solely by the husband or the wife"75it refers to the husband or the wife of
the subsisting marriage. Under Article 35(4) of the Family Code, bigamous marriages are void from the beginning. Thus, the parties in a bigamous marriage are neither the husband nor
the wife under the law. The husband or the wife of the prior subsisting marriage is the one who has the personality to file a petition for declaration of absolute nullity of void marriage
under Section 2(a) of A.M. No. 02-11-10-SC.

Article 35(4) of the Family Code, which declares bigamous marriages void from the beginning, is the civil aspect of Article 349 of the Revised Penal Code,76 which penalizes bigamy.
Bigamy is a public crime. Thus, anyone can initiate prosecution for bigamy because any citizen has an interest in the prosecution and prevention of crimes.77 If anyone can file a
criminal action which leads to the declaration of nullity of a bigamous marriage,78 there is more reason to confer personality to sue on the husband or the wife of a subsisting marriage.
The prior spouse does not only share in the public interest of prosecuting and preventing crimes, he is also personally interested in the purely civil aspect of protecting his marriage.

When the right of the spouse to protect his marriage is violated, the spouse is clearly an injured party and is therefore interested in the judgment of the suit.79 Juliano-Llave ruled that
the prior spouse "is clearly the aggrieved party as the bigamous marriage not only threatens the financial and the property ownership aspect of the prior marriage but most of all, it
causes an emotional burden to the prior spouse."80 Being a real party in interest, the prior spouse is entitled to sue in order to declare a bigamous marriage void. For this purpose, he
can petition a court to recognize a foreign judgment nullifying the bigamous marriage and judicially declare as a fact that such judgment is effective in the Philippines. Once established,
there should be no more impediment to cancel the entry of the bigamous marriage in the civil registry.

III.

In Braza v. The City Civil Registrar of Himamaylan City, Negros Occidental, this Court held that a "trial court has no jurisdiction to nullify marriages" in a special proceeding for
cancellation or correction of entry under Rule 108 of the Rules of Court.81 Thus, the "validity of marriage[] x x x can be questioned only in a direct action" to nullify the marriage.82 The
RTC relied on Braza in dismissing the petition for recognition of foreign judgment as a collateral attack on the marriage between Marinay and Maekara.

Braza is not applicable because Braza does not involve a recognition of a foreign judgment nullifying a bigamous marriage where one of the parties is a citizen of the foreign country.

To be sure, a petition for correction or cancellation of an entry in the civil registry cannot substitute for an action to invalidate a marriage. A direct action is necessary to prevent
circumvention of the substantive and procedural safeguards of marriage under the Family Code, A.M. No. 02-11-10-SC and other related laws. Among these safeguards are the
requirement of proving the limited grounds for the dissolution of marriage,83 support pendente lite of the spouses and children,84 the liquidation, partition and distribution of the
properties of the spouses,85 and the investigation of the public prosecutor to determine collusion.86 A direct action for declaration of nullity or annulment of marriage is also necessary
to prevent circumvention of the jurisdiction of the Family Courts under the Family Courts Act of 1997 (Republic Act No. 8369), as a petition for cancellation or correction of entries in the

civil registry may be filed in the Regional Trial Court "where the corresponding civil registry is located."87 In other words, a Filipino citizen cannot dissolve his marriage by the mere
expedient of changing his entry of marriage in the civil registry.

However, this does not apply in a petition for correction or cancellation of a civil registry entry based on the recognition of a foreign judgment annulling a marriage where one of the
parties is a citizen of the foreign country. There is neither circumvention of the substantive and procedural safeguards of marriage under Philippine law, nor of the jurisdiction of Family
Courts under R.A. No. 8369. A recognition of a foreign judgment is not an action to nullify a marriage. It is an action for Philippine courts to recognize the effectivity of a foreign
judgment, which presupposes a case which was already tried and decided under foreign law. The procedure in A.M. No. 02-11-10-SC does not apply in a petition to recognize a
foreign judgment annulling a bigamous marriage where one of the parties is a citizen of the foreign country. Neither can R.A. No. 8369 define the jurisdiction of the foreign court.

Article 26 of the Family Code confers jurisdiction on Philippine courts to extend the effect of a foreign divorce decree to a Filipino spouse without undergoing trial to determine the
validity of the dissolution of the marriage. The second paragraph of Article 26 of the Family Code provides that "[w]here a marriage between a Filipino citizen and a foreigner is validly
celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall have capacity to remarry under Philippine
law." In Republic v. Orbecido,88 this Court recognized the legislative intent of the second paragraph of Article 26 which is "to avoid the absurd situation where the Filipino spouse
remains married to the alien spouse who, after obtaining a divorce, is no longer married to the Filipino spouse"89 under the laws of his or her country. The second paragraph of Article
26 of the Family Code only authorizes Philippine courts to adopt the effects of a foreign divorce decree precisely because the Philippines does not allow divorce. Philippine courts
cannot try the case on the merits because it is tantamount to trying a case for divorce.

The second paragraph of Article 26 is only a corrective measure to address the anomaly that results from a marriage between a Filipino, whose laws do not allow divorce, and a foreign
citizen, whose laws allow divorce. The anomaly consists in the Filipino spouse being tied to the marriage while the foreign spouse is free to marry under the laws of his or her country.
The correction is made by extending in the Philippines the effect of the foreign divorce decree, which is already effective in the country where it was rendered. The second paragraph of
Article 26 of the Family Code is based on this Courts decision in Van Dorn v. Romillo90 which declared that the Filipino spouse "should not be discriminated against in her own country
if the ends of justice are to be served."91

The principle in Article 26 of the Family Code applies in a marriage between a Filipino and a foreign citizen who obtains a foreign judgment nullifying the marriage on the ground of
bigamy. The Filipino spouse may file a petition abroad to declare the marriage void on the ground of bigamy. The principle in the second paragraph of Article 26 of the Family Code
applies because the foreign spouse, after the foreign judgment nullifying the marriage, is capacitated to remarry under the laws of his or her country. If the foreign judgment is not
recognized in the Philippines, the Filipino spouse will be discriminatedthe foreign spouse can remarry while the Filipino spouse cannot remarry.

Under the second paragraph of Article 26 of the Family Code, Philippine courts are empowered to correct a situation where the Filipino spouse is still tied to the marriage while the
foreign spouse is free to marry. Moreover, notwithstanding Article 26 of the Family Code, Philippine courts already have jurisdiction to extend the effect of a foreign judgment in the
Philippines to the extent that the foreign judgment does not contravene domestic public policy. A critical difference between the case of a foreign divorce decree and a foreign judgment
nullifying a bigamous marriage is that bigamy, as a ground for the nullity of marriage, is fully consistent with Philippine public policy as expressed in Article 35(4) of the Family Code and
Article 349 of the Revised Penal Code. The Filipino spouse has the option to undergo full trial by filing a petition for declaration of nullity of marriage under A.M. No. 02-11-10-SC, but
this is not the only remedy available to him or her. Philippine courts have jurisdiction to recognize a foreign judgment nullifying a bigamous marriage, without prejudice to a criminal
prosecution for bigamy.

In the recognition of foreign judgments, Philippine courts are incompetent to substitute their judgment on how a case was decided under foreign law. They cannot decide on the "family
rights and duties, or on the status, condition and legal capacity" of the foreign citizen who is a party to the foreign judgment. Thus, Philippine courts are limited to the question of whether
to extend the effect of a foreign judgment in the Philippines. In a foreign judgment relating to the status of a marriage involving a citizen of a foreign country, Philippine courts only
decide whether to extend its effect to the Filipino party, under the rule of lex nationalii expressed in Article 15 of the Civil Code.

For this purpose, Philippine courts will only determine (1) whether the foreign judgment is inconsistent with an overriding public policy in the Philippines; and (2) whether any alleging
party is able to prove an extrinsic ground to repel the foreign judgment, i.e. want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact. If there is
neither inconsistency with public policy nor adequate proof to repel the judgment, Philippine courts should, by default, recognize the foreign judgment as part of the comity of nations.
Section 48(b), Rule 39 of the Rules of Court states that the foreign judgment is already "presumptive evidence of a right between the parties." Upon recognition of the foreign judgment,
this right becomes conclusive and the judgment serves as the basis for the correction or cancellation of entry in the civil registry. The recognition of the foreign judgment nullifying a
bigamous marriage is a subsequent event that establishes a new status, right and fact92 that needs to be reflected in the civil registry. Otherwise, there will be an inconsistency
between the recognition of the effectivity of the foreign judgment and the public records in the Philippines.1wphi1

However, the recognition of a foreign judgment nullifying a bigamous marriage is without prejudice to prosecution for bigamy under Article 349 of the Revised Penal Code.93 The
recognition of a foreign judgment nullifying a bigamous marriage is not a ground for extinction of criminal liability under Articles 89 and 94 of the Revised Penal Code. Moreover, under
Article 91 of the Revised Penal Code, "[t]he term of prescription [of the crime of bigamy] shall not run when the offender is absent from the Philippine archipelago."

Since A.M. No. 02-11-10-SC is inapplicable, the Court no longer sees the need to address the questions on venue and the contents and form of the petition under Sections 4 and 5,
respectively, of A.M. No. 02-11-10-SC.

WHEREFORE, we GRANT the petition. The Order dated 31 January 2011 and the Resolution dated 2 March 2011 of the Regional Trial Court, Branch 107, Quezon City, in Civil Case
No. Q-11-68582 are REVERSED and SET ASIDE. The Regional Trial Court is ORDERED to REINSTATE the petition for further proceedings in accordance with this Decision.

SO ORDERED.

7. G.R. No. 187587

June 5, 2013

NAGKAKAISANG MARALITA NG SITIO MASIGASIG, INC., Petitioner,

vs.
MILITARY SHRINE SERVICES - PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL DEFENSE, Respondent.

x-----------------------x

G.R. No. 187654

WESTERN BICUTAN LOT OWNERS ASSOCIATION, INC., represented by its Board of Directors, Petitioner,
vs.
MILITARY SHRINE SERVICES - PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL DEFENSE, Respondent.

DECISION

SERENO, CJ.:

Before us are consolidated Petitions for Review under Rule 45 of the Rules of Court assailing the Decision1promulgated on 29 April 2009 of the Court of Appeals in CA-G.R. SP No.
97925.

THE FACTS

The facts, as culled from the records, are as follows:

On 12 July 1957, by virtue of Proclamation No. 423, President Carlos P. Garcia reserved parcels of land in the Municipalities of Pasig, Taguig, Paraaque, Province of Rizal and Pasay
City for a military reservation. The military reservation, then known as Fort William McKinley, was later on renamed Fort Andres Bonifacio (Fort Bonifacio).

On 28 May 1967, President Ferdinand E. Marcos (President Marcos) issued Proclamation No. 208, amending Proclamation No. 423, which excluded a certain area of Fort Bonifacio
and reserved it for a national shrine. The excluded area is now known as Libingan ng mga Bayani, which is under the administration of herein respondent Military Shrine Services
Philippine Veterans Affairs Office (MSS-PVAO).

Again, on 7 January 1986, President Marcos issued Proclamation No. 2476, further amending Proclamation No. 423, which excluded barangaysLower Bicutan, Upper Bicutan and
Signal Village from the operation of Proclamation No. 423 and declared it open for disposition under the provisions of Republic Act Nos. (R.A.) 274 and 730.

At the bottom of Proclamation No. 2476, President Marcos made a handwritten addendum, which reads:

"P.S. This includes Western Bicutan

(SGD.) Ferdinand E. Marcos"2

The crux of the controversy started when Proclamation No. 2476 was published in the Official Gazette3 on 3 February 1986, without the above-quoted addendum.

Years later, on 16 October 1987, President Corazon C. Aquino (President Aquino) issued Proclamation No. 172 which substantially reiterated Proclamation No. 2476, as published, but
this time excluded Lots 1 and 2 of Western Bicutan from the operation of Proclamation No. 423 and declared the said lots open for disposition under the provisions of R.A. 274 and 730.

Memorandum Order No. 119, implementing Proclamation No. 172, was issued on the same day.

Through the years, informal settlers increased and occupied some areas of Fort Bonifacio including portions of the Libingan ng mga Bayani. Thus, Brigadier General Fredelito Bautista
issued General Order No. 1323 creating Task Force Bantay (TFB), primarily to prevent further unauthorized occupation and to cause the demolition of illegal structures at Fort
Bonifacio.

On 27 August 1999, members of petitioner Nagkakaisang Maralita ng Sitio Masigasig, Inc. (NMSMI) filed a Petition with the Commission on Settlement of Land Problems (COSLAP),
where it was docketed as COSLAP Case No. 99-434. The Petition prayed for the following: (1) the reclassification of the areas they occupied, covering Lot 3 of SWO-13-000-298 of
Western Bicutan, from public land to alienable and disposable land pursuant to Proclamation No. 2476; (2) the subdivision of the subject lot by the Director of Lands; and (3) the Land
Management Bureaus facilitation of the distribution and sale of the subject lot to its bona fide occupants.4

On 1 September 2000, petitioner Western Bicutan Lot Owners Association, Inc. (WBLOAI) filed a Petition-in-Intervention substantially praying for the same reliefs as those prayed for by
NMSMI with regard to the area the former then occupied covering Lot 7 of SWO-00-001302 in Western Bicutan.5

Thus, on 1 September 2006, COSLAP issued a Resolution6 granting the Petition and declaring the portions of land in question alienable and disposable, with Associate Commissioner
Lina Aguilar-General dissenting.7

The COSLAP ruled that the handwritten addendum of President Marcos was an integral part of Proclamation No. 2476, and was therefore, controlling. The intention of the President
could not be defeated by the negligence or inadvertence of others. Further, considering that Proclamation

No. 2476 was done while the former President was exercising legislative powers, it could not be amended, repealed or superseded, by a mere executive enactment. Thus, Proclamation
No. 172 could not have superseded much less displaced Proclamation No. 2476, as the latter was issued on October 16, 1987 when President Aquinos legislative power had ceased.

In her Dissenting Opinion, Associate Commissioner Lina AguilarGeneral stressed that pursuant to Article 2 of the Civil Code, publication is indispensable in every case. Likewise, she
held that when the provision of the law is clear and unambiguous so that there is no occasion for the court to look into legislative intent, the law must be taken as it is, devoid of judicial
addition or subtraction.8 Finally, she maintained that the Commission had no authority to supply the addendum originally omitted in the published version of Proclamation No. 2476, as
to do so would be tantamount to encroaching on the field of the legislature.

Herein respondent MSS-PVAO filed a Motion for Reconsideration,9 which was denied by the COSLAP in a Resolution dated 24 January 2007.10

MSS-PVAO filed a Petition with the Court of Appeals seeking to reverse the COSLAP Resolutions dated 1 September 2006 and 24 January 2007.

Thus, on 29 April 2009, the then Court of Appeals First Division rendered the assailed Decision granting MSS-PVAOs Petition, the dispositive portion of which reads:

IN VIEW OF ALL THE FOREGOING, the instant petition is hereby GRANTED. The Resolutions dated September 1, 2006 and January 24, 2007 issued by the Commission on the
Settlement of Land Problems in COSLAP Case No. 99-434 are hereby REVERSED and SET ASIDE. In lieu thereof, the petitions of respondents in COSLAP Case No. 99-434 are
DISMISSED, for lack of merit, as discussed herein. Further, pending urgent motions filed by respondents are likewise

DENIED. SO ORDERED.11 (Emphasis in the original)

Both NMSMI12 and WBLOAI13 appealed the said Decision by filing their respective Petitions for Review with this Court under Rule 45 of the Rules of Court.

THE ISSUES

Petitioner NMSMI raises the following issues:

WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT PROCLAMATION NO. 2476 DID NOT INCLUDE ANY PORTION OF
WESTERN BICUTAN AS THE HANDWRITTEN NOTATION BY PRESIDENT MARCOS ON THE SAID PROCLAMATION WAS NOT PUBLISHED IN THE OFFICIAL GAZETTE.

II

WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT PROCLAMATION NO. 172 LIKEWISE EXCLUDED THE PORTION OF LAND
OCCUPIED BY MEMBER OF HEREIN PETITIONER.

III

WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN NOT CONSIDERING THAT THE HON. COSLAP HAS BROAD POWERS TO RECOMMEND TO THE
PRESIDENT >INNOVATIVE MEASURES TO RESOLVE EXPEDITIOUSLY VARIOUS LAND CASES.14

On the other hand, petitioner WBLOAI raises this sole issue:

WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE SUBJECT PROPERTY WAS NOT DECLARED ALIENABLE AND DISPOSABLE BY
VIRTUE OF PROCLAMATION NO. 2476 BECAUSE THE HANDWRITTEN ADDENDUM OF PRESIDENT FERDINAND E. MARCOS INCLUDING WESTERN BICUTAN IN
PROCLAMATION NO. 2476 WAS NOT INCLUDED IN THE PUBLICATION.15

Both Petitions boil down to the principal issue of whether the Court of Appeals erred in ruling that the subject lots were not alienable and disposable by virtue of Proclamation No. 2476
on the ground that the handwritten addendum of President Marcos was not included in the publication of the said law.

THE COURTS RULING

We deny the Petitions for lack of merit.

Considering that petitioners were occupying Lots 3 and 7 of Western Bicutan (subject lots), their claims were anchored on the handwritten addendum of President Marcos to
Proclamation No. 2476. They allege that the former President intended to include all Western Bicutan in the reclassification of portions of Fort Bonifacio as disposable public land when
he made a notation just below the printed version of Proclamation No. 2476.

However, it is undisputed that the handwritten addendum was not included when Proclamation No. 2476 was published in the Official Gazette.

The resolution of whether the subject lots were declared as reclassified and disposable lies in the determination of whether the handwritten addendum of President Marcos has the
force and effect of law. In relation thereto, Article 2 of the Civil Code expressly provides:

ART. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise provided. This Code shall take effect one year
after such publication.

Under the above provision, the requirement of publication is indispensable to give effect to the law, unless the law itself has otherwise provided. The phrase "unless otherwise provided"
refers to a different effectivity date other than after fifteen days following the completion of the laws publication in the Official Gazette, but does not imply that the requirement of
publication may be dispensed with. The issue of the requirement of publication was already settled in the landmark case Taada v. Hon. Tuvera,16 in which we had the occasion to rule
thus:

Publication is indispensable in every case, but the legislature may in its discretion provide that the usual fifteen-day period shall be shortened or extended. An example, as pointed out
by the present Chief Justice in his separate concurrence in the original decision, is the Civil Code which did not become effective after fifteen days from its publication in the Official
Gazette but "one year after such publication." The general rule did not apply because it was "otherwise provided."

It is not correct to say that under the disputed clause publication may be dispensed with altogether. The reason is that such omission would offend due process insofar as it would deny
the public knowledge of the laws that are supposed to govern it. Surely, if the legislature could validly provide that a law shall become effective immediately upon its approval
notwithstanding the lack of publication (or after an unreasonably short period after publication), it is not unlikely that persons not aware of it would be prejudiced as a result; and they
would be so not because of a failure to comply with it but simply because they did not know of its existence. Significantly, this is not true only of penal laws as is commonly supposed.
One can think of many non-penal measures, like a law on prescription, which must also be communicated to the persons they may affect before they can begin to operate.

xxxx

The term "laws" should refer to all laws and not only to those of general application, for strictly speaking all laws relate to the people in general albeit there are some that do not apply to
them directly. An example is a law granting citizenship to a particular individual, like a relative of President Marcos who was decreed instant naturalization. It surely cannot be said that
such a law does not affect the public although it unquestionably does not apply directly to all the people. The subject of such law is a matter of public interest which any member of the
body politic may question in the political forums or, if he is a proper party, even in the courts of justice. In fact, a law without any bearing on the public would be invalid as an intrusion of
privacy or as class legislation or as an ultra vires act of the legislature. To be valid, the law must invariably affect the public interest even if it might be directly applicable only to one
individual, or some of the people only, and not to the public as a whole.

We hold therefore that all statutes, including those of local application and private laws, shall be published as a condition for their effectivity, which shall begin fifteen days after
publication unless a different effectivity date is fixed by the legislature.

Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative powers whenever the same are validly delegated by the
legislature or, at present, directly conferred by the Constitution. Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law
pursuant also to a valid delegation.

xxxx

Accordingly, even the charter of a city must be published notwithstanding that it applies to only a portion of the national territory and directly affects only the inhabitants of that place. All
presidential decrees must be published, including even, say, those naming a public place after a favored individual or exempting him from certain prohibitions or requirements. The
circulars issued by the Monetary Board must be published if they are meant not merely to interpret but to "fill in the details" of the Central Bank Act which that body is supposed to
enforce.

xxxx

We agree that the publication must be in full or it is no publication at all since its purpose is to inform the public of the contents of the laws. As correctly pointed out by the petitioners, the
mere mention of the number of the presidential decree, the title of such decree, its whereabouts (e.g., "with Secretary Tuvera"), the supposed date of effectivity, and in a mere
supplement of the Official Gazette cannot satisfy the publication requirement.1wphi1 This is not even substantial compliance. This was the manner, incidentally, in which the General
Appropriations Act for FY 1975, a presidential decree undeniably of general applicability and interest, was "published" by the Marcos administration. The evident purpose was to
withhold rather than disclose information on this vital law.

xxxx

Laws must come out in the open in the clear light of the sun instead of skulking in the shadows with their dark, deep secrets. Mysterious pronouncements and rumored rules cannot be
recognized as binding unless their existence and contents are confirmed by a valid publication intended to make full disclosure and give proper notice to the people. The furtive law is
like a scabbarded saber that cannot feint, parry or cut unless the naked blade is drawn. (Emphases supplied)

Applying the foregoing ruling to the instant case, this Court cannot rely on a handwritten note that was not part of Proclamation No. 2476 as published. Without publication, the note
never had any legal force and effect.

Furthermore, under Section 24, Chapter 6, Book I of the Administrative Code, "the publication of any law, resolution or other official documents in the Official Gazette shall be prima
facie evidence of its authority." Thus, whether or not President Marcos intended to include Western Bicutan is not only irrelevant but speculative. Simply put, the courts may not
speculate as to the probable intent of the legislature apart from the words appearing in the law.17 This Court cannot rule that a word appears in the law when, evidently, there is none.
In Pagpalain Haulers, Inc. v. Hon. Trajano,18 we ruled that "under Article 8 of the Civil Code, 'judicial decisions applying or interpreting the laws or the Constitution shall form a part of
the legal system of the Philippines.' This does not mean, however, that courts can create law. The courts exist for interpreting the law, not for enacting it. To allow otherwise would be
violative of the principle of separation of powers, inasmuch as the sole function of our courts is to apply or interpret the laws, particularly where gaps or lacunae exist or where
ambiguities becloud issues, but it will not arrogate unto itself the task of legislating." The remedy sought in these Petitions is not judicial interpretation, but another legislation that would
amend the law to include petitioners' lots in the reclassification.

WHEREFORE, in view of the foregoing, the instant petitions are hereby DENIED for lack of merit. The assailed Decision of the Court of Appeals in CA-G.R. CV No. 97925 dated 29
April 2009 is AFFIRMED in toto. Accordingly, this Court's status quo order dated 17 June 2009 is hereby LIFTED. Likewise, all pending motions to cite respondent in contempt is
DENIED, having been rendered moot. No costs.

SO ORDERED.

8. G.R. No. 179492

June 5, 2013

REPUBLIC OF THE PHILIPPINES, represented by ABUSAMA M. ALID, Officer-in-Charge, DEPARTMENT OF AGRICULTURE - REGIONAL FIELD UNIT XII (DA-RFU
XII), Petitioner,
vs.
ABDULWAHAB A. BAYAO, OSMEA I. MONTAER, RAKMA B. BUISAN, HELEN M. ALVAREZ, NEILA P. LIMBA, ELIZABETH B. PUSTA, ANNA MAE A. SIDENO, UDTOG B.
TABONG, JOHN S. KAMENZA, DELIA R. SUBALDO, DAYANG W. MACMOD, FLORENCE S. TAYUAN, in their own behalf and in behalf of the other officials and employees
of DA-RFU XII, Respondents.

DECISION

LEONEN, J.:

Before us is a Petition for Review on Certiorari filed under Rule 45. This Petition prays for the reversal and setting aside of the Court of Appeals (1) Resolution dated March 21, 2007
that dismissed the Petition for Certiorari under Rule 65 filed by petitioner for failure to resort to a Motion for Reconsideration of the assailed trial court Order dated October 9, 2006 and
(2) Resolution dated August 16, 2007 denying petitioners Motion for Reconsideration.

Petitioner Department of AgricultureRegional Field Unit XII (DARFU XII) is a government office mandated to implement the laws, policies, plans, programs, rules, and regulations of
the Department of Agriculture in its regional area, while respondents are officials and employees of DA-RFU XII.1

On March 30, 2004, Executive Order (E.O.) No. 304 was passed designating Koronadal City as the regional center and seat of SOCCSKSARGEN Region.2 It provides that all
departments, bureaus, and offices of the national government in the SOCCSKSARGEN Region shall transfer their regional seat of operations to Koronadal City.3

In an April 1, 2005 Memorandum, the Department of Agriculture (DA) Undersecretary for Operations Edmund J. Sana directed Officer-inCharge (OIC) and Regional Executive Director
of DA-RFU XII Abusama M. Alid as follows:

In compliance with Executive Order No. 304 of which Section 2 states "Transfer of Regional Offices. All departments, bureaus and offices of the National Government on the
SOCCSKSARGEN Region shall transfer their regional seat of operations to Koronadal City," you are hereby directed to immediately effect the transfer of the administrative, finance and
operations base of RFU XII from Cotabato City to Koronadal City. On the interim, part of the staff can temporarily hold office at either or both the ATI building in Tantangan and Tupi
Seed Farm, but the main office shall be within Koronadal City.

The action plan for transfer should be submitted to my office not later than 6 April 2005 so that appropriate funding can be processed soonest. Further, execution of the plan should
commence by 16 April 2005 or earlier so that concerned personnel can benefit from the summer break to make personal arrangements for the transfer of their work base.

For strict compliance.4

In a Memorandum dated April 22, 2005 addressed to DA Secretary Arthur Yap, private respondents opposed the implementation of the April 1, 2005 Memorandum.5

They alleged that in 2004, former President Gloria Macapagal-Arroyo made a pronouncement during one of her visits in Cotabato City that the regional seat of Region 12 shall remain in
Cotabato City.6 Only three departments were not covered by the suspension of E.O. No. 304, namely, the Department of Trade and Industry (DTI), Department of Tourism (DOT), and
Department of Labor and Employment (DOLE).7

Respondents alleged further in their Memorandum to the DA Secretary that on March 7, 2005, they appealed to the Secretary of Agriculture that the implementation of E.O. No. 304 be
held in abeyance. A copy of the Petition was attached to the Memorandum. It cited reasons such as the huge costs the physical transfer will entail and the plight of employees who have
already settled and established their homes in Cotabato City.8

On March 8, 2005, their Petition was endorsed by Department of Agriculture Employees Association-12 (DAEAS-12) President Osmea I. Motaer to then President Macapagal-Arroyo,
and on April 12, 2005, this was referred to DA Secretary Yap for his information and appropriate action.9 Respondents justified their appeal saying that a building was constructed in
Cotabato City that can accommodate the whole staff of DARFU XII. On the other hand, there is no building yet in Koronadal City where rent is very expensive.10 Moreover, if the

regional office remains in Cotabato City, the government need not spend over 7,200,000.00 as dislocation pay as well as other expenses for equipment hauling and
construction.11 Finally, respondents alleged that the proposed third floor of the ATI Building in Tantangan has a sub-standard foundation and will not be issued a certificate of
occupancy by the City Engineering Office of Koronadal City as per information from an auditor.12

On May 17, 2005, OIC Abusama M. Alid held a meeting and ordered the transfer of the regional office to ATI Building in Tantangan and Tupi Seed Farm in Tupi, both located in South
Cotabato and Uptown, Koronadal City, to be carried out on May 21, 2005.13

This prompted respondents to file on May 18, 2005 a Complaint for Injunction with Prayer for Issuance of Writ of Preliminary Injunction and/or Temporary Restraining Order with the
Regional Trial Court, Branch 14 of Cotabato City.14

By Order dated October 9, 2006, the trial court granted respondents' Prayer for a Writ of Preliminary Injunction.15

In a petition dated December 17, 2006,16 petitioner went to the Court of Appeals via Rule 65 on the ground that the assailed Order of the trial court is contrary to the pronouncement of
this Court in DENR v. DENR Region 12 Employees.

Through the March 21, 2007 Resolution, the Court of Appeals dismissed the Petition for Certiorari for failure of petitioner to resort to a Motion for Reconsideration of the assailed trial
court Order.17

Hence, the present Petition under Rule 45.

Petitioner argues that (1) this case falls under the exceptions for filing a Motion for Reconsideration prior to filing a Petition under Rule 65; (2) the trial court Order enjoining the transfer
is contrary to DENR v. DENR Region 12 Employees18 that upheld the separation of powers between the executive and judiciary on the wisdom of transfer of regional offices; (3) the
trial court interfered into this wisdom of the executive in the management of its affairs; and (4) the trial court disregarded basic rules on amendment and revocation of administrative
issuances and the propriety of injunction as a remedy.19

In their Comment, respondents counter that a Petition via Rule 45 is not the proper remedy to assail the disputed Resolutions.20 They allege that the assailed Court of Appeals
Resolution dismissing the Petition for Certiorari for failure of the petitioners to file a Motion for Reconsideration is not a "final order or resolution" contemplated by Rule 45.21 It is not an
adjudication on the merits.22 In fact, the Court of Appeals did not even attempt to resolve the propriety of the issuance of the assailed trial court Order.23 In any case, respondents
argue that petitioners failure to file a Motion for Reconsideration is fatal. They contend that this is a condition sine qua non for a Petition under Rule 65, and none of the exceptions are
present in this case.24

Based on both parties contentions, the issues involved in this case may be summarized as follows:

I. Whether a Petition via Rule 45 is the proper remedy to assail the disputed Resolutions

II. Whether the present case falls within the exceptions on the requisite for filing a Motion for Reconsideration prior to filing a Petition for Certiorari under Rule 65

III. Whether petitioner can raise other issues not addressed in the assailed Resolutions

IV. Whether the issuance by the RTC of a preliminary injunction against the transfer of the DA Regional Office to Koronadal City violates the separation of powers
between the executive department and the judiciary as to the wisdom behind the transfer

First, we discuss the procedural issues.

Respondents contend that a Petition via Rule 45 is not the proper remedy to assail the disputed Resolutions.25 They allege that the assailedCourt of Appeals Resolution dismissing the
Petition for Certiorari for failure of the petitioners to file a Motion for Reconsideration is not a "final order or resolution" contemplated by Rule 45.26

On the other hand, petitioner argues that if the assailed Resolutions are not elevated via Rule 45, they would attain finality and consequently, the trial court Order dated October 9, 2006
would become unassailable as well.27

A dismissal by the Court of Appeals of a Petition via Rule 65 for failure to file a Motion for Reconsideration may be assailed via Rule 45.

Unlike a Petition via Rule 45 that is a continuation of the appellate process over the original case, a special civil action for certiorari under Rule 65 is an original or independent
action.28 Consequently, the March 21, 2007 Resolution of the Court of Appeals dismissing the Petition via Rule 65 as well as its August 16, 2007 Resolution denying reconsideration
are the final Resolutions contemplated under Rule 45. As correctly pointed out by petitioner, these Resolutions would attain finality if these are not elevated on appeal via Rule 45. As a
result, the trial court Order dated October 9, 2006 would also become unassailable.291wphi1

Respondents also argue that petitioners failure to file a Motion for Reconsideration of the assailed Regional Trial Court Order dated October 9, 2006 is fatal.30 They contend that the
reasons raised by petitioner do not justify dispensing with the prerequisite of filing a Motion for Reconsideration.31

For its part, petitioner argues that its Petition for Certiorari filed before the Court of Appeals falls under the exceptions to the necessity of filing a Motion for Reconsideration.32 In its
Petition with the Court of Appeals, petitioners explained its reasons for no longer filing a Motion for Reconsideration of the assailed order in that (a) the questions to be raised in the
motion have already been duly raised and passed upon by the lower court33 and (b) there is urgent necessity for the resolution of the questions or issues raised.34 Petitioners allege
that the trial court presiding judge was not acting on the disposition of the case with dispatch and that any further delay would unduly prejudice the interests of the government in
pursuing its economic development strategies in the region.35

The settled rule is that a Motion for Reconsideration is a condition sine qua non for the filing of a Petition for Certiorari.36 Its purpose is to grant an opportunity for the court to correct
any actual or perceived error attributed to it by re-examination of the legal and factual circumstances of the case.37

This rule admits well-defined exceptions as follows:

Concededly, the settled rule is that a motion for reconsideration is a condition sine qua non for the filing of a petition for certiorari.

Its purpose is to grant an opportunity for the court to correct any actual or perceived error attributed to it by the re-examination of the legal and factual circumstances of the case. The
rule is, however, circumscribed by well-defined exceptions, such as (a) where the order is a patent nullity, as where the court a quo has no jurisdiction; (b) where the questions raised in
the certiorari proceedings have been duly raised and passed upon by the lower court, or are the same as those raised and passed upon in the lower court; (c) where there is an urgent
necessity for the resolution of the question and any further delay would prejudice the interests of the Government or of the petitioner or the subject matter of the action is perishable; (d)
where, under the circumstances, a motion for reconsideration would be useless; (e) where petitioner was deprived of due process and there is extreme urgency for relief; (f) where, in a
criminal case, relief from an order of arrest is urgent and the granting of such relief by the trial court is improbable; (g) where the proceedings in the lower court are a nullity for lack of
due process; (h) where the proceeding were ex parte or in which the petitioner had no opportunity to object; and (i) where the issue raised is one purely of law or where public interest is
involved.38 (Emphasis provided)

The second exception is present in this case.

In Siok Ping Tang v. Subic Bay Distribution, Inc.,39 this Court found that the non-filing of a Motion for Reconsideration in the case was not fatal since the questions raised in the
certiorari proceedings have already been duly raised and passed upon by the lower court, viz:

Respondent explained their omission of filing a motion for reconsideration before resorting to a petition for certiorari based on exceptions (b), (c) and (i). The CA brushed aside the filing
of the motion for reconsideration based on the ground that the questions raised in the certiorari proceedings have been duly raised and passed upon by the lower court, or are the same
as those raised and passed upon in the lower court. We agree.

Respondent had filed its position paper in the RTC stating the reasons why the injunction prayed for by petitioner should not be granted. However, the RTC granted the injunction.
Respondent filed a petition for certiorari with the CA and presented the same arguments which were already passed upon by the RTC. The RTC already had the opportunity to consider
and rule on the question of the propriety or impropriety of the issuance of the injunction. We found no reversible error committed by the CA for relaxing the rule since respondent's case
falls within the exceptions.40

Similarly, the various issues raised in the Petition with the Court of Appeals have already been raised by petitioner on several occasions through its pleadings with the trial court. The
lower court, therefore, passed upon them prior to its issuance of its Order dated October 9, 2006. Specifically, the table below summarizes the issues and arguments raised by
petitioner before the trial court vis a vis those raised in the Petition for Certiorari filed with the Court of Appeals:

COURT OF

TRIAL COURT

APPEALS

Motion to Dismiss41

Memorandum42

Manifestation and Reply43

Petition for Certiorari44

dated June 27, 2005

dated September 1, 2006

dated September 5, 2006

dated December 17, 2006

The Honorable Supreme Court

The instant complaint filed by plaintiffs for

To reiterate, the Supreme Court has held in

Respondent judge committed grave abuse of

had already ruled that the propriety

injunction is an indirect way of preventing the

the applicable case of DENR v. DENR Region

discretion to lack or excess of jurisdiction when he

or wisdom of the transfer of

transfer of the regional seat of DARFU XII

12 Employees (409 SCRA 359 [2003]) that

enjoined petitioner from transferring DA-RFU XII

government agencies or offices

which has been upheld by the Supreme Court

respondent DENR employees "cannot, by

from Cotabato City to South Cotabato and

from Cotabato City to Koronadal,

in DENR v. DENR Region 12 Employees (409

means of an injunction, force the DENR XII

Koronadal City. The assailed order of the lower

South Cotabato is beyond judicial

SCRA 359 [2003]). If this Honorable Court

Regional Offices to remain in Cotabato City,

court enjoining petitioner from transferring the seat

inquiry.45

cannot countermand the Supreme Courts

as the exercise of the authority to transfer the

of the DA-RFU XII office to Koronadal City in South

ruling directly, it cannot do so indirectly.46

same is executive in nature." The Supreme

Cotabato is contrary to the pronouncement of the

Court further stated in said case that "the

Supreme Court in DENR v. DENR Region 12

judiciary cannot inquire into the wisdom or

Employees (409 SCRA 359 [2003]).48

expediency of the acts of the executive or the

legislative department."47
Corollary to the above, the Order dated May
31, 2005 of this Honorable Court enjoining
defendants from transferring the seat of the
DA-RFU XII office to Koronadal City in South
Cotabato is contrary to the above
pronouncement of the Supreme Court.
Perforce, the Order must be set aside
accordingly.49
The allegation under Paragraph 4

Executive orders are amended, modified or

Respondent judge acted arbitrarily, whimsically and

of the Complaint that her

revoked by subsequent ones. The alleged

in a very biased manner when he concluded that

Excellency, President Gloria

public pronouncement of the President

the President of the Republic has suspended the

Macapagal-Arroyo only made a

suspending the implementation of Executive

implementation of Executive Order No. 304.52

public pronouncement that the

Order No. 304 is contrary to the ordinance

effect of E.O. No. 304 is

power of the President as provided under the

suspended is hearsay and contrary

Administrative Code of 1987.51

to the procedure on the repeal,

amendment or modification of
rules and regulations.50
By the nature of their appointment

Respondent judge committed grave abuse of

as Regional Officials and

discretion when he concluded that the transfer of

Employees, plaintiffs can be

DA-RFU XII to Koronadal City will affect seriously

reassigned anywhere within

the studies of respondents children and that there

Region XII in the exigency of the

will be no buildings to house respondents.54

service.53
The allegation of possible injury to plaintiffs

If the plight and conditions of the families of

and their families as a consequence of the

the DENR employees are worth considering,

planned transfer of the regional seat of DA-

like the dislocation of schooling of their

RFU XII to Koronadal City had been ruled

children, which without doubt has more

upon by the Supreme Court in DENR v.

adverse impact than the supposed absence of

DENR Region 12 Employees (409 SCRA 359

allowances for the transfer, the Supreme Court

[2003]) to be beyond judicial inquiry because

should have granted the injunction prayed for

it involves concerns that are more on the

by said DENR employees. Apparently, the

propriety or wisdom of the transfer rather than

Supreme Court did not find it compelling to

on its legality.55

grant the injunction over and above the

wisdom of the transfer.56

The families of the employees can still stay in

Cotabato City in as much as they have
established residences in the area. It must be
emphasized that the employees derive
salaries and benefits from their government
work, from which they support their families.
The movement of employees thus would not
cause much financial dislocation as long as
the employees received their salaries and
benefits.57
The Honorable Court must further realize that

Respondent judge committed grave abuse of

the employees are being paid their salaries. In

discretion when he concluded that the transfer of

the given order of things, such salaries are

DA-RFU XII would stretch out the meager salaries

enough to provide for their basic necessities.

of respondents and that it would cause them

The Regional Office can simply provide for

economic strangulation.59

transportation to effectuate the minimum

required for the transfer to Koronadal City and
expect the employees to live on their salaries.
Any allowances due and owing the employees
connected with the transfer can be given to
them later as back payments. This is not to
forget that the Regional Office has provided
temporary housing for said employees to
alleviate any inconvenience that they may
suffer.58
There is absolutely no technical

The issues on the alleged illegal realignment

Respondent judge committed grave abuse of

malversation in the realignment of

of funds, unauthorized ssuance of

discretion when he ordered the issuance of a writ of

budgetary allocation for the

memorandum and the alleged unjust transfer

preliminary injunction based on the absence of

intended transfer of DA-RFU XII to

of employees of DA-RFU XII are acts that are

appropriation for the transfer to Koronadal City in

Koronadal City.60

executive in nature x x x.61

the amount of P9,250,000.00.62

x x x the funds needed for the transfer can be

sourced and met by the DA from sources
such as the discretionary administrative fund
of the Office of the Secretary. Respondents
computation of the amount required for the
transfer in the amount ofP9,222,000.00 is
bloated or exaggerated.63
Respondents who are accountable officers

Respondent judge committed grave abuse of

cannot be coerced to transfer funds that are

discretion when he concluded that respondents

deemed illegal or improper. Hence, no

would suffer irreparable damage if the transfer of

personal liability or irreparable injury would be

DARFU XII from Cotabato City to Koronadal City is

caused upon them. On the other hand, the

not enjoined.65

rest of respondents who are ordinary

employees would not suffer any irreparable
injury.1wphi1 This is due to the fact that they
have no privity to the alleged illegal transfer of
funds.64

Thus, the present case falls under the second exception in that a Motion for Reconsideration need not be filed where questions raised in the certiorari proceedings are the same as
those raised and passed upon in the lower court.

In any case, this Court disregards the presence of procedural flaws when there is necessity to address the issues because of the demands of public interest, including the need for
stability in the public service and the serious implications the case may cause on the effective administration of the executive department.66

The instant Petition involves the effective administration of the executive department and would similarly warrant relaxation of procedural rules if need be. Specifically, the fourth clause
of E.O. No. 304 states as follows: "WHEREAS, the political and socio-economic conditions in SOCCSKSARGEN Region point to the need for designating the regional center and seat
of the region to improve government operations and services."67

Respondents final contention is that the disputed Resolutions issued by the Court of Appeals dwell solely on the indispensability of the filing of a Motion for Reconsideration with the
trial court before filing a Petition via Rule 65; thus, the other grounds in the present Petition need not be addressed.68

Considering that the Petition has overcome the procedural issues as discussed above, we can now proceed to discuss the substantive issues raised by petitioner.

Petitioner argues that the assailed Order of the trial court enjoining it from transferring the seat of the DA-RFU XII Regional Office to Koronadal City is contrary to this Courts
pronouncement in DENR v. DENR Region 12 Employees upholding the separation of powers of the executive department and the judiciary when it comes to the wisdom of transfer of
regional offices.69

This Court has held that while the power to merge administrative regions is not provided for expressly in the Constitution, it is a power which has traditionally been lodged with the
President to facilitate the exercise of the power of general supervision over local governments.70 This power of supervision is found in the Constitution71 as well as in the Local
Government Code of 1991, as follows:

Section 25 National Supervision over Local Government Units

(a) Consistent with the basic policy on local autonomy, the President shall exercise general supervision over local government units to ensure that their acts are within the scope of their
prescribed powers and functions.

The President shall exercise supervisory authority directly over provinces, highly urbanized cities, and independent component cities; through the province with respect to component
cities and municipalities; and through the city and municipality with respect to barangays.72

In Chiongbian v. Orbos, we held further that the power of the President to reorganize administrative regions carries with it the power to determine the regional center.73

The case of DENR v. DENR Region 12 Employees is in point. This Court held that the DENR Secretary can reorganize validly the DENR by ordering the transfer of the DENR XII
Regional Offices from Cotabato City to Koronadal, South Cotabato. We also found as follows:74

It may be true that the transfer of the offices may not be timely considering that: (1) there are no buildings yet to house the regional offices in Koronadal, (2) the transfer falls on the
month of Ramadan, (3) the children of the affected employees are already enrolled in schools in Cotabato City, (4) the Regional Development Council was not consulted, and (5) the
Sangguniang Panglungsod, through a resolution, requested the DENR Secretary to reconsider the orders. However, these concern issues addressed to the wisdom of the transfer
rather than to its legality. It is basic in our form of government that the judiciary cannot inquire into the wisdom or expediency of the acts of the executive or the legislative department,
for each department is supreme and independent of the others, and each is devoid of authority not only to encroach upon the powers or field of action assigned to any of the other
department, but also to inquire into or pass upon the advisability or wisdom of the acts performed, measures taken or decisions made by the other departments.75 (Emphasis provided)

The transfer of the regional center of the SOCCSKSARGEN region to Koronadal City is an executive function.

Similar to DENR v. DENR Region 12 Employees, the issues in the present case are addressed to the wisdom of the transfer rather than to its legality. Some of these concerns are the
lack of a proper and suitable building in Koronadal to house the DA regional office, the inconvenience of the transfer considering that the children of respondent-employees are already
enrolled in Cotabato City schools, and other similar reasons.

The judiciary cannot inquire into the wisdom or expediency of the acts of the executive.76 When the trial court issued its October 9, 2006 Order granting preliminary injunction on the
transfer of the regional center to Koronadal City when such transfer was mandated by E.O. No. 304, the lower court did precisely that.

The principle of separation of powers ordains that each of the three great government branches has exclusive cognizance of and is supreme in concerns falling within its own
constitutionally allocated sphere.77 The judiciary as Justice Laurel emphatically asserted "will neither direct nor restrain executive or legislative action x x x. "78

Finally, a verbal pronouncement to the effect that E.O. No. 304 is suspended should not have been given weight. An executive order is valid when it is not contrary to the law or
Constitution.79

WHEREFORE, the Petition is GRANTED. The Resolutions of the Court of Appeals dated March 21, 2007 and August 16, 2007 in CA-G.R. SP No. 0 1457-MIN, as well as the Decision
dated October 9, 2006 of the Regional Trial Court, Branch 14 of Cotabato City are REVERSED and SET ASIDE.

SO ORDERED.

9. G.R. No. 170022

January 9, 2013

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
CESAR ENCELAN, Respondent.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 filed by petitioner Republic of the Philippines challenging the October 7, 2005 amended decision2 of the Court of Appeals (CA) that
reconsidered its March 22, 2004 decision3(original decision) in CA-G.R. CV No. 75583. In its original decision, the CA set aside the June 5, 2002 decision4 of the Regional Trial Court
(RTC) of Manila, Branch 47, in Civil Case No. 95-74257, which The Factual Antecedents

On August 25, 1979, Cesar married Lolita5 and the union bore two children, Maricar and Manny.6 To support his family, Cesar went to work in Saudi Arabia on May 15, 1984. On June
12, 1986, Cesar, while still in Saudi Arabia, learned that Lolita had been having an illicit affair with Alvin Perez. Sometime in 1991,7 Lolita allegedly left the conjugal home with her
children and lived with Alvin. Since then, Cesar and Lolita had been separated. On June 16, 1995, Cesar filed with the RTC a petition against Lolita for the declaration of the nullity of
his marriage based on Lolitas psychological incapacity.8

Lolita denied that she had an affair with Alvin; she contended that Alvin used to be an associate in her promotions business. She insisted that she is not psychologically incapacitated
and that she left their home because of irreconcilable differences with her mother-in-law.9

At the trial, Cesar affirmed his allegations of Lolitas infidelity and subsequent abandonment of the family home.10He testified that he continued to provide financial support for Lolita and
their children even after he learned of her illicit affair with Alvin.11

Cesar presented the psychological evaluation report12 on Lolita prepared by Dr. Fareda Fatima Flores of the National Center for Mental Health. Dr. Flores found that Lolita was "not
suffering from any form of major psychiatric illness,"13 but had been "unable to provide the expectations expected of her for a good and lasting marital relationship";14 her "transferring
from one job to the other depicts some interpersonal problems with co-workers as well as her impatience in attaining her ambitions";15 and "her refusal to go with her husband abroad
signifies her reluctance to work out a good marital and family relationship."16

The RTC Ruling

In its June 5, 2002 decision,17 the RTC declared Cesars marriage to Lolita void, finding sufficient basis to declare Lolita psychologically incapacitated to comply with the essential
marital obligations.

The petitioner, through the Office of the Solicitor General (OSG), appealed to the CA.

The CA Ruling

The CA originally18 set aside the RTCs verdict, finding that Lolitas abandonment of the conjugal dwelling and infidelity were not serious cases of personality disorder/psychological
illness. Lolita merely refused to comply with her marital obligations which she was capable of doing. The CA significantly observed that infidelity is only a ground for legal separation, not
for the declaration of the nullity of a marriage.

Cesar sought reconsideration19 of the CAs decision and, in due course, attained his objective. The CA set aside its original decision and entered another, which affirmed the RTCs
decision. In its amended decision,20 the CA found two circumstances indicative of Lolitas serious psychological incapacity that resulted in her gross infidelity: (1) Lolitas unwarranted
refusal to perform her marital obligations to Cesar; and (2) Lolitas willful and deliberate act of abandoning the conjugal dwelling.

The OSG then filed the present petition.

The Petition

The OSG argues that Dr. Flores psychological evaluation report did not disclose that Lolita had been suffering from a psychological illness nor did it establish its juridical antecedence,
gravity and incurability; infidelity and abandonment do not constitute psychological incapacity, but are merely grounds for legal separation.

The Case for the Respondent

Cesar submits that Lolitas infidelity and refusal to perform her marital obligations established her grave and incurable psychological incapacity.

The Issue

The case presents to us the legal issue of whether there exists sufficient basis to nullify Cesars marriage to Lolita on the ground of psychological incapacity.

The Courts Ruling

We grant the petition. No sufficient basis exists to annul Cesars marriage to Lolita on the ground of psychological incapacity.

Applicable Law and Jurisprudence

on Psychological Incapacity

Article 36 of the Family Code governs psychological incapacity as a ground for declaration of nullity of marriage. It provides that "a marriage contracted by any party who, at the time of
the celebration, was psychologically incapacitated to comply with the essential marital obligations of marriage, shall likewise be void even if such incapacity becomes manifest only after
its solemnization."

In interpreting this provision, we have repeatedly stressed that psychological incapacity contemplates "downright incapacity or inability to take cognizance of and to assume the basic
marital obligations";21 not merely the refusal, neglect or difficulty, much less ill will, on the part of the errant spouse.22 The plaintiff bears the burden of proving the juridical antecedence
(i.e., the existence at the time of the celebration of marriage), gravity and incurability of the condition of the errant spouse.23

Cesar failed to prove Lolitas

psychological incapacity

In this case, Cesars testimony failed to prove Lolitas alleged psychological incapacity. Cesar testified on the dates when he learned of Lolitas alleged affair and her subsequent
abandonment of their home,24 as well as his continued financial support to her and their children even after he learned of the affair,25 but he merely mentioned in passing Lolitas
alleged affair with Alvin and her abandonment of the conjugal dwelling.

In any event, sexual infidelity and abandonment of the conjugal dwelling, even if true, do not necessarily constitute psychological incapacity; these are simply grounds for legal
separation.26 To constitute psychological incapacity, it must be shown that the unfaithfulness and abandonment are manifestations of a disordered personality that completely
prevented the erring spouse from discharging the essential marital obligations.27 No evidence on record exists to support Cesars allegation that Lolitas infidelity and abandonment
were manifestations of any psychological illness.

Cesar mistakenly relied on Dr. Flores psychological evaluation report on Lolita to prove her alleged psychological incapacity. The psychological evaluation, in fact, established that
Lolita did not suffer from any major psychiatric illness.28 Dr. Flores observation on Lolitas interpersonal problems with co-workers,29 to our mind, does not suffice as a consideration
for the conclusion that she was at the time of her marriage psychologically incapacitated to enter into a marital union with Cesar. Aside from the time element involved, a wifes
psychological fitness as a spouse cannot simply be equated with her professional/work relationship; workplace obligations and responsibilities are poles apart from their marital
counterparts. While both spring from human relationship, their relatedness and relevance to one another should be fully established for them to be compared or to serve as measures of
comparison with one another. To be sure, the evaluation report Dr. Flores prepared and submitted cannot serve this purpose. Dr. Flores further belief that Lolitas refusal to go with
Cesar abroad signified a reluctance to work out a good marital relationship30 is a mere generalization unsupported by facts and is, in fact, a rash conclusion that this Court cannot
support.

In sum, we find that Cesar failed to prove the existence of Lolitas psychological incapacity; thus, the CA committed a reversible error when it reconsidered its original decision.1wphi1

Once again, we stress that marriage is an inviolable social institution31 protected by the State. Any doubt should be resolved in favor of its existence its existence and continuation and
against its dissolution and nullity.32 It cannot be dissolved at the whim of the parties nor by transgressions made by one party to the other during the marriage.

WHEREFORE, we GRANT the petition and SET ASIDE the October 7, 2005 amended decision of the Court of Appeals in CA-G.R. CV No. 75583. Accordingly, we DISMISS
respondent Cesar Encelan's petition for declaration of nullity of his marriage to Lolita Castillo-Encelan.

Costs against the respondent.

SO ORDERED.

10. G.R. No. 171557

February 12, 2014

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
RODOLFO O. DE GRACIA, Respondent.

DECISION

PERLAS-BERNABE, J.:

Assailed in this petition for review on certiorari1 are the Decision2 dated June 2, 2005 and Resolution3 dated February 3, 2006 of the Court of Appeals (CA) in CA-G.R. CV No. 69103
which affirmed the Decision4 dated October 17, 2000 of the Regional Trial Court of Zamboanga del Norte, Branch 11 (RTC) in Civil Case No. S-665 declaring the marriage of
respondent Rodolfo O. De Gracia (Rodolfo) and Natividad N. Rosalem (Natividad) void on the ground of psychological incapacity pursuant to Article 36 of the Family Code of the
Philippines5 (Family Code).

The Facts

Rodolfo and Natividad were married on February 15, 1969 at the Parish of St. Vincent Ferrer in Salug, Zamboanga del Norte.6 They lived in Dapaon, Sindangan, Zamboanga del Norte
and have two (2) children, namely, Ma. Reynilda R. De Gracia (Ma. Reynilda) and Ma. Rizza R. De Gracia (Ma. Rizza), who were born on August 20, 1969 and January 15, 1972,
respectively.7

On December 28, 1998, Rodolfo filed a verified complaint for declaration of nullity of marriage (complaint) before the RTC, docketed as Civil Case No. S-665, alleging that Natividad
was psychologically incapacitated to comply with her essential marital obligations. In compliance with the Order8 dated January 5, 1999 of the RTC, the public prosecutor conducted an
investigation to determine if collusion exists between Rodolfo and Natividad and found that there was none.9 Trial on the merits then ensued.

In support of his complaint, Rodolfo testified, among others, that he first met Natividad when they were students at the Barangay High School of Sindangan,10 and he was forced to
marry her barely three (3) months into their courtship in light of her accidental pregnancy.11 At the time of their marriage, he was 21 years old, while Natividad was 18 years of age. He
had no stable job and merely worked in the gambling cockpits as "kristo" and "bangkero sa hantak." When he decided to join and train with the army,12 Natividad left their conjugal
home and sold their house without his consent.13 Thereafter, Natividad moved to Dipolog City where she lived with a certain Engineer Terez (Terez), and bore him a child named Julie
Ann Terez.14 After cohabiting with Terez, Natividad contracted a second marriage on January 11, 1991 with another man named Antonio Mondarez and has lived since then with the
latter in Cagayan de Oro City.15 From the time Natividad abandoned them in 1972, Rodolfo was left to take care of Ma. Reynilda and Ma. Rizza16 and he exerted earnest efforts to
save their marriage which, however, proved futile because of Natividads psychological incapacity that appeared to be incurable.17

For her part, Natividad failed to file her answer, as well as appear during trial, despite service of summons.18Nonetheless, she informed the court that she submitted herself for
psychiatric examination to Dr. Cheryl T. Zalsos (Dr. Zalsos) in response to Rodolfos claims.19 Rodolfo also underwent the same examination.20

In her two-page psychiatric evaluation report,21 Dr. Zalsos stated that both Rodolfo and Natividad were psychologically incapacitated to comply with the essential marital obligations,
finding that both parties suffered from "utter emotional immaturity [which] is unusual and unacceptable behavior considered [as] deviant from persons who abide by established norms of
conduct."22 As for Natividad, Dr. Zalsos also observed that she lacked the willful cooperation of being a wife and a mother to her two daughters. Similarly, Rodolfo failed to perform his
obligations as a husband, adding too that he sired a son with another woman. Further, Dr. Zalsos noted that the mental condition of both parties already existed at the time of the
celebration of marriage, although it only manifested after. Based on the foregoing, Dr. Zalsos concluded that the "couples union was bereft of the mind, will and heart for the obligations
of marriage."23

On February 10, 1999, the Office of the Solicitor General (OSG), representing petitioner Republic of the Philippines (Republic), filed an opposition24 to the complaint, contending that
the acts committed by Natividad did not demonstrate psychological incapacity as contemplated by law, but are mere grounds for legal separation under the Family Code.25

The RTC Ruling

In a Decision26 dated October 17, 2000, the RTC declared the marriage between Rodolfo and Natividad void on the ground of psychological incapacity. It relied on the findings and
testimony of Dr. Zalsos, holding that Natividads emotional immaturity exhibited a behavioral pattern which in psychiatry constitutes a form of personality disorder that existed at the time
of the parties marriage but manifested only thereafter. It likewise concurred with Dr. Zalsoss observation that Natividads condition is incurable since it is deeply rooted within the makeup of her personality. Accordingly, it concluded that Natividad could not have known, much more comprehend the marital obligations she was assuming, or, knowing them, could not
have given a valid assumption thereof.27

The Republic appealed to the CA, averring that there was no showing that Natividads personality traits constituted psychological incapacity as envisaged under Article 36 of the Family
Code, and that the testimony of the expert witness was not conclusive upon the court.28

The CA Ruling

In a Decision29 dated June 2, 2005, the CA affirmed the ruling of the RTC, finding that while Natividads emotional immaturity, irresponsibility and promiscuity by themselves do not
necessarily equate to psychological incapacity, "their degree or severity, as duly testified to by Dr. Zalsos, has sufficiently established a case of psychological disorder so profound as to
render [Natividad] incapacitated to perform her essential marital obligations."30

The Republic moved for reconsideration which was, however, denied in a Resolution31 dated February 3, 2006, hence, the instant petition.

The Issue Before the Court

The primordial issue in this case is whether or not the CA erred in sustaining the RTCs finding of psychological incapacity.

The Ruling of the Court

The petition is meritorious.

"Psychological incapacity," as a ground to nullify a marriage under Article 3632 of the Family Code, should refer to no less than a mental not merely physical incapacity that causes
a party to be truly incognitive of the basic marital covenants that concomitantly must be assumed and discharged by the parties to the marriage which, as so expressed in Article
6833 of the Family Code, among others,34 include their mutual obligations to live together, observe love, respect and fidelity and render help and support. There is hardly any doubt
that the intendment of the law has been to confine the meaning of "psychological incapacity" to the most serious cases of personality disorders clearly demonstrative of an utter
insensitivity or inability to give meaning and significance to the marriage.35 In Santos v. CA36 (Santos), the Court first declared that psychological incapacity must be characterized by:
(a) gravity (i.e., it must be grave and serious such that the party would be incapable of carrying out the ordinary duties required in a marriage); (b) juridical antecedence (i.e., it must be
rooted in the history of the party antedating the marriage, although the overt manifestations may emerge only after the marriage); and (c) incurability (i.e., it must be incurable, or even if
it were otherwise, the cure would be beyond the means of the party involved).37 The Court laid down more definitive guidelines in the interpretation and application of Article 36 of the
Family Code in Republic of the Phils. v. CA,38 whose salient points are footnoted hereunder.39 These guidelines incorporate the basic requirements that the Court established in
Santos.40

Keeping with these principles, the Court, in Dedel v. CA,41 held that therein respondents emotional immaturity and irresponsibility could not be equated with psychological incapacity as
it was not shown that these acts are manifestations of a disordered personality which make her completely unable to discharge the essential marital obligations of the marital state, not
merely due to her youth, immaturity or sexual promiscuity.42 In the same light, the Court, in the case of Pesca v. Pesca43 (Pesca), ruled against a declaration of nullity, as petitioner
therein "utterly failed, both in her allegations in the complaint and in her evidence, to make out a case of psychological incapacity on the part of respondent, let alone at the time of
solemnization of the contract, so as to warrant a declaration of nullity of the marriage," significantly noting that the "[e]motional immaturity and irresponsibility, invoked by her, cannot be
equated with psychological incapacity." In Pesca, the Court upheld the appellate courts finding that the petitioner therein had not established that her husband "showed signs of mental
incapacity as would cause him to be truly incognitive of the basic marital covenant, as so provided for in Article 68 of the Family Code; that the incapacity is grave, has preceded the
marriage and is incurable; that his incapacity to meet his marital responsibility is because of a psychological, not physical illness; that the root cause of the incapacity has been identified
medically or clinically, and has been proven by an expert; and that the incapacity is permanent and incurable in nature."44

The Court maintains a similar view in this case.1wphi1 Based on the evidence presented, there exists insufficient factual or legal basis to conclude that Natividads emotional
immaturity, irresponsibility, or even sexual promiscuity, can be equated with psychological incapacity.

The RTC, as affirmed by the CA, heavily relied on the psychiatric evaluation report of Dr. Zalsos which does not, however, explain in reasonable detail how Natividads condition could
be characterized as grave, deeply-rooted, and incurable within the parameters of psychological incapacity jurisprudence. Aside from failing to disclose the types of psychological tests
which she administered on Natividad, Dr. Zalsos failed to identify in her report the root cause of Natividad's condition and to show that it existed at the time of the parties' marriage.
Neither was the gravity or seriousness of Natividad's behavior in relation to her failure to perform the essential marital obligations sufficiently described in Dr. Zalsos's report. Further,
the finding contained therein on the incurability of Natividad's condition remains unsupported by any factual or scientific basis and, hence, appears to be drawn out as a bare conclusion
and even self-serving. In the same vein, Dr. Zalsos's testimony during trial, which is essentially a reiteration of her report, also fails to convince the Court of her conclusion that Natividad
was psychologically incapacitated. Verily, although expert opm10ns furnished by psychologists regarding the psychological temperament of parties are usually given considerable
weight by the courts, the existence of psychological incapacity must still be proven by independent evidence.45 After poring over the records, the Court, however, does not find any
such evidence sufficient enough to uphold the court a quo's nullity declaration. To the Court's mind, Natividad's refusal to live with Rodolfo and to assume her duties as wife and mother
as well as her emotional immaturity, irresponsibility and infidelity do not rise to the level of psychological incapacity that would justify the nullification of the parties' marriage. Indeed, to
be declared clinically or medically incurable is one thing; to refuse or be reluctant to perform one's duties is another. To hark back to what has been earlier discussed, psychological
incapacity refers only to the most serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give meaning and significance to the marriage.46 In
the final analysis, the Court does not perceive a disorder of this nature to exist in the present case. Thus, for these reasons, coupled too with the recognition that marriage is an
inviolable social institution and the foundation of the family,47 the instant petition is hereby granted.

WHEREFORE, the petition is GRANTED. The Decision dated June 2, 2005 and Resolution dated February 3, 2006 of the Court of Appeals in CA-G.R. CV No. 69103 are REVERSED
and SET ASIDE. Accordingly, the complaint for declaration of nullity of marriage filed under Article 36 of the Family Code is DISMISSED.

SO ORDERED.

11. G.R. No. 202370

September 23, 2013

JUAN SEVILLA SALAS, JR., Petitioner,

vs.
EDEN VILLENA AGUILA, Respondent.

DECISION

CARPIO, J.:

The Case

This petition for review on certiorari1 assails the 16 March 2012 Decision2 and the 28 June 2012 Resolution3 of the Court of Appeals (CA) in CA-G.R. CV No. 95322. The CA affirmed
the 26 September 2008 Order4 of the Regional Trial Court of Nasugbu, Batangas, Branch 14 (RTC), in Civil Case No. 787.

The Facts

On 7 September 1985, petitioner Juan Sevilla Salas, Jr. (Salas) and respondent Eden Villena Aguila (Aguila) were married. On 7 June 1986, Aguila gave birth to their daughter, Joan
Jiselle. Five months later, Salas left their conjugal dwelling. Since then, he no longer communicated with Aguila or their daughter.

On 7 October 2003, Aguila filed a Petition for Declaration of Nullity of Marriage (petition) citing psychological incapacity under Article 36 of the Family Code. The petition states that they
"have no conjugal properties whatsoever."5 In the Return of Summons dated 13 October 2003, the sheriff narrated that Salas instructed his mother Luisa Salas to receive the copy of
summons and the petition.6

On 7 May 2007, the RTC rendered a Decision7 declaring the nullity of the marriage of Salas and Aguila (RTC Decision). The RTC Decision further provides for the "dissolution of their
conjugal partnership of gains, if any."8

On 10 September 2007, Aguila filed a Manifestation and Motion9 stating that she discovered: (a) two 200-square-meter parcels of land with improvements located in San Bartolome,
Quezon City, covered by Transfer Certificate of Title (TCT) No. N-259299-A and TCT No. N-255497; and (b) a 108-square-meter parcel of land with improvement located in Tondo,
Manila, covered by TCT No. 243373 (collectively, "Discovered Properties"). The registered owner of the Discovered Properties is "Juan S.Salas, married to Rubina C. Salas." The
manifestation was set for hearing on 21 September 2007. However, Salas notice of hearing was returned unserved with the remark, "RTS Refused To Receive."

On 19 September 2007, Salas filed a Manifestation with Entry of Appearance10 requesting for an Entry of Judgment of the RTC Decision since no motion for reconsideration or appeal
was filed and no conjugal property was involved.

On 21 September 2007, the hearing for Aguilas manifestation ensued, with Aguila, her counsel and the state prosecutor present. During the hearing, Aguila testified that on 17 April
2007 someone informed her of the existence of the Discovered Properties. Thereafter, she verified the information and secured copies of TCTs of the Discovered Properties. When
asked to clarify, Aguila testified that Rubina C. Salas (Rubina) is Salas common-law wife.11

On 8 February 2008, Salas filed an Opposition to the Manifestation12 alleging that there is no conjugal property to be partitioned based on Aguilas petition. According to Salas, Aguilas
statement was a judicial admission and was not made through palpable mistake. Salas claimed that Aguila waived her right to the Discovered Properties. Salas likewise enumerated
properties he allegedly waived in favor of Aguila, to wit:(1) parcels of land with improvements located in Sugar Landing Subdivision, Alangilan, Batangas City; No. 176 Brias Street,
Nasugbu, Batangas; P. Samaniego Street, Silangan, Nasugbu, Batangas; and Batangas City, financed by Filinvest; (2) cash amounting toP200,000.00; and (3) motor vehicles,
specifically Honda City and Toyota Tamaraw FX(collectively, "Waived Properties"). Thus, Salas contended that the conjugal properties were deemed partitioned.

The Ruling of the Regional Trial Court

In its 26 September 2008 Order, the RTC ruled in favor of Aguila. The dispositive portion of the Order reads:

WHEREFORE, foregoing premises being considered, the petitioner and the respondent are hereby directed to partition between themselves by proper instruments of conveyance, the
following properties, without prejudice to the legitime of their legitimate child, Joan Jisselle Aguila Salas:

(1) A parcel of land registered in the name of Juan S. Salas married to Rubina C. Salas located in San Bartolome, Quezon City and covered by TCT No. N-259299-A
marked as Exhibit "A" and its improvements;

(2) A parcel of land registered in the name of Juan S.Salas married to Rubina C. Salas located in San Bartolome, Quezon City and covered by TCT No. N-255497 marked
as Exhibit "B" and its improvements;

(3) A parcel of land registered in the name of Juan S.Salas married to Rubina Cortez Salas located in Tondo and covered by TCT No. 243373-Ind. marked as Exhibit "D"
and its improvements.

Thereafter, the Court shall confirm the partition so agreed upon bythe parties, and such partition, together with the Order of the Court confirming the same, shall be recorded in the
Registry of Deeds of the place in which the property is situated.

SO ORDERED.13

The RTC held that pursuant to the Rules,14 even upon entry of judgment granting the annulment of marriage, the court can proceed with the liquidation, partition and distribution of the
conjugal partnership of gains if it has not been judicially adjudicated upon, as in this case. The RTC found that the Discovered Properties are among the conjugal properties to be
partitioned and distributed between Salas and Aguila. However, the RTC held that Salas failed to prove the existence of the Waived Properties.

On 11 November 2008, Rubina filed a Complaint-in-Intervention, claiming that: (1) she is Rubina Cortez, a widow and unmarried to Salas; (2) the Discovered Properties are her
paraphernal properties; (3) Salas did not contribute money to purchase the Discovered Properties as he had no permanent job in Japan; (4) the RTC did not acquire jurisdiction over her
as she was not a party in the case; and (5) she authorized her brother to purchase the Discovered Properties but because he was not well-versed with legal documentation, he
registered the properties in the name of "Juan S. Salas, married to Rubina C. Salas."

In its 16 December 2009 Order, the RTC denied the Motion for Reconsideration filed by Salas. The RTC found that Salas failed to prove his allegation that Aguila transferred the
Waived Properties to third persons. The RTC emphasized that it cannot go beyond the TCTs, which state that Salas is the registered owner of the Discovered Properties. The RTC
further held that Salas and Rubina were at fault for failing to correct the TCTs, if they were not married as they claimed.

Hence, Salas filed an appeal with the CA.

The Ruling of the Court of Appeals

On 16 March 2012, the CA affirmed the order of the RTC.15 The CA ruled that Aguilas statement in her petition is not a judicial admission. The CA pointed out that the petition was filed
on 7 October 2003, but Aguila found the Discovered Properties only on 17 April 2007 or before the promulgation of the RTC decision. Thus, the CA concluded that Aguila was palpably
mistaken in her petition and it would be unfair to punish her over a matter that she had no knowledge of at the time she made the admission. The CA also ruled that Salas was not
deprived of the opportunity to refute Aguilas allegations in her manifestation, even though he was not present in its hearing. The CA likewise held that Rubina cannot collaterally attack
a certificate of title.

In a Resolution dated 28 June 2012,16 the CA denied the Motion for Reconsideration17 filed by Salas. Hence, this petition.

The Issues

Salas seeks a reversal and raises the following issues for resolution:

1. The Court of Appeals erred in affirming the trial courts decision ordering the partition of the parcels of land covered by TCT Nos. N-259299-A and N-255497 in Quezon
City and as well as the property in Manila covered by TCT No. 243373 between petitioner and respondent.

2. The Court of Appeals erred in affirming the trial courts decision in not allowing Rubina C. Cortez to intervene in this case18

The Ruling of the Court

The petition lacks merit.

Since the original manifestation was an action for partition, this Court cannot order a division of the property, unless it first makes a determination as to the existence of a coownership.19 Thus, the settlement of the issue of ownership is the first stage in this action.20

Basic is the rule that the party making an allegation in a civil case has the burden of proving it by a preponderance of evidence.21 Salas alleged that contrary to Aguilas petition stating
that they had no conjugal property, they actually acquired the Waived Properties during their marriage. However, the RTC found, and the CA affirmed, that Salas failed to prove the
existence and acquisition of the Waived Properties during their marriage:

A perusal of the record shows that the documents submitted by [Salas] as the properties allegedly registered in the name of [Aguila] are merely photocopies and not certified true
copies, hence, this Court cannot admit the same as part of the records of this case. These are the following:

(1) TCT No. T-65876 a parcel of land located at Poblacion, Nasugbu, Batangas, registered in the name of Eden A. Salas, married to Juan Salas Jr. which is cancelled
by TCT No. T-105443 in the name of Joan Jiselle A. Salas, single;

(2) TCT No. T-68066 a parcel of land situated in the Barrio of Landing, Nasugbu, Batangas, registered in the name of Eden A. Salas, married to Juan S. Salas Jr.

Moreover, [Aguila] submitted original copy of Certification issued by Ms. Erlinda A. Dasal, Municipal Assessor of Nasugbu, Batangas, certifying that [Aguila] has no real property (land
and improvement) listed in the Assessment Roll for taxation purposes, as of September 17, 2008.

Such evidence, in the absence of proof to the contrary, has the presumption of regularity. x x x.

Suffice it to say that such real properties are existing and registered in the name of [Aguila], certified true copies thereof should have been the ones submitted to this Court. Moreover,
there is also a presumption that properties registered in the Registry of Deeds are also declared in the Assessment Roll for taxation purposes.22

On the other hand, Aguila proved that the Discovered Properties were acquired by Salas during their marriage.1wphi1Both the RTC and the CA agreed that the Discovered Properties
registered in Salas name were acquired during his marriage with Aguila. The TCTs of the Discovered Properties were entered on 2 July 1999 and 29 September 2003, or during the
validity of Salas and Aguilas marriage. In Villanueva v. Court of Appeals,23 we held that the question of whether the properties were acquired during the marriage is a factual issue.
Factual findings of the RTC, particularly if affirmed by the CA, are binding on us, except under compelling circumstances not present in this case.24

On Salas allegation that he was not accorded due process for failing to attend the hearing of Aguilas manifestation, we find the allegation untenable. The essence of due process is
opportunity to be heard. We hold that Salas was given such opportunity when he filed his opposition to the manifestation, submitted evidence and filed his appeal.

On both Salas and Rubinas contention that Rubina owns the Discovered Properties, we likewise find the contention unmeritorious. The TCTs state that "Juan S. Salas, married to
Rubina C. Salas" is the registered owner of the Discovered Properties. A Torrens title is generally a conclusive evidence of the ownership of the land referred to, because there is a
strong presumption that it is valid and regularly issued.25 The phrase "married to" is merely descriptive of the civil status of the registered owner.26 Furthermore, Salas did not initially
dispute the ownership of the Discovered Properties in his opposition to the manifestation. It was only when Rubina intervened that Salas supported Rubinas statement that she owns
the Discovered Properties.

Considering that Rubina failed to prove her title or her legal interest in the Discovered Properties, she has no right to intervene in this case. The Rules of Court provide that only "a
person who has a legal interest in the matter in litigation, or in the success of either of the parties, or an interest against both, or is so situated as to be adversely affected by a
distribution or other disposition of property in the custody of the court or of an officer thereof may, with leave of court, be allowed to intervene in the action."27

In Dio v. Dio,28 we held that Article 147 of the Family Code applies to the union of parties who are legally capacitated and not barred by any impediment to contract marriage, but
whose marriage is nonetheless declared void under Article 36 of the Family Code, as in this case. Article147 of the Family Code provides:

ART. 147. When a man and a woman who are capacitated to marry each other, live exclusively with each other as husband and wife without the benefit of marriage or under a void
marriage, their wages and salaries shall be owned by them in equal shares and the property acquired by both of them through their work or industry shall be governed by the rules on
co-ownership.

In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to have been obtained by their joint efforts, work or industry, and shall be owned
by them in equal shares. For purposes of this Article, a party who did not participate in the acquisition by the other party of any property shall be deemed to have contributed jointly in
the acquisition thereof if the formers efforts consisted in the care and maintenance of the family and of the household.

Neither party can encumber or dispose by acts inter vivos of his or her share in the property acquired during cohabitation and owned in common, without the consent of the other, until
after the termination of their cohabitation.

When only one of the parties to a void marriage is in good faith, the share of the party in bad faith in the co-ownership shall be forfeited in favor of their common children. In case of
default of or waiver by any or all of the common children or their descendants, each vacant share shall belong to the respective surviving descendants. In the absence of descendants,
such share shall belong to the innocent party. In all cases, the forfeiture shall take place upon termination of the cohabitation. (Emphasis supplied)

Under this property regime, property acquired during the marriage is prima facie presumed to have been obtained through the couples joint efforts and governed by the rules on coownership.29 In the present case, Salas did not rebut this presumption. In a similar case where the ground for nullity of marriage was also psychological incapacity, we held that the
properties acquired during the union of the parties, as found by both the RTC and the CA, would be governed by co-ownership.30 Accordingly, the partition of the Discovered Properties
as ordered by the RTC and the CA should be sustained, but on the basis of co-ownership and not on the regime of conjugal partnership of gains.

WHEREFORE, we DENY the petition. We AFFIRM the Decision dated16 March 2012 and the Resolution dated 28 June 2012 of the Court of Appeals in CA-G.R. CV No. 95322.

SO ORDERED.

12. G.R. No. 201061

July 3, 2013

SALLY GO-BANGAYAN, Petitioner,

vs.
BENJAMIN BANGAYAN, JR., Respondent.

DECISION

CARPIO, J.:

The Case

Before the Court is a petition for review1 assailing the 17 August 2011 Decision2 and the 14 March 2012 Resolution3 of the Court of Appeals in CA-G.R. CV No. 94226.

The Antecedent Facts

On 15 March 2004, Benjamin Bangayan, Jr. (Benjamin) filed a petition for declaration of a non-existent marriage and/or declaration of nullity of marriage before the Regional Trial Court
of Manila, Branch 43 (trial court). The case was docketed as Civil Case No. 04109401. Benjamin alleged that on 10 September 1973, he married Azucena Alegre (Azucena) in
Caloocan City. They had three children, namely, Rizalyn, Emmamylin, and Benjamin III.

In 1979, Benjamin developed a romantic relationship with Sally GoBangayan (Sally) who was a customer in the auto parts and supplies business owned by Benjamins family. In
December 1981, Azucena left for the United States of America. In February 1982, Benjamin and Sally lived together as husband and wife. Sallys father was against the relationship. On
7 March 1982, in order to appease her father, Sally brought Benjamin to an office in Santolan, Pasig City where they signed a purported marriage contract. Sally, knowing Benjamins
marital status, assured him that the marriage contract would not be registered.

Benjamin and Sallys cohabitation produced two children, Bernice and Bentley. During the period of their cohabitation, they acquired the following real properties:

(1) property under Transfer Certificate of Title (TCT) No. 61722 registered in the names of Benjamin and Sally as spouses;

(2) properties under TCT Nos. 61720 and 190860 registered in the name of Benjamin, married to Sally;

(3) properties under Condominium Certificate of Title (CCT) Nos. 8782 and 8783 registered in the name of Sally, married to Benjamin; and

(4) properties under TCT Nos. N-193656 and 253681 registered in the name of Sally as a single individual.

The relationship of Benjamin and Sally ended in 1994 when Sally left for Canada, bringing Bernice and Bentley with her. She then filed criminal actions for bigamy and falsification of
public documents against Benjamin, using their simulated marriage contract as evidence. Benjamin, in turn, filed a petition for declaration of a non-existent marriage and/or declaration
of nullity of marriage before the trial court on the ground that his marriage to Sally was bigamous and that it lacked the formal requisites to a valid marriage. Benjamin also asked the
trial court for the partition of the properties he acquired with Sally in accordance with Article 148 of the Family Code, for his appointment as administrator of the properties during the
pendency of the case, and for the declaration of Bernice and Bentley as illegitimate children. A total of 44 registered properties became the subject of the partition before the trial court.
Aside from the seven properties enumerated by Benjamin in his petition, Sally named 37 properties in her answer.

After Benjamin presented his evidence, Sally filed a demurrer to evidence which the trial court denied. Sally filed a motion for reconsideration which the trial court also denied. Sally filed
a petition for certiorari before the Court of Appeals and asked for the issuance of a temporary restraining order and/or injunction which the Court of Appeals never issued. Sally then
refused to present any evidence before the trial court citing the pendency of her petition before the Court of Appeals. The trial court gave Sally several opportunities to present her
evidence on 28 February 2008, 10 July 2008, 4 September 2008, 11 September 2008, 2 October 2008, 23 October 2008, and 28 November 2008. Despite repeated warnings from the
trial court, Sally still refused to present her evidence, prompting the trial court to consider the case submitted for decision.

The Decision of the Trial Court

In a Decision4 dated 26 March 2009, the trial court ruled in favor ofBenjamin. The trial court gave weight to the certification dated 21 July 2004 from the Pasig Local Civil Registrar,
which was confirmed during trial, that only Marriage License Series Nos. 6648100 to 6648150 were issued for the month of February 1982 and the purported Marriage License No. N07568 was not issued to Benjamin and Sally.5 The trial court ruled that the marriage was not recorded with the local civil registrar and the National Statistics Office because it could not
be registered due to Benjamins subsisting marriage with Azucena.

The trial court ruled that the marriage between Benjamin and Sally was not bigamous. The trial court ruled that the second marriage was void not because of the existence of the first
marriage but because of other causes, particularly, the lack of a marriage license. Hence, bigamy was not committed in this case. The trial court did not rule on the issue of the
legitimacy status of Bernice and Bentley because they were not parties to the case. The trial court denied Sallys claim for spousal support because she was not married to Benjamin.
The trial court likewise denied support for Bernice and Bentley who were both of legal age and did not ask for support.

On the issue of partition, the trial court ruled that Sally could not claim the 37 properties she named in her answer as part of her conjugal properties with Benjamin. The trial court ruled
that Sally was not legally married to Benjamin. Further, the 37 properties that Sally was claiming were owned by Benjamins parents who gave the properties to their children, including
Benjamin, as advance inheritance. The 37 titles were in the names of Benjamin and his brothers and the phrase "married to Sally Go" was merely descriptive of Benjamins civil status
in the title. As regards the two lots under TCT Nos. 61720 and 190860, the trial court found that they were bought by Benjamin using his own money and that Sally failed to prove any
actual contribution of money, property or industry in their purchase. The trial court found that Sally was a registered co-owner of the lots covered by TCT Nos. 61722, N-193656, and
253681 as well as the two condominium units under CCT Nos. 8782 and 8783. However, the trial court ruled that the lot under TCT No. 61722 and the two condominium units were
purchased from the earnings of Benjamin alone. The trial court ruled that the properties under TCT Nos. 61722, 61720, and 190860 and CCT Nos. 8782 and 8783 were part of the
conjugal partnership of Benjamin and Azucena, without prejudice to Benjamins right to dispute his conjugal state with Azucena in a separate proceeding.

The trial court further ruled that Sally acted in bad faith because she knew that Benjamin was married to Azucena. Applying Article 148 of the Family Code, the trial court forfeited Sallys
share in the properties covered under TCT Nos. N-193656 and 253681 in favor of Bernice and Bentley while Benjamins share reverted to his conjugal ownership with Azucena.

The dispositive portion of the trial courts decision reads:

ACCORDINGLY, the marriage of BENJAMIN BANGAYAN, JR. and SALLY S. GO on March 7, 1982 at Santolan, Pasig, Metro Manila is hereby declared NULL and VOID AB INITIO. It
is further declared NONEXISTENT.

Respondents claim as co-owner or conjugal owner of the thirtyseven (37) properties under TCT Nos. 17722, 17723, 17724, 17725, 126397, RT-73480, and RT-86821; in Manila, TCT
Nos. 188949, 188950, 188951, 193035, 194620, 194621, 194622, 194623, 194624, 194625, 194626, 194627, 194628, 194629, 194630, 194631, 194632, 194633, 194634, 194635,
194636, 194637, 194638, 194639, 198651, 206209, 206210, 206211, 206213 and 206215 is DISMISSED for lack of merit. The registered owners, namely: Benjamin B. Bangayan, Jr.,
Roberto E. Bangayan, Ricardo B. Bangayan and Rodrigo B. Bangayan are the owners to the exclusion of "Sally Go" Consequently, the Registry of Deeds for Quezon City and Manila
are directed to delete the words "married to Sally Go" from these thirty-seven (37) titles.

Properties under TCT Nos. 61722, 61720 and 190860, CCT Nos. 8782 and 8783 are properties acquired from petitioners money without contribution from respondent, hence, these are
properties of the petitioner and his lawful wife. Consequently, petitioner is appointed the administrator of these five (5) properties. Respondent is ordered to submit an accounting of her
collections of income from these five (5) properties within thirty (30) days from notice hereof. Except for lot under TCT No. 61722, respondent is further directed within thirty (30) days
from notice hereof to turn over and surrender control and possession of these properties including the documents of title to the petitioner.

On the properties under TCT Nos. N-193656 and N-253681, these properties are under co-ownership of the parties shared by them equally. However, the share of respondent is
declared FORFEITED in favor of Bernice Go Bangayan and Bentley Go Bangayan. The share of the petitioner shall belong to his conjugal ownership with Azucena Alegre. The
liquidation, partition and distribution of these two (2) properties shall be further processed pursuant to Section 21 of A.M. No. 02-11-10 of March 15, 2003.

Other properties shall be adjudicated in a later proceeding pursuant to Section 21 of A.M. No. 02-11-10.

Respondents claim of spousal support, children support and counterclaims are DISMISSED for lack of merit. Further, no declaration of the status of the parties children.

No other relief granted.

Furnish copy of this decision to the parties, their counsels, the Trial Prosecutor, the Solicitor General and the Registry of Deeds in Manila, Quezon City and Caloocan.

SO ORDERED.6

Sally filed a Verified and Vigorous Motion for Inhibition with Motion for Reconsideration. In its Order dated 27 August 2009,7 the trial court denied the motion. Sally appealed the trial
courts decision before the Court of Appeals.

The Decision of the Court of Appeals

In its 17 August 2011 Decision, the Court of Appeals partly granted the appeal. The Court of Appeals ruled that the trial court did not err in submitting the case for decision. The Court of
Appeals noted that there were six resettings of the case, all made at the instance of Sally, for the initial reception of evidence, and Sally was duly warned to present her evidence on the
next hearing or the case would be deemed submitted for decision. However, despite the warning, Sally still failed to present her evidence. She insisted on presenting Benjamin who was
not around and was not subpoenaed despite the presence of her other witnesses.

The Court of Appeals rejected Sallys allegation that Benjamin failed to prove his action for declaration of nullity of marriage. The Court of Appeals ruled that Benjamins action was
based on his prior marriage to Azucena and there was no evidence that the marriage was annulled or dissolved before Benjamin contracted the second marriage with Sally. The Court
of Appeals ruled that the trial court committed no error in declaring Benjamins marriage to Sally null and void.

The Court of Appeals ruled that the property relations of Benjamin and Sally was governed by Article 148 of the Family Code. The Court of Appeals ruled that only the properties
acquired by the parties through their actual joint contribution of money, property or industry shall be owned by them in common in proportion to their respective contribution. The Court
of Appeals ruled that the 37 properties being claimed by Sally rightfully belong to Benjamin and his siblings.

As regards the seven properties claimed by both parties, the Court of Appeals ruled that only the properties under TCT Nos. 61720 and 190860 registered in the name of Benjamin
belong to him exclusively because he was able to establish that they were acquired by him solely. The Court of

Appeals found that the properties under TCT Nos. N-193656 and 253681 and under CCT Nos. 8782 and 8783 were exclusive properties of Sally in the absence of proof of Benjamins
actual contribution in their purchase. The Court of Appeals ruled that the property under TCT No. 61722 registered in the names of Benjamin and Sally shall be owned by them in
common, to be shared equally. However, the share of Benjamin shall accrue to the conjugal partnership under his existing marriage with Azucena while Sallys share shall accrue to her
in the absence of a clear and convincing proof of bad faith.

Finally, the Court of Appeals ruled that Sally failed to present clear and convincing evidence that would show bias and prejudice on the part of the trial judge that would justify his
inhibition from the case.

The dispositive portion of the Court of Appeals decision reads:

WHEREFORE, premises considered, the instant appeal is PARTLY GRANTED. The assailed Decision and Order dated March 26, 2009 and August 27, 2009, respectively, of the
Regional Trial Court of Manila, Branch 43, in Civil Case No. 04-109401 are hereby AFFIRMED with modification declaring TCT Nos. 61720 and 190860 to be exclusively owned by the
petitioner-appellee while the properties under TCT Nos. N-193656 and 253681 as well as CCT Nos. 8782 and 8783 shall be solely owned by the respondent-appellant. On the other
hand, TCT No. 61722 shall be owned by them and common and to be shared equally but the share of the petitioner-appellee shall accrue to the conjugal partnership under his first
marriage while the share of respondent-appellant shall accrue to her. The rest of the decision stands.

SO ORDERED.8

Sally moved for the reconsideration of the Court of Appeals decision. In its 14 March 2012 Resolution, the Court of Appeals denied her motion.

Hence, the petition before this Court.

The Issues

Sally raised the following issues before this Court:

(1) Whether the Court of Appeals committed a reversible error in affirming the trial courts ruling that Sally had waived her right to present evidence;

(2) Whether the Court of Appeals committed a reversible error in affirming the trial courts decision declaring the marriage between Benjamin and Sally null and void ab
initio and non-existent; and

(3) Whether the Court of Appeals committed a reversible error in affirming with modification the trial courts decision regarding the property relations of Benjamin and
Sally.

The Ruling of this Court

The petition has no merit.

Waiver of Right to Present Evidence

Sally alleges that the Court of Appeals erred in affirming the trial courts ruling that she waived her right to present her evidence. Sally alleges that in not allowing her to present
evidence that she and Benjamin were married, the trial court abandoned its duty to protect marriage as an inviolable institution.

It is well-settled that a grant of a motion for continuance or postponement is not a matter of right but is addressed to the discretion of the trial court.9 In this case, Sallys presentation of
evidence was scheduled on28 February 2008. Thereafter, there were six resettings of the case: on 10 July 2008, 4 and 11 September 2008, 2 and 28 October 2008, and 28 November
2008. They were all made at Sallys instance. Before the scheduled hearing of 28 November 2008, the trial court warned Sally that in case she still failed to present her evidence, the
case would be submitted for decision. On the date of the scheduled hearing, despite the presence of other available witnesses, Sally insisted on presenting Benjamin who was not even
subpoenaed on that day. Sallys counsel insisted that the trial court could not dictate on the priority of witnesses to be presented, disregarding the trial courts prior warning due to the
numerous resettings of the case. Sally could not complain that she had been deprived of her right to present her evidence because all the postponements were at her instance and she
was warned by the trial court that it would submit the case for decision should she still fail to present her evidence on 28 November 2008.

We agree with the trial court that by her continued refusal to present her evidence, she was deemed to have waived her right to present them. As pointed out by the Court of Appeals,
Sallys continued failure to present her evidence despite the opportunities given by the trial court showed her lack of interest to proceed with the case. Further, it was clear that Sally
was delaying the case because she was waiting for the decision of the Court of Appeals on her petition questioning the trial courts denial of her demurrer to evidence, despite the fact
that the Court of Appeals did not issue any temporary restraining order as Sally prayed for. Sally could not accuse the trial court of failing to protect marriage as an inviolable institution
because the trial court also has the duty to ensure that trial proceeds despite the deliberate delay and refusal to proceed by one of the parties.10

Validity of the Marriage between Benjamin and Sally

Sally alleges that both the trial court and the Court of Appeals recognized her marriage to Benjamin because a marriage could not be nonexistent and, at the same time, null and void
ab initio. Sally further alleges that if she were allowed to present her evidence, she would have proven her marriage to Benjamin. To prove her marriage to Benjamin, Sally asked this
Court to consider that in acquiring real properties, Benjamin listed her as his wife by declaring he was "married to" her; that Benjamin was the informant in their childrens birth
certificates where he stated that he was their father; and that Benjamin introduced her to his family and friends as his wife. In contrast, Sally claims that there was no real property
registered in the names of Benjamin and Azucena. Sally further alleges that Benjamin was not the informant in the birth certificates of his children with Azucena.

First, Benjamins marriage to Azucena on 10 September 1973 was duly established before the trial court, evidenced by a certified true copy of their marriage contract. At the time
Benjamin and Sally entered into a purported marriage on 7 March 1982, the marriage between Benjamin and Azucena was valid and subsisting.

On the purported marriage of Benjamin and Sally, Teresita Oliveros (Oliveros), Registration Officer II of the Local Civil Registrar of Pasig City, testified that there was no valid marriage
license issued to Benjamin and Sally. Oliveros confirmed that only Marriage Licence Nos. 6648100 to 6648150 were issued for the month of February 1982. Marriage License No. N07568 did not match the series issued for the month. Oliveros further testified that the local civil registrar of Pasig City did not issue Marriage License No. N-07568 to Benjamin and
Sally. The certification from the local civil registrar is adequate to prove the non-issuance of a marriage license and absent any suspicious circumstance, the certification enjoys
probative value, being issued by the officer charged under the law to keep a record of all data relative to the issuance of a marriage license.11 Clearly, if indeed Benjamin and Sally
entered into a marriage contract, the marriage was void from the beginning for lack of a marriage license.12

It was also established before the trial court that the purported marriage between Benjamin and Sally was not recorded with the local civil registrar and the National Statistics Office. The
lack of record was certified by Julieta B. Javier, Registration Officer IV of the Office of the Local Civil Registrar of the Municipality of Pasig;13 Teresita R. Ignacio, Chief of the Archives
Division of the Records Management and Archives Office, National Commission for Culture and the Arts;14 and Lourdes J. Hufana, Director III, Civil Registration Department of the
National Statistics Office.15 The documentary and testimonial evidence proved that there was no marriage between Benjamin and Sally. As pointed out by the trial court, the marriage
between Benjamin and Sally "was made only in jest"16 and "a simulated marriage, at the instance of Sally, intended to cover her up from expected social humiliation coming from
relatives, friends and the society especially from her parents seen as Chinese conservatives."17 In short, it was a fictitious marriage.

The fact that Benjamin was the informant in the birth certificates of Bernice and Bentley was not a proof of the marriage between Benjamin and Sally. This Court notes that Benjamin
was the informant in Bernices birth certificate which stated that Benjamin and Sally were married on 8 March 198218 while Sally was the informant in Bentleys birth certificate which
also stated that Benjamin and Sally were married on 8 March 1982.19 Benjamin and Sally were supposedly married on 7 March 1982 which did not match the dates reflected on the
birth certificates.

We see no inconsistency in finding the marriage between Benjamin and Sally null and void ab initio and, at the same time, non-existent. Under Article 35 of the Family Code, a marriage
solemnized without a license, except those covered by Article 34 where no license is necessary, "shall be void from the beginning." In this case, the marriage between Benjamin and
Sally was solemnized without a license. It was duly established that no marriage license was issued to them and that Marriage License No. N-07568 did not match the marriage license
numbers issued by the local civil registrar of Pasig City for the month of February 1982. The case clearly falls under Section 3 of Article 3520 which made their marriage void ab initio.
The marriage between Benjamin and Sally was also non-existent. Applying the general rules on void or inexistent contracts under Article 1409 of the Civil Code, contracts which are
absolutely simulated or fictitious are "inexistent and void from the beginning."21 Thus, the Court of Appeals did not err in sustaining the trial courts ruling that the marriage between
Benjamin and Sally was null and void ab initio and non-existent.

Except for the modification in the distribution of properties, the Court of Appeals affirmed in all aspects the trial courts decision and ruled that "the rest of the decision stands."22 While
the Court of Appeals did notdiscuss bigamous marriages, it can be gleaned from the dispositive portion of the decision declaring that "the rest of the decision stands" that the Court of
Appeals adopted the trial courts discussion that the marriage between Benjamin and Sally is not bigamous.1wphi1 The trial court stated:

On whether or not the parties marriage is bigamous under the concept of Article 349 of the Revised Penal Code, the marriage is not bigamous. It is required that the first or former
marriage shall not be null and void. The marriage of the petitioner to Azucena shall be assumed as the one that is valid, there being no evidence to the contrary and there is no trace of
invalidity or irregularity on the face of their marriage contract. However, if the second marriage was void not because of the existence of the first marriage but for other causes such as
lack of license, the crime of bigamy was not committed. In People v. De Lara [CA, 51 O.G., 4079], it was held that what was committed was contracting marriage against the provisions
of laws not under Article 349 but Article 350 of the Revised Penal Code. Concluding, the marriage of the parties is therefore not bigamous because there was no marriage license. The
daring and repeated stand of respondent that she is legally married to petitioner cannot, in any instance, be sustained. Assuming that her marriage to petitioner has the marriage
license, yet the same would be bigamous, civilly or criminally as it would be invalidated by a prior existing valid marriage of petitioner and Azucena.23

For bigamy to exist, the second or subsequent marriage must have all the essential requisites for validity except for the existence of a prior marriage.24 In this case, there was really no
subsequent marriage. Benjamin and Sally just signed a purported marriage contract without a marriage license. The supposed marriage was not recorded with the local civil registrar
and the National Statistics Office. In short, the marriage between Benjamin and Sally did not exist. They lived together and represented themselves as husband and wife without the
benefit of marriage.

Property Relations Between Benjamin and Sally

The Court of Appeals correctly ruled that the property relations of Benjamin and Sally is governed by Article 148 of the Family Code which states:

Art. 148. In cases of cohabitation not falling under the preceding Article, only the properties acquired by both of the parties through their actual joint contribution of money, property, or
industry shall be owned by them in common in proportion to their respective contributions. In the absence of proof to the contrary, their contributions and corresponding shares are
presumed to be equal. The same rule and presumption shall apply to joint deposits of money and evidences of credit.

If one of the parties is validly married to another, his or her share in the co-ownership shall accrue to the absolute community of conjugal partnership existing in such valid marriage. If
the party who acted in bad faith is not validly married to another, his or her share shall be forfeited in the manner provided in the last paragraph of the preceding Article.

The foregoing rules on forfeiture shall likewise apply even if both parties are in bad faith.

Benjamin and Sally cohabitated without the benefit of marriage. Thus, only the properties acquired by them through their actual joint contribution of money, property, or industry shall be
owned by them in common in proportion to their respective contributions. Thus, both the trial court and the Court of Appeals correctly excluded the 37 properties being claimed by Sally
which were given by Benjamins father to his children as advance inheritance. Sallys Answer to the petition before the trial court even admitted that "Benjamins late father himself
conveyed a number of properties to his children and their respective spouses which included Sally x x x."25

As regards the seven remaining properties, we rule that the decision of the Court of Appeals is more in accord with the evidence on record. Only the property covered by TCT No.
61722 was registered in the names of Benjamin and Sally as spouses.26 The properties under TCT Nos. 61720 and 190860 were in the name of Benjamin27 with the descriptive title
"married to Sally." The property covered by CCT Nos. 8782 and 8783 were registered in the name of Sally28 with the descriptive title "married to Benjamin" while the properties under
TCT Nos. N-193656 and 253681 were registered in the name of Sally as a single individual. We have ruled that the words "married to" preceding the name of a spouse are merely
descriptive of the civil status of the registered owner.29 Such words do not prove co-ownership. Without proof of actual contribution from either or both spouses, there can be no coownership under Article 148 of the Family Code.30

Inhibition of the Trial Judge

Sally questions the refusal of Judge Roy G. Gironella (Judge Gironella) to inhibit himself from hearing the case. She cited the failure of Judge Gironella to accommodate her in
presenting her evidence. She further alleged that Judge Gironella practically labeled her as an opportunist in his decision, showing his partiality against her and in favor of Benjamin.

We have ruled that the issue of voluntary inhibition is primarily a matter of conscience and sound discretion on the part of the judge.31 To justify the call for inhibition, there must be
extrinsic evidence to establish bias, bad faith, malice, or corrupt purpose, in addition to palpable error which may be inferred from the decision or order itself.32 In this case, we have
sufficiently explained that Judge Gironella did not err in submitting the case for decision because of Sallys continued refusal to present her evidence.

We reviewed the decision of the trial court and while Judge Gironella may have used uncomplimentary words in writing the decision, they are not enough to prove his prejudice against
Sally or show that he acted in bad faith in deciding the case that would justify the call for his voluntary inhibition.

WHEREFORE, we AFFIRM the 17 August 2011 Decision and the 14 March 2012 Resolution of the Court of Appeals in CA-G.R. CV No. 94226.

SO ORDERED.

13. G.R. Nos. 175279-80

June 5, 2013

SUSAN LIM-LUA, Petitioner,

vs.
DANILO Y. LUA, Respondent.

DECISION

VILLARAMA, JR., J.:

In this petition for review on certiorari under Rule 45, petitioner seeks to set aside the Decision1 dated April 20, 2006 and Resolution2 dated October 26, 2006 of the Court of Appeals
(CA) dismissing her petition for contempt (CA-G.R. SP No. 01154) and granting respondent's petition for certiorari (CA-G.R. SP No. 01315).

The factual background is as follows:

On September 3, 2003,3 petitioner Susan Lim-Lua filed an action for the declaration of nullity of her marriage with respondent Danilo Y. Lua, docketed as Civil Case No. CEB-29346 of
the Regional Trial Court (RTC) of Cebu City, Branch 14.

In her prayer for support pendente lite for herself and her two children, petitioner sought the amount of P500,000.00 as monthly support, citing respondents huge earnings from salaries
and dividends in several companies and businesses here and abroad.4

After due hearing, Judge Raphael B. Yrastorza, Sr. issued an Order5 dated March 31, 2004 granting support pendente lite, as follows:

From the evidence already adduced by the parties, the amount of Two Hundred Fifty (P250,000.00) Thousand Pesos would be sufficient to take care of the needs of the plaintiff. This
amount excludes the One hundred thirty-five (P135,000.00) Thousand Pesos for medical attendance expenses needed by plaintiff for the operation of both her eyes which is
demandable upon the conduct of such operation. The amounts already extended to the two (2) children, being a commendable act of defendant, should be continued by him
considering the vast financial resources at his disposal.

According to Art. 203 of the Family Code, support is demandable from the time plaintiff needed the said support but is payable only from the date of judicial demand. Since the instant
complaint was filed on 03 September 2003, the amount of Two Hundred Fifty (P250,000.00) Thousand should be paid by defendant to plaintiff retroactively to such date until the
hearing of the support pendente lite. P250,000.00 x 7 corresponding to the seven (7) months that lapsed from September, 2003 to March 2004 would tantamount to a total of One
Million Seven Hundred Fifty (P1,750,000.00) Thousand Pesos. Thereafter, starting the month of April 2004, until otherwise ordered by this Court, defendant is ordered to pay a monthly
support of Two Hundred Fifty Thousand (P250,000.00) Pesos payable within the first five (5) days of each corresponding month pursuant to the third paragraph of Art. 203 of the Family
Code of the Philippines. The monthly support of P250,000.00 is without prejudice to any increase or decrease thereof that this Court may grant plaintiff as the circumstances may
warrant i.e. depending on the proof submitted by the parties during the proceedings for the main action for support.6

Respondent filed a motion for reconsideration,7 asserting that petitioner is not entitled to spousal support considering that she does not maintain for herself a separate dwelling from
their children and respondent has continued to support the family for their sustenance and well-being in accordance with familys social and financial standing. As to the P250,000.00
granted by the trial court as monthly support pendente lite, as well as theP1,750,000.00 retroactive support, respondent found it unconscionable and beyond the intendment of the law
for not having considered the needs of the respondent.

In its May 13, 2004 Order, the trial court stated that the March 31, 2004 Order had become final and executory since respondents motion for reconsideration is treated as a mere scrap
of paper for violation of the threeday notice period under Section 4, Rule 15 of the 1997 Rules of Civil Procedure, as amended, and therefore did not interrupt the running of the period
to appeal. Respondent was given ten (10) days to show cause why he should not be held in contempt of the court for disregarding the March 31, 2004 order granting support pendente
lite.8

His second motion for reconsideration having been denied, respondent filed a petition for certiorari in the CA.

On April 12, 2005, the CA rendered its Decision,9 finding merit in respondents contention that the trial court gravely abused its discretion in granting P250,000.00 monthly support to
petitioner without evidence to prove his actual income. The said court thus decreed:

WHEREFORE, foregoing premises considered, this petition is given due course. The assailed Orders dated March 31, 2004, May 13, 2004, June 4, 2004 and June 18, 2004 of the
Regional Trial Court, Branch 14, Cebu City issued in Civil Case No. CEB No. 29346 entitled "Susan Lim Lua versus Danilo Y. Lua" are hereby nullified and set aside and instead a new
one is entered ordering herein petitioner:

a) to pay private respondent a monthly support pendente lite of P115,000.00 beginning the month of April 2005 and every month thereafter within the first five (5) days
thereof;

b) to pay the private respondent the amount of P115,000.00 a month multiplied by the number of months starting from September 2003 until March 2005 less than the
amount supposedly given by petitioner to the private respondent as her and their two (2) children monthly support; and

c) to pay the costs.

SO ORDERED.10

Neither of the parties appealed this decision of the CA. In a Compliance11 dated June 28, 2005, respondent attached a copy of a check he issued in the amount of P162,651.90
payable to petitioner. Respondent explained that, as decreed in the CA decision, he deducted from the amount of support in arrears (September 3, 2003 to March 2005) ordered by the
CA -- P2,185,000.00 -- plus P460,000.00 (April, May, June and July 2005), totalingP2,645,000.00, the advances given by him to his children and petitioner in the sum of P2,482,348.16
(with attached photocopies of receipts/billings).

In her Comment to Compliance with Motion for Issuance of a Writ of Execution,12 petitioner asserted that none of the expenses deducted by respondent may be chargeable as part of
the monthly support contemplated by the CA in CA-G.R. SP No. 84740.

On September 27, 2005, the trial court issued an Order13 granting petitioners motion for issuance of a writ of execution as it rejected respondents interpretation of the CA decision.
Respondent filed a motion for reconsideration and subsequently also filed a motion for inhibition of Judge Raphael B. Yrastorza, Sr. On November 25, 2005, Judge Yrastorza, Sr.
issued an Order14 denying both motions.

WHEREFORE, in view of the foregoing premises, both motions are DENIED. Since a second motion for reconsideration is prohibited under the Rules, this denial has attained finality;
let, therefore, a writ of execution be issued in favor of plaintiff as against defendant for the accumulated support in arrears pendente lite.

Notify both parties of this Order.

SO ORDERED.15

Since respondent still failed and refused to pay the support in arrears pendente lite, petitioner filed in the CA a Petition for Contempt of Court with Damages, docketed as CA-G.R. SP
No. 01154 ("Susan Lim Lua versus Danilo Y. Lua"). Respondent, on the other hand, filed CA-G.R. SP No. 01315, a Petition for Certiorari under Rule 65 of the Rules of Court ("Danilo Y.
Lua versus Hon. Raphael B. Yrastorza, Sr., in his capacity as Presiding Judge of Regional Trial Court of Cebu, Branch 14, and Susan Lim Lua"). The two cases were consolidated.

By Decision dated April 20, 2006, the CA set aside the assailed orders of the trial court, as follows:

WHEREFORE, judgment is hereby rendered:

a) DISMISSING, for lack of merit, the case of Petition for Contempt of Court with Damages filed by Susan Lim Lua against Danilo Y. Lua with docket no. SP. CA-GR No.
01154;

b) GRANTING Danilo Y. Luas Petition for Certiorari docketed as SP. CA-GR No. 01315. Consequently, the assailed Orders dated 27 September 2005 and 25 November
2005 of the Regional Trial Court, Branch 14, Cebu City issued in Civil Case No. CEB-29346 entitled "Susan Lim Lua versus Danilo Y. Lua, are hereby NULLIFIED and
SET ASIDE, and instead a new one is entered:

i. ORDERING the deduction of the amount of PhP2,482,348.16 plus 946,465.64, or a total of PhP3,428,813.80 from the current total support in arrears of
Danilo Y. Lua to his wife, Susan Lim Lua and their two (2) children;

ii. ORDERING Danilo Y. Lua to resume payment of his monthly support of PhP115,000.00 pesos starting from the time payment of this amount was
deferred by him subject to the deductions aforementioned.

iii. DIRECTING the issuance of a permanent writ of preliminary injunction.

SO ORDERED.16

The appellate court said that the trial court should not have completely disregarded the expenses incurred by respondent consisting of the purchase and maintenance of the two cars,
payment of tuition fees, travel expenses, and the credit card purchases involving groceries, dry goods and books, which certainly inured to the benefit not only of the two children, but
their mother (petitioner) as well. It held that respondents act of deferring the monthly support adjudged in CA-G.R. SP No. 84740 was not contumacious as it was anchored on valid and
justifiable reasons. Respondent said he just wanted the issue of whether to deduct his advances be settled first in view of the different interpretation by the trial court of the appellate
courts decision in CA-G.R. SP No. 84740. It also noted the lack of contribution from the petitioner in the joint obligation of spouses to support their children.

Petitioner filed a motion for reconsideration but it was denied by the CA.

Hence, this petition raising the following errors allegedly committed by the CA:

I.

THE HONORABLE COURT ERRED IN NOT FINDING RESPONDENT GUILTY OF INDIRECT CONTEMPT.

II.

THE HONORABLE COURT ERRED IN ORDERING THE DEDUCTION OF THE AMOUNT OF PHP2,482,348.16 PLUS 946,465.64, OR A TOTAL OF PHP3,428,813.80
FROM THE CURRENT TOTAL SUPPORT IN ARREARS OF THE RESPONDENT TO THE PETITIONER AND THEIR CHILDREN.17

The main issue is whether certain expenses already incurred by the respondent may be deducted from the total support in arrears owing to petitioner and her children pursuant to the
Decision dated April 12, 2005 in CA-G.R. SP No. 84740.

The pertinent provision of the Family Code of the Philippines provides:

Article 194. Support comprises everything indispensable for sustenance, dwelling, clothing, medical attendance, education and transportation, in keeping with the financial capacity of
the family.

The education of the person entitled to be supported referred to in the preceding paragraph shall include his schooling or training for some profession, trade or vocation, even beyond
the age of majority. Transportation shall include expenses in going to and from school, or to and from place of work. (Emphasis supplied.)

Petitioner argues that it was patently erroneous for the CA to have allowed the deduction of the value of the two cars and their maintenance costs from the support in arrears, as these
items are not indispensable to the sustenance of the family or in keeping them alive. She points out that in the Decision in CA-G.R. SP No. 84740, the CA already considered the said
items which it deemed chargeable to respondent, while the monthly support pendente lite (P115,000.00) was fixed on the basis of the documentary evidence of respondents alleged
income from various businesses and petitioners testimony that she needed P113,000.00 for the maintenance of the household and other miscellaneous expenses excluding
the P135,000.00 medical attendance expenses of petitioner.

Respondent, on the other hand, contends that disallowing the subject deductions would result in unjust enrichment, thus making him pay for the same obligation twice. Since petitioner
and the children resided in one residence, the groceries and dry goods purchased by the children using respondents credit card, totalling P594,151.58 for the period September 2003 to
June 2005 were not consumed by the children alone but shared with their mother. As to the Volkswagen Beetle and BMW 316i respondent bought for his daughter Angelli Suzanne Lua
and Daniel Ryan Lua, respectively, these, too, are to be considered advances for support, in keeping with the financial capacity of the family. Respondent stressed that being children of
parents belonging to the upper-class society, Angelli and Daniel Ryan had never in their entire life commuted from one place to another, nor do they eat their meals at "carinderias".
Hence, the cars and their maintenance are indispensable to the childrens day-to-day living, the value of which were properly deducted from the arrearages in support pendente lite
ordered by the trial and appellate courts.

As a matter of law, the amount of support which those related by marriage and family relationship is generally obliged to give each other shall be in proportion to the resources or means
of the giver and to the needs of the recipient.18 Such support comprises everything indispensable for sustenance, dwelling, clothing, medical attendance, education and transportation,
in keeping with the financial capacity of the family.

Upon receipt of a verified petition for declaration of absolute nullity of void marriage or for annulment of voidable marriage, or for legal separation, and at any time during the proceeding,
the court, motu proprio or upon verified application of any of the parties, guardian or designated custodian, may temporarily grant support pendente lite prior to the rendition of judgment
or final order.19 Because of its provisional nature, a court does not need to delve fully into the merits of the case before it can settle an application for this relief. All that a court is tasked
to do is determine the kind and amount of evidence which may suffice to enable it to justly resolve the application. It is enough that the facts be established by affidavits or other
documentary evidence appearing in the record.20

In this case, the amount of monthly support pendente lite for petitioner and her two children was determined after due hearing and submission of documentary evidence by the parties.
Although the amount fixed by the trial court was reduced on appeal, it is clear that the monthly support pendente lite of P115,000.00 ordered by the CA was intended primarily for the
sustenance of petitioner and her children, e.g., food, clothing, salaries of drivers and house helpers, and other household expenses. Petitioners testimony also mentioned the cost of
regular therapy for her scoliosis and vitamins/medicines.

ATTY. ZOSA:

xxxx

Q How much do you spend for your food and your two (2) children every month?

A Presently, Sir?

ATTY. ZOSA:

Yes.

A For the food alone, I spend not over P40,000.00 to P50,000.00 a month for the food alone.

xxxx

ATTY. ZOSA:

Q What other expenses do you incur in living in that place?

A The normal household and the normal expenses for a family to have a decent living, Sir.

Q How much other expenses do you incur?

WITNESS:

A For other expenses, is around over a P100,000.00, Sir.

Q Why do you incur that much amount?

A For the clothing for the three (3) of us, for the vitamins and medicines. And also I am having a special therapy to straighten my back because I am scoliotic. I am advised by the
Doctor to hire a driver, but I cannot still afford it now. Because my eyesight is not reliable for driving. And I still need another househelp to accompany me whenever I go marketing
because for my age, I cannot carry anymore heavy loads.

xxxx

ATTY. FLORES:

xxxx

Q On the issue of the food for you and the two (2) children, you mentioned P40,000.00 to P50,000.00?

A Yes, for the food alone.

Q Okay, what other possible expenses that you would like to include in those two (2) items? You mentioned of a driver, am I correct?

A Yes, I might need two (2) drivers, Sir for me and my children.

Q Okay. How much would you like possibly to pay for those two (2) drivers?

A I think P10,000.00 a month for one (1) driver. So I need two (2) drivers. And I need another househelp.

Q You need another househelp. The househelp nowadays would charge you something between P3,000.00 toP4,000.00. Thats quite

A Right now, my househelp is receiving P8,000.00. I need another which I will give a compensation of P5,000.00.

Q Other than that, do you still have other expenses?

A My clothing.

COURT:

How about the schooling for your children?

WITNESS:

A The schooling is shouldered by my husband, Your Honor.

COURT:

Everything?

A Yes, Your Honor.

xxxx

ATTY. FLORES:

Q Madam witness, let us talk of the present needs. x x x. What else, what specific need that you would like to add so I can tell my client, the defendant.

WITNESS:

A I need to have an operation both of my eyes. I also need a special therapy for my back because I am scoliotic, three (3) times a week.

Q That is very reasonable. [W]ould you care to please repeat that?

A Therapy for my scoliotic back and then also for the operation both of my eyes. And I am also taking some vitamins from excel that will cost P20,000.00 a month.

Q Okay. Lets have piece by piece. Have you asked the Doctor how much would it cost you for the operation of that scoliotic?

A Yes before because I was already due last year. Before, this eye will cost P60,000.00 and the other eyesP75,000.00.

Q So for both eyes, you are talking of P60,000.00 plus P75,000.00 is P135,000.00?

A Yes.

xxxx

Q You talk of therapy?

A Yes.

Q So how much is that?

A Around P5,000.00 a week.21

As to the financial capacity of the respondent, it is beyond doubt that he can solely provide for the subsistence, education, transportation, health/medical needs and recreational
activities of his children, as well as those of petitioner who was then unemployed and a full-time housewife. Despite this, respondents counsel manifested during the same hearing that
respondent was willing to grant the amount of only P75,000.00 as monthly support pendente lite both for the children and petitioner as spousal support. Though the receipts of
expenses submitted in court unmistakably show how much respondent lavished on his children, it appears that the matter of spousal support was a different matter altogether. Rejecting
petitioners prayer for P500,000.00 monthly support and finding the P75,000.00 monthly support offered by respondent as insufficient, the trial court fixed the monthly support pendente
lite at P250,000.00. However, since the supposed income in millions of respondent was based merely on the allegations of petitioner in her complaint and registration documents of
various corporations which respondent insisted are owned not by him but his parents and siblings, the CA reduced the amount of support pendente lite toP115,000.00, which ruling was
no longer questioned by both parties.

Controversy between the parties resurfaced when respondents compliance with the final CA decision indicated that he deducted from the total amount in arrears (P2,645,000.00) the
sum of P2,482,348.16, representing the value of the two cars for the children, their cost of maintenance and advances given to petitioner and his children. Respondent explained that
the deductions were made consistent with the fallo of the CA Decision in CA-G.R. SP No. 84740 ordering him to pay support pendente lite in arrears less the amount supposedly given
by him to petitioner as her and their two childrens monthly support.

The following is a summary of the subject deductions under Compliance dated June 28, 2005, duly supported by receipts22:

Car purchases for Angelli Suzanne and Daniel Ryan Car Maintenance fees of Angelli -

Php1,350,000.00
613,472.86
51,232.50

Suzanne
Credit card statements of Daniel Ryan -

348,682.28

Car Maintenance fees of Daniel Ryan -

118,960.52

Php2,482,348.16

After the trial court disallowed the foregoing deductions, respondent filed a motion for reconsideration further asserting that the following amounts, likewise with supporting receipts, be
considered as additional advances given to petitioner and the children23:

Medical expenses of Susan Lim-Lua

Php 42,450.71

Dental Expenses of Daniel Ryan

11,500.00

Travel expenses of Susan Lim-Lua

14,611.15

Credit card purchases of Angelli

408,891.08

Suzanne
Salon and travel expenses of Angelli

87,112.70

Suzanne
School expenses of Daniel Ryan Lua

260,900.00

Cash given to Daniel and Angelli

121,000.00

TOTAL -

GRAND TOTAL -

Php 946,465.64

Php 3,428,813.80

The CA, in ruling for the respondent said that all the foregoing expenses already incurred by the respondent should, in equity, be considered advances which may be properly deducted
from the support in arrears due to the petitioner and the two children. Said court also noted the absence of petitioners contribution to the joint obligation of support for their children.

We reverse in part the decision of the CA.

Judicial determination of support pendente lite in cases of legal separation and petitions for declaration of nullity or annulment of marriage are guided by the following provisions of the
Rule on Provisional Orders24

Sec. 2. Spousal Support.In determining support for the spouses, the court may be guided by the following rules:

(a) In the absence of adequate provisions in a written agreement between the spouses, the spouses may be supported from the properties of the absolute community or
the conjugal partnership.

(b) The court may award support to either spouse in such amount and for such period of time as the court may deem just and reasonable based on their standard of living
during the marriage.

(c) The court may likewise consider the following factors: (1) whether the spouse seeking support is the custodian of a child whose circumstances make it appropriate for
that spouse not to seek outside employment; (2) the time necessary to acquire sufficient education and training to enable the spouse seeking support to find appropriate
employment, and that spouses future earning capacity; (3) the duration of the marriage; (4) the comparative financial resources of the spouses, including their
comparative earning abilities in the labor market; (5) the needs and obligations of each spouse; (6) the contribution of each spouse to the marriage, including services
rendered in home-making, child care, education, and career building of the other spouse; (7) the age and health of the spouses; (8) the physical and emotional conditions
of the spouses; (9) the ability of the supporting spouse to give support, taking into account that spouses earning capacity, earned and unearned income, assets, and
standard of living; and (10) any other factor the court may deem just and equitable.

(d) The Family Court may direct the deduction of the provisional support from the salary of the spouse.

Sec. 3. Child Support.The common children of the spouses shall be supported from the properties of the absolute community or the conjugal partnership.

Subject to the sound discretion of the court, either parent or both may be ordered to give an amount necessary for the support, maintenance, and education of the child. It shall be in
proportion to the resources or means of the giver and to the necessities of the recipient.

In determining the amount of provisional support, the court may likewise consider the following factors: (1) the financial resources of the custodial and non-custodial parent and those of
the child; (2) the physical and emotional health of the child and his or her special needs and aptitudes; (3) the standard of living the child has been accustomed to; (4) the non-monetary
contributions that the parents will make toward the care and well-being of the child.

The Family Court may direct the deduction of the provisional support from the salary of the parent.

Since the amount of monthly support pendente lite as fixed by the CA was not appealed by either party, there is no controversy as to its sufficiency and reasonableness. The dispute
concerns the deductions made by respondent in settling the support in arrears.

On the issue of crediting of money payments or expenses against accrued support, we find as relevant the following rulings by US courts.

In Bradford v. Futrell,25 appellant sought review of the decision of the Circuit Court which found him in arrears with his child support payments and entered a decree in favor of appellee
wife. He complained that in determining the arrearage figure, he should have been allowed full credit for all money and items of personal property given by him to the children
themselves, even though he referred to them as gifts. The Court of Appeals of Maryland ruled that in the suit to determine amount of arrears due the divorced wife under decree for
support of minor children, the husband (appellant) was not entitled to credit for checks which he had clearly designated as gifts, nor was he entitled to credit for an automobile given to
the oldest son or a television set given to the children. Thus, if the children remain in the custody of the mother, the father is not entitled to credit for money paid directly to the children if
such was paid without any relation to the decree.

In the absence of some finding of consent by the mother, most courts refuse to allow a husband to dictate how he will meet the requirements for support payments when the mode of
payment is fixed by a decree of court. Thus he will not be credited for payments made when he unnecessarily interposed himself as a volunteer and made payments direct to the
children of his own accord. Wills v. Baker, 214 S. W. 2d 748 (Mo. 1948); Openshaw v. Openshaw, 42 P. 2d 191 (Utah 1935). In the latter case the court said in part: "The payments to
the children themselves do not appear to have been made as payments upon alimony, but were rather the result of his fatherly interest in the welfare of those children. We do not
believe he should be permitted to charge them to plaintiff. By so doing he would be determining for Mrs. Openshaw the manner in which she should expend her allowances. It is a very
easy thing for children to say their mother will not give them money, especially as they may realize that such a plea is effective in attaining their ends. If she is not treating them right the
courts are open to the father for redress."26

In Martin, Jr. v. Martin,27 the Supreme Court of Washington held that a father, who is required by a divorce decree to make child support payments directly to the mother, cannot claim
credit for payments voluntarily made directly to the children. However, special considerations of an equitable nature may justify a court in crediting such payments on his indebtedness
to the mother, when such can be done without injustice to her.

The general rule is to the effect that when a father is required by a divorce decree to pay to the mother money for the support of their dependent children and the unpaid and accrued
installments become judgments in her favor, he cannot, as a matter of law, claim credit on account of payments voluntarily made directly to the children. Koon v. Koon, supra; Briggs v.

Briggs, supra. However, special considerations of an equitable nature may justify a court in crediting such payments on his indebtedness to the mother, when that can be done without
injustice to her. Briggs v. Briggs, supra. The courts are justifiably reluctant to lay down any general rules as to when such credits may be allowed.28 (Emphasis supplied.)

Here, the CA should not have allowed all the expenses incurred by respondent to be credited against the accrued support pendente lite. As earlier mentioned, the monthly support
pendente lite granted by the trial court was intended primarily for food, household expenses such as salaries of drivers and house helpers, and also petitioners scoliosis therapy
sessions. Hence, the value of two expensive cars bought by respondent for his children plus their maintenance cost, travel expenses of petitioner and Angelli, purchases through credit
card of items other than groceries and dry goods (clothing) should have been disallowed, as these bear no relation to the judgment awarding support pendente lite. While it is true that
the dispositive portion of the executory decision in CA-G.R. SP No. 84740 ordered herein respondent to pay the support in arrears "less than the amount supposedly given by petitioner
to the private respondent as her and their two (2) children monthly support," the deductions should be limited to those basic needs and expenses considered by the trial and appellate
courts. The assailed ruling of the CA allowing huge deductions from the accrued monthly support of petitioner and her children, while correct insofar as it commends the generosity of
the respondent to his children, is clearly inconsistent with the executory decision in CA-G.R. SP No. 84740. More important, it completely ignores the unfair consequences to petitioner
whose sustenance and well-being, was given due regard by the trial and appellate courts. This is evident from the March 31, 2004 Order granting support pendente lite to petitioner and
her children, when the trial court observed:

While there is evidence to the effect that defendant is giving some forms of financial assistance to his two (2) children via their credit cards and paying for their school expenses, the
same is, however, devoid of any form of spousal support to the plaintiff, for, at this point in time, while the action for nullity of marriage is still to be heard, it is incumbent upon the
defendant, considering the physical and financial condition of the plaintiff and the overwhelming capacity of defendant, to extend support unto the latter. x x x29

On appeal, while the Decision in CA-G.R. SP No. 84740 reduced the amount of monthly support fixed by the trial court, it nevertheless held that considering respondents financial
resources, it is but fair and just that he give a monthly support for the sustenance and basic necessities of petitioner and his children. This would imply that any amount respondent
seeks to be credited as monthly support should only cover those incurred for sustenance and household expenses.1avvphi1

In the case at bar, records clearly show and in fact has been admitted by petitioner that aside from paying the expenses of their two (2) childrens schooling, he gave his two (2) children
two (2) cars and credit cards of which the expenses for various items namely: clothes, grocery items and repairs of their cars were chargeable to him which totaled an amount of more
than One Hundred Thousand (P100,000.00) for each of them and considering that as testified by the private respondent that she needs the total amount of P113,000.00 for the
maintenance of the household and other miscellaneous expenses and considering further that petitioner can afford to buy cars for his two (2) children, and to pay the expenses incurred
by them which are chargeable to him through the credit cards he provided them in the amount of P100,000.00 each, it is but fair and just that the monthly support pendente lite for his
wife, herein private respondent, be fixed as of the present in the amount of P115,000.00 which would be sufficient enough to take care of the household and other needs. This monthly
support pendente lite to private respondent in the amount of P115,000.00 excludes the amount of One Hundred ThirtyFive (P135,000.00) Thousand Pesos for medical attendance
expenses needed by private respondent for the operation of both her eyes which is demandable upon the conduct of such operation. Likewise, this monthly support of P115,000.00 is
without prejudice to any increase or decrease thereof that the trial court may grant private respondent as the circumstances may warrant i.e. depending on the proof submitted by the
parties during the proceedings for the main action for support.

The amounts already extended to the two (2) children, being a commendable act of petitioner, should be continued by him considering the vast financial resources at his
disposal.30 (Emphasis supplied.)

Accordingly, only the following expenses of respondent may be allowed as deductions from the accrued support pendente lite for petitioner and her children:

1wphi1
Medical expenses of Susan Lim-Lua

Php 42,450.71

Dental Expenses of Daniel Ryan

11,500.00

Credit card purchases of Angelli

365,282.20

(Groceries and Dry Goods)

228,869.38

Credit Card purchases of Daniel Ryan

TOTAL

Php 648,102.29

As to the contempt charge, we sustain the CA in holding that respondent is not guilty of indirect contempt.

Contempt of court is defined as a disobedience to the court by acting in opposition to its authority, justice, and dignity. It signifies not only a willful disregard or disobedience of the
courts order, but such conduct which tends to bring the authority of the court and the administration of law into disrepute or, in some manner, to impede the due administration of
justice.31 To constitute contempt, the act must be done willfully and for an illegitimate or improper purpose.32 The good faith, or lack of it, of the alleged contemnor should be
considered.33

Respondent admittedly ceased or suspended the giving of monthly support pendente lite granted by the trial court, which is immediately executory. However, we agree with the CA that
respondents act was not contumacious considering that he had not been remiss in actually providing for the needs of his children. It is a matter of record that respondent continued
shouldering the full cost of their education and even beyond their basic necessities in keeping with the familys social status. Moreover, respondent believed in good faith that the trial
and appellate courts, upon equitable grounds, would allow him to offset the substantial amounts he had spent or paid directly to his children.

Respondent complains that petitioner is very much capacitated to generate income on her own because she presently maintains a boutique at the Ayala Center Mall in Cebu City and at
the same time engages in the business of lending money. He also claims that the two children have finished their education and are now employed in the family business earning their
own salaries.

Suffice it to state that the matter of increase or reduction of support should be submitted to the trial court in which the action for declaration for nullity of marriage was filed, as this Court
is not a trier of facts. The amount of support may be reduced or increased proportionately according to the reduction or increase of the necessities of the recipient and the resources or
means of the person obliged to support.34 As we held in Advincula v. Advincula35

Judgment for support does not become final. The right to support is of such nature that its allowance is essentially provisional; for during the entire period that a needy party is entitled
to support, his or her alimony may be modified or altered, in accordance with his increased or decreased needs, and with the means of the giver. It cannot be regarded as subject to
final determination.36

WHEREFORE, the petition is PARTLY GRANTED. The Decision dated April 20, 2006 of the Court of Appeals in CA-G.R. SP Nos. 01154 and 01315 is hereby MODIFIED to read as
follows:

"WHEREFORE, judgment is hereby rendered:

a) DISMISSING, for lack of merit, the case of Petition for Contempt of Court with Damages filed by Susan Lim Lua against Danilo Y. Lua with docket no. SP. CA-G.R. No.
01154;

b) GRANTING IN PART Danilo Y. Lua's Petition for Certiorari docketed as SP. CA-G.R. No. 01315. Consequently, the assailed Orders dated 27 September 2005 and 25
November 2005 of the Regional Trial Court, Branch 14, Cebu City issued in Civil Case No. CEB-29346 entitled "Susan Lim Lua versus Danilo Y. Lua, are hereby
NULLIFIED and SET ASIDE, and instead a new one is entered:

i. ORDERING the deduction of the amount of Php 648,102.29 from the support pendente lite in arrears of Danilo Y. Lua to his wife, Susan Lim Lua and their
two (2) children;

ii. ORDERING Danilo Y. Lua to resume payment of his monthly support of PhP115,000.00 pesos starting from the time payment of this amount was
deferred by him subject to the deduction aforementioned.

iii. DIRECTING the immediate execution of this judgment.

SO ORDERED."

No pronouncement as to costs.

SO ORDERED.

14. G.R. No. 183896

January 30, 2013

SYED AZHAR ABBAS, Petitioner,

vs.
GLORIA GOO ABBAS, Respondent.

DECISION

VELASCO, JR., J.:

This is a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure, questioning the Decision1 of the Court of Appeals (CA) dated March 11, 2008 in CA-G.R.
CV No. 86760, which reversed the Decision2 in Civil Case No. 03-0382-CFM dated October 5, 2005 of the Regional Trial Court (RTC), Branch 109, Pasay City, and the CA Resolution
dated July 24, 2008, denying petitioner's Motion for Reconsideration of the CA Decision.

The present case stems from a petition filed by petitioner Syed Azhar Abbas (Syed) for the declaration of nullity of his marriage to Gloria Goo-Abbas (Gloria) with the RTC of Pasay
City, docketed as Civil Case No. 03-0382-CFM, and raffled to RTC Branch 109. Syed alleged the absence of a marriage license, as provided for in Article 4, Chapter I, Title 1 of
Executive Order No. 269, otherwise known as the Family Code of the Philippines, as a ground for the annulment of his marriage to Gloria.

In the Marriage Contract3 of Gloria and Syed, it is stated that Marriage License No. 9969967, issued at Carmona, Cavite on January 8, 1993, was presented to the solemnizing officer.
It is this information that is crucial to the resolution of this case.

At the trial court, Syed, a Pakistani citizen, testified that he met Gloria, a Filipino citizen, in Taiwan in 1991, and they were married on August 9, 1992 at the Taipei Mosque in
Taiwan.4 He arrived in the Philippines in December of 1992. On January 9, 1993, at around 5 oclock in the afternoon, he was at his mother-in-laws residence, located at 2676 F.
Muoz St., Malate, Manila, when his mother-in-law arrived with two men. He testified that he was told that he was going to undergo some ceremony, one of the requirements for his stay
in the Philippines, but was not told of the nature of said ceremony. During the ceremony he and Gloria signed a document. He claimed that he did not know that the ceremony was a
marriage until Gloria told him later. He further testified that he did not go to Carmona, Cavite to apply for a marriage license, and that he had never resided in that area. In July of 2003,
he went to the Office of the Civil Registrar of Carmona, Cavite, to check on their marriage license, and was asked to show a copy of their marriage contract wherein the marriage license
number could be found.5 The Municipal Civil Registrar, Leodivinia C. Encarnacion, issued a certification on July 11, 2003 to the effect that the marriage license number appearing in the
marriage contract he submitted, Marriage License No. 9969967, was the number of another marriage license issued to a certain Arlindo Getalado and Myra Mabilangan.6 Said
certification reads as follows:

11 July 2003

TO WHOM IT MAY CONCERN:

This is to certify as per Registry Records of Marriage License filed in this office, Marriage License No. 9969967 was issued in favor of MR. ARLINDO GETALADO and MISS MYRA
MABILANGAN on January 19, 1993.

No Marriage License appear [sic] to have been issued to MR. SYED AZHAR ABBAS and MISS GLORIA F. GOO on January 8, 1993.

This certification is being issued to Mr. Syed Azhar Abbas for whatever legal purpose or intents it may serve.7

On cross-examination, Syed testified that Gloria had filed bigamy cases against him in 2001 and 2002, and that he had gone to the Municipal Civil Registrar of Carmona, Cavite to get
certification on whether or not there was a marriage license on advice of his counsel.8

Petitioner also presented Norberto Bagsic (Bagsic), an employee of the Municipal Civil Registrar of Carmona, Cavite. Bagsic appeared under a letter of authority from the Municipal Civil
Registrar of Carmona, Cavite, and brought documents pertaining to Marriage License No. 9969967, which was issued to Arlindo Getalado and Myra Mabilangan on January 20, 1993.9

Bagsic testified that their office issues serial numbers for marriage licenses and that the numbers are issued chronologically.10 He testified that the certification dated July 11, 2003,
was issued and signed by Leodivina Encarnacion, Registrar of the Municipality of Carmona, Cavite, certifying that Marriage License No. 9969967 was issued for Arlindo Getalado and
Myra Mabilangan on January 19, 1993, and that their office had not issued any other license of the same serial number, namely 9969967, to any other person.11

For her part, Gloria testified on her own behalf, and presented Reverend Mario Dauz, Atty. Lorenzo Sanchez, Felicitas Goo and May Ann Ceriola.

Reverend Mario Dauz (Rev. Dauz) testified that he was a minister of the Gospel and a barangay captain, and that he is authorized to solemnize marriages within the Philippines.12 He
testified that he solemnized the marriage of Syed Azhar Abbas and Gloria Goo at the residence of the bride on January 9, 1993.13 He stated that the witnesses were Atty. Lorenzo
Sanchez (Atty. Sanchez) and Mary Ann Ceriola.14 He testified that he had been solemnizing marriages since 1982, and that he is familiar with the requirements.15 Rev. Dauz further
testified that Atty. Sanchez gave him the marriage license the day before the actual wedding, and that the marriage contract was prepared by his secretary.16 After the solemnization of
the marriage, it was registered with the Local Civil Registrar of Manila, and Rev. Dauz submitted the marriage contract and copy of the marriage license with that office.17

Atty. Sanchez testified that he was asked to be the sponsor of the wedding of Syed Abbas and Gloria Goo by the mother of the bride, Felicitas Goo.18 He testified that he requested a
certain Qualin to secure the marriage license for the couple, and that this Qualin secured the license and gave the same to him on January 8, 1993.19 He further testified that he did not
know where the marriage license was obtained.20 He attended the wedding ceremony on January 9, 1993, signed the marriage contract as sponsor, and witnessed the signing of the
marriage contract by the couple, the solemnizing officer and the other witness, Mary Ann Ceriola.21

Felicitas Goo testified that Gloria Goo is her daughter and Syed Azhar Abbas is her son-in-law, and that she was present at the wedding ceremony held on January 9, 1993 at her
house.22 She testified that she sought the help of Atty. Sanchez at the Manila City Hall in securing the marriage license, and that a week before the marriage was to take place, a male
person went to their house with the application for marriage license.23 Three days later, the same person went back to their house, showed her the marriage license before returning it
to Atty. Sanchez who then gave it to Rev. Dauz, the solemnizing officer.24 She further testified that she did not read all of the contents of the marriage license, and that she was told
that the marriage license was obtained from Carmona.25 She also testified that a bigamy case had been filed by Gloria against Syed at the Regional Trial Court of Manila, evidenced by
an information for Bigamy dated January 10, 2003, pending before Branch 47 of the Regional Trial Court of Manila.26

As to Mary Ann Ceriolas testimony, the counsels for both parties stipulated that: (a) she is one of the sponsors at the wedding of Gloria Goo and Syed Abbas on January 9, 1993; (b)
she was seen in the wedding photos and she could identify all the persons depicted in said photos; and (c) her testimony corroborates that of Felicitas Goo and Atty. Sanchez.

The respondent, Gloria, testified that Syed is her husband, and presented the marriage contract bearing their signatures as proof.27 She and her mother sought the help of Atty.
Sanchez in securing a marriage license, and asked him to be one of the sponsors. A certain Qualin went to their house and said that he will get the marriage license for them, and after
several days returned with an application for marriage license for them to sign, which she and Syed did. After Qualin returned with the marriage license, they gave the license to Atty.
Sanchez who gave it to Rev. Dauz, the solemnizing officer. Gloria testified that she and Syed were married on January 9, 1993 at their residence.28

Gloria further testified that she has a daughter with Syed, born on June 15, 1993.29

Gloria also testified that she filed a bigamy case against Syed, who had married a certain Maria Corazon Buenaventura during the existence of the previous marriage, and that the case
was docketed as Criminal Case No. 02A-03408, with the RTC of Manila.30

Gloria stated that she and Syed had already been married on August 9, 1992 in Taiwan, but that she did not know if said marriage had been celebrated under Muslim rites, because the
one who celebrated their marriage was Chinese, and those around them at the time were Chinese.31

The Ruling of the RTC

In its October 5, 2005 Decision, the Pasay City RTC held that no valid marriage license was issued by the Municipal Civil Registrar of Carmona, Cavite in favor of Gloria and Syed, as
Marriage License No. 9969967 had been issued to Arlindo Getalado and Myra Mabilangan, and the Municipal Civil Registrar of Carmona, Cavite had certified that no marriage license
had been issued for Gloria and Syed.32 It also took into account the fact that neither party was a resident of Carmona, Cavite, the place where Marriage License No. 9969967 was
issued, in violation of Article 9 of the Family Code.33 As the marriage was not one of those exempt from the license requirement, and that the lack of a valid marriage license is an
absence of a formal requisite, the marriage of Gloria and Syed on January 9, 1993 was void ab initio.

The dispositive portion of the Decision reads as follows:

WHEREFORE, judgment is hereby rendered in favor of the petitioner, and against the respondent declaring as follows:

1. The marriage on January 9, 1993 between petitioner Syed Azhar Abbas and respondent Gloria Goo-Abbas is hereby annulled;

2. Terminating the community of property relations between the petitioner and the respondent even if no property was acquired during their cohabitation by reason of the
nullity of the marriage of the parties.

3. The Local Civil Registrar of Manila and the Civil Registrar General, National Statistics Office, are hereby ordered to cancel from their respective civil registries the
marriage contracted by petitioner Syed Azhar Abbas and respondent Gloria Goo-Abbas on January 9, 1993 in Manila.

SO ORDERED.34

Gloria filed a Motion for Reconsideration dated November 7, 2005, but the RTC denied the same, prompting her to appeal the questioned decision to the Court of Appeals.

The Ruling of the CA

In her appeal to the CA, Gloria submitted the following assignment of errors:

THE LOWER COURT ERRED IN DECLARING THE MARRIAGE BETWEEN THE PETITIONER AND RESPONDENT AS NULL AND VOID DUE TO THE ABSENCE OF
A MARRIAGE LICENSE DESPITE EVIDENCE CLEARLY SHOWING THAT THERE WAS ONE.

II

THE LOWER COURT ERRED IN NOT CONSIDERING, AS A REQUISITE OF A VALID MARRIAGE, THE OVERWHELMING EVIDENCE SHOWING THAT A
MARRIAGE CEREMONY TOOK PLACE WITH THE APPEARANCE OF THE CONTRACTING PARTIES BEFORE THE SOLEMNIZING OFFICER AND THEIR
PERSONAL DECLARATION THAT THEY TOOK EACH OTHER AS HUSBAND AND WIFE IN THE PRESENCE OF NOT LESS THAN TWO WITNESSES OF LEGAL
AGE.

III

THE LOWER COURT ERRED IN NOT RULING ON THE ISSUE OF ESTOPPEL BY LACHES ON THE PART OF THE PETITIONER, AN ISSUE TIMELY RAISED IN
THE COURT BELOW.35

The CA gave credence to Glorias arguments, and granted her appeal. It held that the certification of the Municipal Civil Registrar failed to categorically state that a diligent search for
the marriage license of Gloria and Syed was conducted, and thus held that said certification could not be accorded probative value.36 The CA ruled that there was sufficient testimonial
and documentary evidence that Gloria and Syed had been validly married and that there was compliance with all the requisites laid down by law.37

It gave weight to the fact that Syed had admitted to having signed the marriage contract. The CA also considered that the parties had comported themselves as husband and wife, and
that Syed only instituted his petition after Gloria had filed a case against him for bigamy.38

The dispositive portion of the CA Decision reads as follows:

WHEREFORE, premises considered, the appeal is GRANTED. The Decision dated 05 October 2005 and Order dated 27 January 2006 of the Regional Trial Court of Pasay City,
Branch 109, in Civil Case No. 03-0382-CFM are REVERSED and SET ASIDE and the Petition for Declaration of Nullity of Marriage is DISMISSED. The marriage between Shed [sic]
Azhar Abbas and Gloria Goo Abbas contracted on 09 January 1993 remains valid and subsisting. No costs.

SO ORDERED.39

Syed then filed a Motion for Reconsideration dated April 1, 200840 but the same was denied by the CA in a Resolution dated July 24, 2008.41

Hence, this petition.

Grounds in Support of Petition

THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR OF LAW IN CITING REPUBLIC VS. COURT OF APPEALS AS THE SAME IS
DIAMETRICALLY INCONSISTENT AND CONTRARY TO THE COURTS OWN FINDINGS AND CONCLUSIONS IN THIS CASE.

II

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN REVERSING AND SETTING ASIDE, WITHOUT ANY FACTUAL AND LEGAL BASIS, THE DECISION
OF THE REGIONAL TRIAL COURT GRANTING THE PETITION FOR DECLARATION OF NULLITY OF MARRIAGE.42

The Ruling of this Court

The petition is meritorious.

As the marriage of Gloria and Syed was solemnized on January 9, 1993, Executive Order No. 209, or the Family Code of the Philippines, is the applicable law. The pertinent provisions
that would apply to this particular case are Articles 3, 4 and 35(3), which read as follows:

Art. 3. The formal requisites of marriage are:

(1) Authority of the solemnizing officer;

(2) A valid marriage license except in the cases provided for in Chapter 2 of this Title; and

(3) A marriage ceremony which takes place with the appearance of the contracting parties before the solemnizing officer and their personal declaration that they take
each other as husband and wife in the presence of not less than two witnesses of legal age.

Art. 4. The absence of any of the essential or formal requisites shall render the marriage void ab initio, except as stated in Article 35(2).

A defect in any of the essential requisites shall render the marriage voidable as provided in Article 45.

An irregularity in the formal requisites shall not affect the validity of the marriage but the party or parties responsible for the irregularity shall be civilly, criminally and administratively
liable.

Art. 35. The following marriages shall be void from the beginning:

xxxx

(3) Those solemnized without a license, except those covered by the preceding Chapter.

There is no issue with the essential requisites under Art. 2 of the Family Code, nor with the formal requisites of the authority of the solemnizing officer and the conduct of the marriage
ceremony. Nor is the marriage one that is exempt from the requirement of a valid marriage license under Chapter 2, Title I of the Family Code. The resolution of this case, thus, hinges
on whether or not a valid marriage license had been issued for the couple. The RTC held that no valid marriage license had been issued. The CA held that there was a valid marriage
license.

We find the RTC to be correct in this instance.

Respondent Gloria failed to present the actual marriage license, or a copy thereof, and relied on the marriage contract as well as the testimonies of her witnesses to prove the existence
of said license. To prove that no such license was issued, Syed turned to the office of the Municipal Civil Registrar of Carmona, Cavite which had allegedly issued said license. It was
there that he requested certification that no such license was issued. In the case of Republic v. Court of Appeals43 such certification was allowed, as permitted by Sec. 29, Rule 132 of
the Rules of Court, which reads:

SEC. 28. Proof of lack of record. A written statement signed by an officer having the custody of an official record or by his deputy that after diligent search, no record or entry of a
specified tenor is found to exist in the records of his office, accompanied by a certificate as above provided, is admissible as evidence that the records of his office contain no such
record or entry.

In the case of Republic, in allowing the certification of the Civil Registrar of Pasig to prove the non-issuance of a marriage license, the Court held:

The above Rule authorized the custodian of the documents to certify that despite diligent search, a particular document does not exist in his office or that a particular entry of a specified
tenor was not to be found in a register. As custodians of public documents, civil registrars are public officers charged with the duty, inter alia, of maintaining a register book where they
are required to enter all applications for marriage licenses, including the names of the applicants, the date the marriage license was issued and such other relevant data.44

The Court held in that case that the certification issued by the civil registrar enjoyed probative value, as his duty was to maintain records of data relative to the issuance of a marriage
license.

The Municipal Civil Registrar of Carmona, Cavite, where the marriage license of Gloria and Syed was allegedly issued, issued a certification to the effect that no such marriage license
for Gloria and Syed was issued, and that the serial number of the marriage license pertained to another couple, Arlindo Getalado and Myra Mabilangan. A certified machine copy of
Marriage License No. 9969967 was presented, which was issued in Carmona, Cavite, and indeed, the names of Gloria and Syed do not appear in the document.

In reversing the RTC, the CA focused on the wording of the certification, stating that it did not comply with Section 28, Rule 132 of the Rules of Court.

The CA deduced that from the absence of the words "despite diligent search" in the certification, and since the certification used stated that no marriage license appears to have been
issued, no diligent search had been conducted and thus the certification could not be given probative value.

To justify that deduction, the CA cited the case of Republic v. Court of Appeals.45 It is worth noting that in that particular case, the Court, in sustaining the finding of the lower court that
a marriage license was lacking, relied on the Certification issued by the Civil Registrar of Pasig, which merely stated that the alleged marriage license could not be located as the same
did not appear in their records. Nowhere in the Certification was it categorically stated that the officer involved conducted a diligent search, nor is a categorical declaration absolutely
necessary for Sec. 28, Rule 132 of the Rules of Court to apply.

Under Sec. 3(m), Rule 131 of the Rules of Court, it is a disputable presumption that an official duty has been regularly performed, absent contradiction or other evidence to the contrary.
We held, "The presumption of regularity of official acts may be rebutted by affirmative evidence of irregularity or failure to perform a duty."46 No such affirmative evidence was shown
that the Municipal Civil Registrar was lax in performing her duty of checking the records of their office, thus the presumption must stand. In fact, proof does exist of a diligent search
having been conducted, as Marriage License No. 996967 was indeed located and submitted to the court. The fact that the names in said license do not correspond to those of Gloria
and Syed does not overturn the presumption that the registrar conducted a diligent search of the records of her office.

It is telling that Gloria failed to present their marriage license or a copy thereof to the court. She failed to explain why the marriage license was secured in Carmona, Cavite, a location
where, admittedly, neither party resided. She took no pains to apply for the license, so she is not the best witness to testify to the validity and existence of said license. Neither could the
other witnesses she presented prove the existence of the marriage license, as none of them applied for the license in Carmona, Cavite. Her mother, Felicitas Goo, could not even testify
as to the contents of the license, having admitted to not reading all of its contents. Atty. Sanchez, one of the sponsors, whom Gloria and Felicitas Goo approached for assistance in
securing the license, admitted not knowing where the license came from. The task of applying for the license was delegated to a certain Qualin, who could have testified as to how the
license was secured and thus impeached the certification of the Municipal Civil Registrar as well as the testimony of her representative. As Gloria failed to present this Qualin, the
certification of the Municipal Civil Registrar still enjoys probative value.

It is also noted that the solemnizing officer testified that the marriage contract and a copy of the marriage license were submitted to the Local Civil Registrar of Manila. Thus, a copy of
the marriage license could have simply been secured from that office and submitted to the court. However, Gloria inexplicably failed to do so, further weakening her claim that there was
a valid marriage license issued for her and Syed.

In the case of Cario v. Cario,47 following the case of Republic,48 it was held that the certification of the Local Civil Registrar that their office had no record of a marriage license was
adequate to prove the non-issuance of said license. The case of Cario further held that the presumed validity of the marriage of the parties had been overcome, and that it became the
burden of the party alleging a valid marriage to prove that the marriage was valid, and that the required marriage license had been secured.49 Gloria has failed to discharge that
burden, and the only conclusion that can be reached is that no valid marriage license was issued. It cannot be said that there was a simple irregularity in the marriage license that would
not affect the validity of the marriage, as no license was presented by the respondent. No marriage license was proven to have been issued to Gloria and Syed, based on the
certification of the Municipal Civil Registrar of Carmona, Cavite and Glorias failure to produce a copy of the alleged marriage license.

To bolster its ruling, the CA cited other evidence to support its conclusion that Gloria and Syed were validly married. To quote the CA:

Moreover, the record is replete with evidence, testimonial and documentary, that appellant and appellee have been validly married and there was compliance with all the requisites laid
down by law. Both parties are legally capacitated to marry. A certificate of legal capacity was even issued by the Embassy of Pakistan in favor of appellee. The parties herein gave their
consent freely. Appellee admitted that the signature above his name in the marriage contract was his. Several pictures were presented showing appellant and appellee, before the
solemnizing officer, the witnesses and other members of appellants family, taken during the marriage ceremony, as well as in the restaurant where the lunch was held after the
marriage ceremony. Most telling of all is Exhibit "5-C" which shows appellee signing the Marriage Contract.

xxxx

The parties have comported themselves as husband and wife and has [sic] one offspring, Aliea Fatima Goo Abbas, who was born on 15 June 1993. It took appellee more than ten (10)
years before he filed on 01 August 2003 his Petition for Declaration of Nullity of Marriage under Article 4 of the Family Code. We take serious note that said Petition appears to have
been instituted by him only after an Information for Bigamy (Exhibit "1") dated 10 January 2003 was filed against him for contracting a second or subsequent marriage with one Ma.
Corazon (Maryam) T. Buenaventura. We are not ready to reward (appellee) by declaring the nullity of his marriage and give him his freedom and in the process allow him to profit from
his own deceit and perfidy.50

All the evidence cited by the CA to show that a wedding ceremony was conducted and a marriage contract was signed does not operate to cure the absence of a valid marriage license.
Article 4 of the Family Code is clear when it says, "The absence of any of the essential or formal requisites shall render the marriage void ab initio, except as stated in Article 35(2)."
Article 35(3) of the Family Code also provides that a marriage solemnized without a license is void from the beginning, except those exempt from the license requirement under Articles
27 to 34, Chapter 2, Title I of the same Code.51 Again, this marriage cannot be characterized as among the exemptions, and thus, having been solemnized without a marriage license,
is void ab initio.1wphi1

As to the motive of Syed in seeking to annul his marriage to Gloria, it may well be that his motives are less than pure, that he seeks to evade a bigamy suit. Be that as it may, the same
does not make up for the failure of the respondent to prove that they had a valid marriage license, given the weight of evidence presented by petitioner. The lack of a valid marriage
license cannot be attributed to him, as it was Gloria who took steps to procure the same. The law must be applied. As the marriage license, a formal requisite, is clearly absent, the
marriage of Gloria and Syed is void ab initio.

WHEREFORE, in light of the foregoing, the petition is hereby GRANTED. The assailed Decision dated March 11, 2008 and Resolution dated July 24, 2008 of the Court of Appeals in
CA-G.R. CV No. 86760 are hereby REVERSED and SET ASIDE. The Decision of the Regional Trial Court, Branch 109, Pasay City dated October 5, 2005 in Civil Case No. 03-0382CFM annulling the marriage of petitioner with respondent on January 9, 1993 is hereby REINSTATED.

No costs.

SO ORDERED.

15. A.M. No. MTJ-14-1842

February 24, 2014

[Formerly OCA IPI No. 12-2491-MTJ]

REX M. TUPAL, Complainant,

vs.
JUDGE REMEGIO V. ROJO, Branch 5, Municipal Trial Court in Cities (MTCC), Bacolod City, Negros Occidental, Respondent.

RESOLUTION

LEONEN, J.:

Municipal trial court judges cannot notarize affidavits of cohabitation of parties whose marriage they will solemnize.

Rex M. Tupal filed with the Office of the Court Administrator a complaint against Judge Remegio V. Rojo for violating the Code of Judicial Conduct and for gross ignorance of the law.1

Judge Remegio V. Rojo presides Municipal Trial Court in Cities, Branch 5, Bacolod City, Negros Occidental. Judge Rojo allegedly solemnized marriages without the required marriage
license. He instead notarized affidavits of cohabitation2 and issued them to the contracting parties.3 He notarized these affidavits on the day of the parties marriage.4 These "package
marriages" are allegedly common in Bacolod City.5

Rex annexed to his complaint-affidavit nine affidavits of cohabitation all notarized by Judge Rojo. All affidavits were notarized on the day of the contracting parties marriages.6 The
affidavits contained the following jurat:

SUBSCRIBED AND SWORN to before me this [date] at Bacolod City, Philippines.

(sgd.)
HON. REMEGIO V. ROJO
Judge7

For notarizing affidavits of cohabitation of parties whose marriage he solemnized, Judge Rojo allegedly violated Circular No. 1-90 dated February 26, 1990.8 Circular No. 1-90 allows
municipal trial court judges to act as notaries public ex officio and notarize documents only if connected with their official functions and duties. Rex argues that affidavits of cohabitation
are not connected with a judges official functions and duties as solemnizing officer.9 Thus, Judge Rojo cannot notarize ex officio affidavits of cohabitation of parties whose marriage he
solemnized.

Also, according to Rex, Judge Rojo allegedly violated the 2004 Rules on Notarial Practice. Judge Rojo notarized affidavits of cohabitation without affixing his judicial seal on the
affidavits. He also did not require the parties to present their competent pieces of evidence of identity as required by law.

These omissions allegedly constituted gross ignorance of the law as notarial rules "[are] x x x simple and elementary to ignore."10

Judge Rojo commented on the complaint.11 He argued that Rex was only harassing him. Rex is the father of Frialyn Tupal. Frialyn has a pending perjury case in Branch 5 for allegedly
making false statements in her affidavit of cohabitation. Rex only filed a complaint against Judge Rojo to delay Frialyns case.12

Judge Rojo did not deny notarizing the affidavits of cohabitation. He argued that notarizing affidavits of cohabitation was connected with his official functions and duties as a
judge.13 The Guidelines on the Solemnization of Marriage by the Members of the Judiciary14 does not prohibit judges from notarizing affidavits of cohabitation of parties whose
marriage they will solemnize.15 Thus, Judge Rojo did not violate Circular No. 1-90.

Judge Rojo also argued that he did not violate the 2004 Rules on Notarial Practice. He is a judge, not a notary public. Thus, he was not required to affix a notarial seal on the affidavits
he notarized.16

Also, Judge Rojo argued that he need not notarize the affidavits with the parties presenting their competent pieces of evidence of identity. Since he interviewed the parties as to the
contents of their affidavits, he personally knew them to be the same persons who executed the affidavit.17 The parties identities are "unquestionable."18

Judge Rojo alleged that other judges in Bacolod City and Talisay City also notarized affidavits of cohabitation of parties whose marriage they solemnized.19 He pleaded "not to make
him [complainant Tupals] doormat, punching bag and chopping block"20 since other judges also notarized affidavits of cohabitation.

In its report dated July 30, 2013, the Office of the Court Administrator found that Judge Rojo violated Circular No. 1-90. The Office of the Court Administrator recommended that Judge
Rojo be fined P9,000.00 and sternly warned that repeating the same offense will be dealt with more severely.

The Office of the Court Administrator ruled that affidavits of cohabitation are documents not connected with municipal trial court judges official functions and duties. Under the
Guidelines on the Solemnization of Marriage by the Members of the Judiciary,21 a judges duty is to personally examine the allegations in the affidavit of cohabitation before performing
the marriage ceremony.22 Nothing in the Guidelines authorizes judges to notarize affidavits of cohabitation of parties whose marriage they will solemnize.

Since Judge Rojo notarized without authority nine affidavits of cohabitation, the Office of the Court Administrator recommended a fine of P1,000.00 per affidavit of cohabitation
notarized.23

The issue is whether Judge Rojo is guilty of violating the New Code of Judicial Conduct and of gross ignorance of the law.

This court finds Judge Rojo guilty of violating the New Code of Judicial Conduct and of gross ignorance of the law. Judge Rojo violated Circular No. 1-90 and the 2004 Rules on Notarial
Practice.

Municipal trial court and municipal circuit trial court judges may act as notaries public. However, they may do so only in their ex officio capacities. They may notarize documents,
contracts, and other conveyances only in the exercise of their official functions and duties. Circular No. 1-90 dated February 26, 1990 provides:

Municipal trial court (MTC) and municipal circuit trial court (MCTC) judges are empowered to perform the function of notaries public ex officio under Section 76 of Republic Act No. 296,
as amended (otherwise known as the Judiciary Act of 1948) and Section 242 of the Revised Administrative Code. But the Court hereby lays down the following qualifications on the
scope of this power:

MTC and MCTC judges may act as notaries public ex officio in the notarization of documents connected only with the exercise of their official functions and duties x x x. They may not,
as notaries public ex officio, undertake the preparation and acknowledgment of private documents, contracts and other acts of conveyances which bear no direct relation to the
performance of their functions as judges. The 1989 Code of Judicial Conduct not only enjoins judges to regulate their extra-judicial activities in order to minimize the risk of conflict with
their judicial duties, but also prohibits them from engaging in the private practice of law (Canon 5 and Rule 5.07).

They may also act as notaries public ex officio only if lawyers or notaries public are lacking in their courts territorial jurisdiction. They must certify as to the lack of lawyers or notaries
public when notarizing documents ex officio:

However, the Court, taking judicial notice of the fact that there are still municipalities which have neither lawyers nor notaries public, rules that MTC and MCTC judges assigned to
municipalities or circuits with no lawyers or notaries public may, in the capacity as notaries public ex officio, perform any act within the competency of a regular notary public, provided
that: (1) all notarial fees charged be for the account of the Government and turned over to the municipal treasurer (Lapena, Jr. vs. Marcos, Adm. Matter No. 1969-MJ, June 29, 1982,
114 SCRA 572); and, (2) certification be made in the notarized documents attesting to the lack of any lawyer or notary public in such municipality or circuit.24

Judge Rojo notarized affidavits of cohabitation, which were documents not connected with the exercise of his official functions and duties as solemnizing officer. He also notarized
affidavits of cohabitation without certifying that lawyers or notaries public were lacking in his courts territorial jurisdiction. Thus, Judge Rojo violated Circular No. 1-90.

Before performing the marriage ceremony, the judge must personally interview the contracting parties and examine the requirements they submitted.25 The parties must have complied
with all the essential and formal requisites of marriage. Among these formal requisites is a marriage license.26

A marriage license is issued by the local civil registrar to parties who have all the qualifications and none of the legal disqualifications to contract marriage.27 Before performing the
marriage ceremony, the judge must personally examine the marriage license presented.28

If the contracting parties have cohabited as husband and wife for at least five years and have no legal impediment to marry, they are exempt from the marriage license
requirement.29 Instead, the parties must present an affidavit of cohabitation sworn to before any person authorized by law to administer oaths.30 The judge, as solemnizing officer,
must personally examine the affidavit of cohabitation as to the parties having lived together as husband and wife for at least five years and the absence of any legal impediment to
marry each other.31 The judge must also execute a sworn statement that he personally ascertained the parties qualifications to marry and found no legal impediment to the
marriage.32 Article 34 of the Family Code of the Philippines provides:

Art. 34. No license shall be necessary for the marriage of a man and a woman who have lived together as husband and wife for at least five years and without any legal impediment to
marry each other. The contracting parties shall state the foregoing facts in an affidavit before any person authorized by law to administer oaths. The solemnizing officer shall also state
under oath that he ascertained the qualifications of the contracting parties and found no legal impediment to the marriage.

Section 5 of the Guidelines on the Solemnization of Marriage by the Members of the Judiciary also provides:

Sec. 5. Other duties of solemnizing officer before the solemnization of the marriage in legal ratification of cohabitation. In the case of a marriage effecting legal ratification of
cohabitation, the solemnizing officer shall (a) personally interview the contracting parties to determine their qualifications to marry; (b) personally examine the affidavit of the contracting
parties as to the fact of having lived together as husband and wife for at least five [5] years and the absence of any legal impediments to marry each other; and (c) execute a sworn
statement showing compliance with (a) and (b) and that the solemnizing officer found no legal impediment to the marriage.

Based on law and the Guidelines on the Solemnization of Marriage by the Members of the Judiciary, the person who notarizes the contracting parties affidavit of cohabitation cannot be
the judge who will solemnize the parties marriage.

As a solemnizing officer, the judges only duty involving the affidavit of cohabitation is to examine whether the parties have indeed lived together for at least five years without legal
impediment to marry. The Guidelines does not state that the judge can notarize the parties affidavit of cohabitation.

Thus, affidavits of cohabitation are documents not connected with the judges official function and duty to solemnize marriages. Notarizing affidavits of cohabitation is inconsistent with
the duty to examine the parties requirements for marriage. If the solemnizing officer notarized the affidavit of cohabitation, he cannot objectively examine and review the affidavits
statements before performing the marriage ceremony. Should there be any irregularity or false statements in the affidavit of cohabitation he notarized, he cannot be expected to admit
that he solemnized the marriage despite the irregularity or false allegation.

Thus, judges cannot notarize the affidavits of cohabitation of the parties whose marriage they will solemnize. Affidavits of cohabitation are documents not connected with their official
function and duty to solemnize marriages.

Judge Rojo admitted that he notarized affidavits of cohabitation of parties "on the same day [he solemnized their marriages]."33 He notarized documents not connected with his official
function and duty to solemnize marriages. Thus, Judge Rojo violated Circular No. 1-90.

Judge Rojo argued that the Guidelines on the Solemnization of Marriage by the Members of the Judiciary does not expressly prohibit judges from notarizing affidavits of cohabitation.
Thus, he cannot be prohibited from notarizing affidavits of cohabitation.

To accept Judge Rojos argument will render the solemnizing officers duties to examine the affidavit of cohabitation and to issue a sworn statement that the requirements have been
complied with redundant. As discussed, a judge cannot objectively examine a document he himself notarized. Article 34 of the Family Code and the Guidelines on the Solemnization of
Marriage by the Members of the Judiciary assume that "the person authorized by law to administer oaths" who notarizes the affidavit of cohabitation and the "solemnizing officer" who
performs the marriage ceremony are two different persons.

Judge Rojo argued that Circular No. 1-90 only prohibits municipal trial court judges from notarizing "private documents x x x [bearing] no direct relation to the performance of their
functions as judges."34 Since a marriage license is a public document, its "counterpart," the affidavit of cohabitation, is also a public document. Thus, when he notarizes an affidavit of
cohabitation, he notarizes a public document. He did not violate Circular No. 1-90.

An affidavit of cohabitation remains a private document until notarized. Notarization converts a private document into a public document, "[rendering the document] admissible in court
without further proof of its authenticity."35 The affidavit of cohabitation, even if it serves a "public purpose," remains a private document until notarized.

Thus, when Judge Rojo notarized the affidavits of cohabitation, he notarized nine private documents. As discussed, affidavits of cohabitation are not connected with a judges official
duty to solemnize marriages. Judge Rojo violated Circular No. 1-90.

Judge Rojo argued that Circular No. 1-90s purpose is to "eliminate competition between judges and private lawyers in transacting legal conveyancing business."36 He cited Borre v.
Judge Moya37 where this court found City Judge Arcilla guilty of violating Circular No. 1-90 for notarizing a deed of sale. Judge Rojo argued that when he notarized the affidavits of
cohabitation, he did "not compete with private law practitioners or regular notaries in transacting legal conveyancing business."38 Thus, he did not violate Circular No. 1-90.

In Borre, Judge Arcilla notarized a deed of sale. This is the context in which this court stated that "[judges] should not compete with private [lawyers] or regular notaries in transacting
legal conveyancing business."39

At any rate, Circular No. 1-90s purpose is not limited to documents used to transact "legal conveyancing business." So long as a judge notarizes a document not connected with his
official functions and duties, he violates Circular No. 1-90.

Thus, in Mayor Quiones v. Judge Lopez, Jr.,40 this court fined Judge Lopez for notarizing a certificate of candidacy. In Ellert v. Judge Galapon, Jr.,41 this court fined Judge Galapon
for notarizing the verification page of an answer filed with the Department of Agrarian Reform Adjudication Board. The documents involved in these cases were not used to transact
"legal conveyancing business." Nevertheless, this court found Judge Lopez and Judge Galapon guilty of violating Circular No. 1-90.

Since Judge Rojo notarized affidavits of cohabitation, which were not connected with his official function and duty to solemnize marriages, he violated Circular No. 1-90.

Also, Judge Rojo notarized affidavits of cohabitation without certifying that lawyers or notaries public are lacking in Bacolod City. Failure to certify that lawyers or notaries public are
lacking in the municipality or circuit of the judges court constitutes violation of Circular No. 1-90.42

That other judges have notarized affidavits of cohabitation of parties whose marriages they solemnized does not make the practice legal. Violations of laws are not excused by practice
to the contrary.43

All told, Judge Rojo violated Circular No. 1-90.

Judge Rojo also violated the 2004 Rules on Notarial Practice. Rule IV, Section 2, paragraph (b) of the 2004 Rules on Notarial Practice prohibits a notary public from notarizing
documents if the signatory is not personally known to him. Otherwise, the notary public must require the signatory to present a competent evidence of identity:

SEC. 2. Prohibitions. x x x x

(b) A person shall not perform a notarial act if the person involved as signatory to the instrument or document -

(1) is not in the notary's presence personally at the time of the notarization; and

(2) is not personally known to the notary public or otherwise identified by the notary public through competent evidence of identity as defined by these Rules.

A competent evidence of identity guarantees that the person appearing before the notary public is the signatory to the instrument or document to be notarized. If the notary public does
not personally know the signatory, he must require the signatory to present a competent evidence of identity.

In all the nine affidavits of cohabitation Judge Rojo notarized, he only stated that the parties subscribed and swore to their affidavits before him. Judge Rojo did not state that the parties
were personally known to him or that the parties presented their competent pieces of evidence of identity. Thus, Judge Rojo violated the 2004 Rules on Notarial Practice.

Judge Rojo argued that he personally knew the parties to the affidavits of cohabitation. They personally appeared before him to subscribe to their affidavits of cohabitation. He also
interviewed them on their qualifications to contract marriage. Thus, the parties to the affidavit of cohabitation need not present their competent pieces of evidence of identity.44

That the parties appeared before Judge Rojo and that he interviewed them do not make the parties personally known to him. The parties are supposed to appear in person to subscribe
to their affidavits. To personally know the parties, the notary public must at least be acquainted with them.45 Interviewing the contracting parties does not make the parties personally
known to the notary public.

For violating Circular No. 1-90 and the 2004 Rules on Notarial Practice nine times, Judge Rojo is guilty of gross ignorance of the law.

Judge Rojo argued that he notarized the affidavits of cohabitation in good faith. He cited Santos v. Judge How46where this court held that "[g]ood faith and absence of malice, corrupt
motives or improper considerations x x x"47were defenses against gross ignorance of the law charges. His good faith in notarizing affidavits of cohabitation should not hold him
administratively liable.

However, this court also held in Santos that "good faith in situations of fallible discretion [inheres] only within the parameters of tolerable judgment x x x."48 Good faith "does not apply
where the issues are so simple and the applicable legal principles evident and basic as to be beyond possible margins of error."49

Circular No. 1-90 requires judges to certify that lawyers or notaries public are lacking in their courts territorial jurisdiction before notarizing documents. The 2004 Rules on Notarial
Practice requires notaries public to personally know the signatory to the document they will notarize or require the signatory to present a competent evidence of identity. These are basic
legal principles and procedure Judge Rojo violated. Failure to comply with these basic requirements nine times is not good faith.

Under the New Code of Judicial Conduct on integrity,50 "[j]udges shall ensure that not only is their conduct above reproach, but that it is perceived to be so in the view of a reasonable
observer."51 If the law involved is basic, ignorance constitutes "lack of integrity."52 Violating basic legal principles and procedure nine times is gross ignorance of the law.

This court may impose the following sanctions for gross ignorance of the law or procedure, it being a serious charge:53

a. dismissal from the service with forfeiture of benefits, except accrued leave credits, and disqualification from reinstatement or appointment to any public office, including
government-owned or controlled corporations;54

b. suspension from office without salary and other benefits for more than three (3) but not exceeding six (6) months;55 or

c. A fine of more than P20,000.00 but not exceeding P40,000.00.56

This court does not condone violations of law. Judges have been dismissed from the service for gross ignorance of the law. However, Judge Rojo may have been misled by other
judges practice of notarizing affidavits of cohabitation in Bacolod City and Talisay City. Thus, this court finds suspension from office without salary and other benefits for six (6) months
sufficient sanction.

Trial court judges are advised to strictly comply with the requirements of the law.1wphi1 They should act with caution with respect to affidavits of cohabitation. Similar breach of the
ethical requirements as in this case will be dealt with strictly.

WHEREFORE, Judge Remegio V. Rojo, Presiding Judge of the Municipal Trial Court in Cities, Branch 5, Bacolod City, Negros Occidental is SUSPENDED FROM OFFICE without
salary and other benefits for SIX (6) MONTHS. His suspension is effective upon service on him of a copy of this resolution.

SERVE copies of this resolution to all municipal trial courts in Bacolod City and Talisay City.

SO ORDERED.

16. G.R. No. 182894

April 22, 2014

FE FLORO VALINO, Petitioner,

vs.
ROSARIO D. ADRIANO, FLORANTE D. ADRIANO, RUBEN D. ADRIANO, MARIA TERESA ADRIANO ONGOCO, VICTORIA ADRIANO BAYONA, and LEAH ANTONETTE D.
ADRIANO, Respondents.

DECISION

MENDOZA, J.:

Challenged in this petition is the October 2, 2006 Decision1 and the May 9, 2008 Resolution2 of the Court of Appeals (CA) in CA-G.R. CV No. 61613, which reversed the October 1,
1998 Decision3 of the Regional Trial Court, Branch 77, Quezon City (RTC) which ruled that petitioner Fe Floro Valino (Valino) was entitled to the remains of the decedent.

The Facts:

Atty. Adriano Adriano (Atty. Adriano), a partner in the Pelaez Adriano and Gregorio Law Office, married respondent Rosario Adriano (Rosario) on November 15, 1955. The couple had
two (2) sons, Florante and Ruben Adriano; three (3) daughters, Rosario, Victoria and Maria Teresa; and one (1) adopted daughter, Leah Antonette.

The marriage of Atty. Adriano and Rosario, however, turned sour and they were eventually separated-in-fact. Years later, Atty. Adriano courted Valino, one of his clients, until they
decided to live together as husband and wife. Despite such arrangement, he continued to provide financial support to Rosario and their children (respondents).

In 1992, Atty. Adriano died of acute emphysema. At that time, Rosario was in the United States spending Christmas with her children. As none of the family members was around,
Valino took it upon herself to shoulder the funeral and burial expenses for Atty. Adriano. When Rosario learned about the death of her husband, she immediately called Valino and
requested that she delay the interment for a few days but her request was not heeded. The remains of Atty. Adriano were then interred at the mausoleum of the family of Valino at the
Manila Memorial Park. Respondents were not able to attend the interment.

Claiming that they were deprived of the chance to view the remains of Atty. Adriano before he was buried and that his burial at the Manila Memorial Park was contrary to his wishes,
respondents commenced suit against Valino praying that they be indemnified for actual, moral and exemplary damages and attorneys fees and that the remains of Atty. Adriano be
exhumed and transferred to the family plot at the Holy Cross Memorial Cemetery in Novaliches, Quezon City.

In her defense, Valino countered that Rosario and Atty. Adriano had been separated for more than twenty (20) years before he courted her. Valino claimed that throughout the time they
were together, he had introduced her to his friends and associates as his wife. Although they were living together, Valino admitted that he never forgot his obligation to support the
respondents. She contended that, unlike Rosario, she took good care of Atty. Adriano and paid for all his medical expenses when he got seriously ill. She also claimed that despite
knowing that Atty. Adriano was in a coma and dying, Rosario still left for the United States. According to Valino, it was Atty. Adrianos last wish that his remains be interred in the Valino
family mausoleum at the Manila Memorial Park.

Valino further claimed that she had suffered damages as result of the suit brought by respondents. Thus, she prayed that she be awarded moral and exemplary damages and attorneys
fees.

Decision of the RTC

The RTC dismissed the complaint of respondents for lack of merit as well as the counterclaim of Valino after it found them to have not been sufficiently proven.

The RTC opined that because Valino lived with Atty. Adriano for a very long time, she knew very well that it was his wish to be buried at the Manila Memorial Park. Taking into
consideration the fact that Rosario left for the United States at the time that he was fighting his illness, the trial court concluded that Rosario did not show love and care for him.
Considering also that it was Valino who performed all the duties and responsibilities of a wife, the RTC wrote that it could be reasonably presumed that he wished to be buried in the
Valino family mausoleum.4

In disposing of the case, the RTC noted that the exhumation and the transfer of the body of Atty. Adriano to the Adriano family plot at the Holy Cross Memorial Cemetery in Novaliches,
Quezon City, would not serve any useful purpose and so he should be spared and respected.5 Decision of the CA

On appeal, the CA reversed and set aside the RTC decision and directed Valino to have the remains of Atty. Adriano exhumed at the expense of respondents. It likewise directed
respondents, at their expense, to transfer, transport and inter the remains of the decedent in the family plot at the Holy Cross Memorial Park in Novaliches, Quezon City.

In reaching said determination, the CA explained that Rosario, being the legal wife, was entitled to the custody of the remains of her deceased husband. Citing Article 305 of the New
Civil Code in relation to Article 199 of the Family Code, it was the considered view of the appellate court that the law gave the surviving spouse not only the duty but also the right to
make arrangements for the funeral of her husband. For the CA, Rosario was still entitled to such right on the ground of her subsisting marriage with Atty. Adriano at the time of the
latters death, notwithstanding their 30-year separation in fact.

Like the RTC, however, the CA did not award damages in favor of respondents due to the good intentions shown by Valino in giving the deceased a decent burial when the wife and the
family were in the United States. All other claims for damages were similarly dismissed.

The Sole Issue

The lone legal issue in this petition is who between Rosario and Valino is entitled to the remains of Atty. Adriano.

The Courts Ruling

Article 305 of the Civil Code, in relation to what is now Article 1996 of the Family Code, specifies the persons who have the right and duty to make funeral arrangements for the
deceased. Thus:

Art. 305. The duty and the right to make arrangements for the funeral of a relative shall be in accordance with the order established for support, under Article 294. In case of
descendants of the same degree, or of brothers and sisters, the oldest shall be preferred. In case of ascendants, the paternal shall have a better right. [Emphases supplied]

Art. 199. Whenever two or more persons are obliged to give support, the liability shall devolve upon the following persons in the order herein provided:

(1) The spouse;

(2) The descendants in the nearest degree;

(3) The ascendants in the nearest degree; and

(4) The brothers and sisters. (294a)

[Emphasis supplied]

Further, Article 308 of the Civil Code provides:

Art. 308. No human remains shall be retained, interred, disposed of or exhumed without the consent of the persons mentioned in Articles 294 and 305. [Emphases supplied]

In this connection, Section 1103 of the Revised Administrative Code provides:

Section 1103. Persons charged with the duty of burial. The immediate duty of burying the body of a deceased person, regardless of the ultimate liability for the expense thereof, shall
devolve upon the persons herein below specified:

(a) If the deceased was a married man or woman, the duty of the burial shall devolve upon the surviving spouse if he or she possesses sufficient means to pay the necessary expenses;

x x x x. [Emphases supplied]

From the aforecited provisions, it is undeniable that the law simply confines the right and duty to make funeral arrangements to the members of the family to the exclusion of ones
common law partner. In Tomas Eugenio, Sr. v. Velez,7 a petition for habeas corpus was filed by the brothers and sisters of the late Vitaliana Vargas against her lover, Tomas Eugenio,
Sr., alleging that the latter forcibly took her and confined her in his residence. It appearing that she already died of heart failure due to toxemia of pregnancy, Tomas Eugenio, Sr. sought
the dismissal of the petition for lack of jurisdiction and claimed the right to bury the deceased, as the common-law husband.

In its decision, the Court resolved that the trial court continued to have jurisdiction over the case notwithstanding the death of Vitaliana Vargas. As to the claim of Tomas Eugenio, Sr.
that he should be considered a "spouse" having the right and duty to make funeral arrangements for his common-law wife, the Court ruled:

x x x Indeed, Philippine Law does not recognize common law marriages. A man and woman not legally married who cohabit for many years as husband and wife, who represent
themselves to the public as husband and wife, and who are reputed to be husband and wife in the community where they live may be considered legally married in common law
jurisdictions but not in the Philippines.

While it is true that our laws do not just brush aside the fact that such relationships are present in our society, and that they produce a community of properties and interests which is
governed by law, authority exists in case law to the effect that such form of co-ownership requires that the man and woman living together must not in any way be incapacitated to
contract marriage. In any case, herein petitioner has a subsisting marriage with another woman, a legal impediment which disqualified him from even legally marrying Vitaliana. In
Santero vs. CFI of Cavite, the Court, thru Mr. Justice Paras, interpreting Art. 188 of the Civil Code (Support of Surviving Spouse and Children During Liquidation of Inventoried Property)
stated: "Be it noted, however, that with respect to 'spouse,' the same must be the legitimate 'spouse' (not common-law spouses)."

There is a view that under Article 332 of the Revised Penal Code, the term "spouse" embraces common law relation for purposes of exemption from criminal liability in cases of theft,
swindling and malicious mischief committed or caused mutually by spouses. The Penal Code article, it is said, makes no distinction between a couple whose cohabitation is sanctioned
by a sacrament or legal tie and another who are husband and wife de facto. But this view cannot even apply to the facts of the case at bar. We hold that the provisions of the Civil Code,
unless expressly providing to the contrary as in Article 144, when referring to a "spouse" contemplate a lawfully wedded spouse. Petitioner vis-a-vis Vitaliana was not a lawfully-wedded
spouse to her; in fact, he was not legally capacitated to marry her in her lifetime.8 [Emphases supplied]

As applied to this case, it is clear that the law gives the right and duty to make funeral arrangements to Rosario, she being the surviving legal wife of Atty. Adriano. The fact that she was
living separately from her husband and was in the United States when he died has no controlling significance. To say that Rosario had, in effect, waived or renounced, expressly or
impliedly, her right and duty to make arrangements for the funeral of her deceased husband is baseless. The right and duty to make funeral arrangements, like any other right, will not
be considered as having been waived or renounced, except upon clear and satisfactory proof of conduct indicative of a free and voluntary intent to that end.9 While there was
disaffection between Atty. Adriano and Rosario and their children when he was still alive, the Court also recognizes that human compassion, more often than not, opens the door to
mercy and forgiveness once a family member joins his Creator. Notably, it is an undisputed fact that the respondents wasted no time in making frantic pleas to Valino for the delay of the
interment for a few days so they could attend the service and view the remains of the deceased. As soon as they came to know about Atty. Adrianos death in the morning of December
19, 1992 (December 20, 1992 in the Philippines), the respondents immediately contacted Valino and the Arlington Memorial Chapel to express their request, but to no avail.

Valino insists that the expressed wishes of the deceased should nevertheless prevail pursuant to Article 307 of the Civil Code. Valinos own testimony that it was Atty. Adrianos wish to
be buried in their family plot is being relied upon heavily. It should be noted, however, that other than Valinos claim that Atty. Adriano wished to be buried at the Manila Memorial Park,
no other evidence was presented to corroborate such claim. Considering that Rosario equally claims that Atty. Adriano wished to be buried in the Adriano family plot in Novaliches, it
becomes apparent that the supposed burial wish of Atty. Adriano was unclear and undefinite. Considering this ambiguity as to the true wishes of the deceased, it is the law that supplies
the presumption as to his intent. No presumption can be said to have been created in Valinos favor, solely on account of a long-time relationship with Atty. Adriano.

Moreover, it cannot be surmised that just because Rosario was unavailable to bury her husband when she died, she had already renounced her right to do so. Verily, in the same vein
that the right and duty to make funeral arrangements will not be considered as having been waived or renounced, the right to deprive a legitimate spouse of her legal right to bury the
remains of her deceased husband should not be readily presumed to have been exercised, except upon clear and satisfactory proof of conduct indicative of a free and voluntary intent
of the deceased to that end. Should there be any doubt as to the true intent of the deceased, the law favors the legitimate family. Here, Rosarios keenness to exercise the rights and
obligations accorded to the legal wife was even bolstered by the fact that she was joined by the children in this case.

Even assuming, ex gratia argumenti, that Atty. Adriano truly wished to be buried in the Valino family plot at the Manila Memorial Park, the result remains the same. Article 307 of the
Civil Code provides:

Art. 307. The funeral shall be in accordance with the expressed wishes of the deceased. In the absence of such expression, his religious beliefs or affiliation shall determine the funeral
rites. In case of doubt, the form of the funeral shall be decided upon by the person obliged to make arrangements for the same, after consulting the other members of the family.

From its terms, it is apparent that Article 307 simply seeks to prescribe the "form of the funeral rites" that should govern in the burial of the deceased. As thoroughly explained earlier,
the right and duty to make funeral arrangements reside in the persons specified in Article 305 in relation to Article 199 of the Family Code. Even if Article 307 were to be interpreted to
include the place of burial among those on which the wishes of the deceased shall be followed, Dr. Arturo M. Tolentino (Dr. Tolentino), an eminent authority on civil law, commented that
it is generally recognized that any inferences as to the wishes of the deceased should be established by some form of testamentary disposition.10 As Article 307 itself provides, the
wishes of the deceased must be expressly provided. It cannot be inferred lightly, such as from the circumstance that Atty. Adriano spent his last remaining days with Valino. It bears
stressing once more that other than Valinos claim that Atty. Adriano wished to be buried at the Valino family plot, no other evidence was presented to corroborate it.

At any rate, it should be remembered that the wishes of the decedent with respect to his funeral are not absolute. As Dr. Tolentino further wrote:

The dispositions or wishes of the deceased in relation to his funeral, must not be contrary to law. They must not violate the legal and reglamentary provisions concerning funerals and
the disposition of the remains, whether as regards the time and manner of disposition, or the place of burial, or the ceremony to be observed.11 [Emphases supplied]

In this case, the wishes of the deceased with respect to his funeral are limited by Article 305 of the Civil Code in relation to Article 199 of the Family Code, and subject the same to those
charged with the right and duty to make the proper arrangements to bury the remains of their loved-one. As aptly explained by the appellate court in its disquisition:

The testimony of defendant-appellee Fe Floro Valino that it was the oral wish of Atty. Adriano Adriano that he be interred at the Floro familys mausoleum at the Manila Memorial Park,
must bend to the provisions of the law. Even assuming arguendo that it was the express wish of the deceased to be interred at the Manila Memorial Park, still, the law grants the duty
and the right to decide what to do with the remains to the wife, in this case, plaintiff-appellant Rosario D. Adriano, as the surviving spouse, and not to defendant-appellee Fe Floro
Valino, who is not even in the list of those legally preferred, despite the fact that her intentions may have been very commendable. The law does not even consider the emotional fact
that husband and wife had, in this case at bench, been separated-in-fact and had been living apart for more than 30 years.12

As for Valinos contention that there is no point in exhuming and transferring the remains of Atty. Adriano, it should be said that the burial of his remains in a place other than the
Adriano family plot in Novaliches runs counter to the wishes of his family. It does not only violate their right provided by law, but it also disrespects the family because the remains of the
patriarch are buried in the family plot of his live-in partner.

It is generally recognized that the corpse of an individual is outside the commerce of man. However, the law recognizes that a certain right of possession over the corpse exists, for the
purpose of a decent burial, and for the exclusion of the intrusion by third persons who have no legitimate interest in it. This quasi-property right, arising out of the duty of those obligated
by law to bury their dead, also authorizes them to take possession of the dead body for purposes of burial to have it remain in its final resting place, or to even transfer it to a proper
place where the memory of the dead may receive the respect of the living. This is a family right. There can be no doubt that persons having this right may recover the corpse from third
persons.13

All this notwithstanding, the Court finds laudable the acts of Valino in taking care of Atty. Adriano during his final moments and giving him a proper burial. For her sacrifices, it would
indeed be unkind to assess actual or moral damages against her. As aptly explained by the CA:

The trial court found that there was good faith on the part of defendant-appellee Fe Floro Valino, who, having lived with Atty. Adriano after he was separated in fact from his wife,
lovingly and caringly took care of the well-being of Atty. Adriano Adriano while he was alive and even took care of his remains when he had died.

On the issue of damages, plaintiffs-appellants are not entitled to actual damages. Defendant-appellee Fe Floro Valino had all the good intentions in giving the remains of Atty. Adriano a
decent burial when the wife and family were all in the United States and could not attend to his burial. Actual damages are those awarded in satisfaction of, or in recompense for, loss or
injury sustained. To be recoverable, they must not only be capable of proof but must actually be proven with a reasonable degree of certainty. In this case at bench, there was no iota of
evidence presented to justify award of actual damages.

Plaintiffs-appellants are not also entitled to moral and exemplary damages.1wphi1 Moral damages may be recovered only if the plaintiff is able to satisfactorily prove the existence of
the factual basis for the damages and its causal connection with the acts complained of because moral damages although incapable of pecuniary estimation are designed not to impose
a penalty but to compensate for injury sustained and actual damages suffered. No injury was caused to plaintiffs-appellants, nor was any intended by anyone in this case. Exemplary
damages, on the other hand, may only be awarded if claimant is able to establish his right to moral, temperate, liquidated or compensatory damages. Unfortunately, neither of the
requirements to sustain an award for either of these damages would appear to have been adequately established by plaintiffs-appellants.

As regards the award of attorney's fees, it is an accepted doctrine that the award thereof as an item of damages is the exception rather than the rule, and counsel's fees are not to be
awarded every time a party wins a suit. The power of the court to award attorney's fees under Article 2208 of the New Civil Code demands factual, legal and equitable justification,
without which the award is a conclusion without a premise, its basis being improperly left to speculation and conjecture. In this case, we have searched but found nothing in plaintiffsappellants' suit that justifies the award of attorney's fees.14

Finally, it should be said that controversies as to who should make arrangements for the funeral of a deceased have often aggravated the bereavement of the family and disturbed the
proper solemnity which should prevail at every funeral. It is for the purpose of preventing such controversies that the Code Commission saw it best to include the provisions on
"Funerals."15

WHEREFORE, the petition is DENIED.

SO ORDERED.

17. G.R. No. 174727

August 12, 2013

ANTIPOLO INING (DECEASED), SURVIVED BY MANUEL VILLANUEVA, TEODORA VILLANUEVA-FRANCISCO, CAMILO FRANCISCO, ADOLFO FRANCISCO, LUCIMO
FRANCISCO, JR., MILAGROS FRANCISCO,* CELEDONIO FRANCISCO, HERMINIGILDO FRANCISCO; RAMON TRESVALLES, ROBERTO TAJONERA, NATIVIDAD ININGIBEA (DECEASED) SURVIVED BY EDILBERTO IBEA, JOSEFA IBEA, MARTHA IBEA, CARMEN IBEA, AMPARO IBEA-FERNANDEZ, HENRY RUIZ, EUGENIO RUIZ AND
PASTOR RUIZ; DOLORES INING-RIMON (DECEASED) SURVIVED BY JESUS RIMON, CESARIA RIMON GONZALES AND REMEDIOS RIMON CORDERO; AND PEDRO INING
(DECEASED) SURVIVED BY ELISA TAN INING (WIFE) AND PEDRO INING, JR., PETITIONERS,
vs.
LEONARDO R. VEGA, SUBSTITUTED BY LOURDES VEGA, RESTONILO I. VEGA, CRISPULO M. VEGA, MILBUENA VEGA-RESTITUTO, AND LENARD
VEGA, RESPONDENTS.

DECISION

DEL CASTILLO, J.:

One who is merely related by affinity to the decedent does not inherit from the latter and cannot become a co-owner of the decedents property. Consequently, he cannot effect a
repudiation of the co-ownership of the estate that was formed among the decedents heirs.

Assailed in this Petition for Review on Certiorari1 are the March 14, 2006 Decision2 of the Court of Appeals (CA) in CA-G.R. CV No. 74687 and its September 7, 2006
Resolution3 denying petitioners Motion for Reconsideration.4

Factual Antecedents

Leon Roldan (Leon), married to Rafaela Menez (Rafaela), is the owner of a 3,120-square meter parcel of land (subject property) in Kalibo, Aklan covered by Original Certificate of Title
No. (24071) RO-6305 (OCT RO-630). Leon and Rafaela died without issue. Leon was survived by his siblings Romana Roldan (Romana) and Gregoria Roldan Ining (Gregoria), who
are now both deceased.

Romana was survived by her daughter Anunciacion Vega and grandson, herein respondent Leonardo R. Vega (Leonardo) (also both deceased). Leonardo in turn is survived by his wife
Lourdes and children Restonilo I. Vega, Crispulo M. Vega, Milbuena Vega-Restituto and Lenard Vega, the substituted respondents.

Gregoria, on the other hand, was survived by her six children: petitioners Natividad Ining-Ibea (Natividad), Dolores Ining-Rimon (Dolores), Antipolo, and Pedro; Jose; and Amando.
Natividad is survived by Edilberto Ibea, Josefa Ibea, Martha Ibea, Carmen Ibea, Amparo Ibea-Fernandez, Henry Ruiz and Pastor Ruiz. Dolores is survived by Jesus Rimon, Cesaria
Rimon Gonzales and Remedios Rimon Cordero. Antipolo is survived by Manuel Villanueva, daughter Teodora Villanueva-Francisco (Teodora), Camilo Francisco (Camilo), Adolfo
Francisco (Adolfo), Lucimo Francisco, Jr. (Lucimo Jr.), Milagros Francisco, Celedonio Francisco, and Herminigildo Francisco (Herminigildo). Pedro is survived by his wife, Elisa Tan
Ining and Pedro Ining, Jr. Amando died without issue. As for Jose, it is not clear from the records if he was made party to the proceedings, or if he is alive at all.

In short, herein petitioners, except for Ramon Tresvalles (Tresvalles) and Roberto Tajonera (Tajonera), are Gregorias grandchildren or spouses thereof (Gregorias heirs).

In 1997, acting on the claim that one-half of subject property belonged to him as Romanas surviving heir, Leonardo filed with the Regional Trial Court (RTC) of Kalibo, Aklan Civil Case
No. 52756 for partition, recovery of ownership and possession, with damages, against Gregorias heirs. In his Amended Complaint,7 Leonardo alleged that on several occasions, he
demanded the partition of the property but Gregorias heirs refused to heed his demands; that the matter reached the level of the Lupon Tagapamayapa, which issued a certification to
file a court action sometime in 1980; that Gregorias heirs claimed sole ownership of the property; that portions of the property were sold to Tresvalles and Tajonera, which portions
must be collated and included as part of the portion to be awarded to Gregorias heirs; that in 1979, Lucimo Francisco, Sr. (Lucimo Sr.), husband of herein petitioner Teodora, illegally
claimed absolute ownership of the property and transferred in his name the tax declaration covering the property; that from 1988, Lucimo Sr. and Teodora have deprived him
(Leonardo) of the fruits of the property estimated atP1,000.00 per year; that as a result, he incurred expenses by way of attorneys fees and litigation costs. Leonardo thus prayed that
he be declared the owner of half of the subject property; that the same be partitioned after collation and determination of the portion to which he is entitled; that Gregorias heirs be
ordered to execute the necessary documents or agreements; and that he (Leonardo) be awarded actual damages in the amount of P1,000.00 per year from 1988, attorneys fees
of P50,000.00, and lawyers appearance fees of P500.00 per hearing.

In their Answer8 with counterclaim, Teodora, Camilo, Adolfo, Lucimo Jr. and Herminigildo claimed that Leonardo had no cause of action against them; that they have become the sole
owners of the subject property through Lucimo Sr. who acquired the same in good faith by sale from Juan Enriquez (Enriquez), who in turn acquired the same from Leon, and Leonardo
was aware of this fact; that they were in continuous, actual, adverse, notorious and exclusive possession of the property with a just title; that they have been paying the taxes on the
property; that Leonardos claim is barred by estoppel and laches; and that they have suffered damages and were forced to litigate as a result of Leonardos malicious suit. They prayed
that Civil Case No. 5275 be dismissed; that Leonardo be declared to be without any right to the property; that Leonardo be ordered to surrender the certificate of title to the property;
and that they be awarded P20,000.00 as moral damages, P10,000.00 as temperate and nominal damages, P20,000.00 as attorneys fees, and double costs.

The other Gregoria heirs, as well as Tresvalles and Tajonera were declared in default.9

As agreed during pre-trial, the trial court commissioned Geodetic Engineer Rafael M. Escabarte to identify the metes and bounds of the property.10 The resulting Commissioners
Report and Sketch,11 as well as the Supplementary Commissioners Report,12 were duly approved by the parties. The parties then submitted the following issues for resolution of the
trial court:

Whether Leonardo is entitled to a share in Leons estate;

Whether Leon sold the subject property to Lucimo Sr.; and

Whether Leonardos claim has prescribed, or that he is barred by estoppel or laches.13

In the meantime, Leonardo passed away and was duly substituted by his heirs, the respondents herein.14

During the course of the proceedings, the following additional relevant facts came to light:

1. In 1995, Leonardo filed against petitioners Civil Case No. 4983 for partition with the RTC Kalibo, but the case was dismissed and referred to the Kalibo Municipal Trial
Court (MTC), where the case was docketed as Civil Case No. 1366. However, on March 4, 1997, the MTC dismissed Civil Case No. 1366 for lack of jurisdiction and
declared that only the RTC can take cognizance of the partition case;15

2. The property was allegedly sold by Leon to Enriquez through an unnotarized document dated April 4, 1943.16 Enriquez in turn allegedly sold the property to Lucimo Sr.
on November 25, 1943 via another private sale document;17

3. Petitioners were in sole possession of the property for more than 30 years, while Leonardo acquired custody of OCT RO-630;18

4. On February 9, 1979, Lucimo Sr. executed an Affidavit of Ownership of Land19 claiming sole ownership of the property which he utilized to secure in his name Tax
Declaration No. 16414 (TD 16414) over the property and to cancel Tax Declaration No. 20102 in Leons name;20

5. Lucimo Sr. died in 1991; and

6. The property was partitioned among the petitioners, to the exclusion of Leonardo.21

Ruling of the Regional Trial Court

On November 19, 2001, the trial court rendered a Decision,22 which decreed as follows:

WHEREFORE, premises considered, judgment is hereby rendered:

Dismissing the complaint on the ground that plaintiffs right of action has long prescribed under Article 1141 of the New Civil Code;

Declaring Lot 1786 covered by OCT No. RO-630 (24071) to be the common property of the heirs of Gregoria Roldan Ining and by virtue whereof, OCT No. RO-630 (24071) is ordered
cancelled and the Register of Deeds of the Province of Aklan is directed to issue a transfer certificate of title to the heirs of Natividad Ining, one-fourth (1/4) share; Heirs of Dolores Ining,
one-fourth (1/4) share; Heirs of Antipolo Ining, one-fourth (1/4) share; and Heirs of Pedro Ining, one-fourth (1/4) share.

For lack of sufficient evidence, the counterclaim is ordered dismissed.

With cost against the plaintiffs.

SO ORDERED.23

The trial court found the April 4, 1943 and November 25, 1943 deeds of sale to be spurious. It concluded that Leon never sold the property to Enriquez, and in turn, Enriquez never sold
the property to Lucimo Sr., hence, the subject property remained part of Leons estate at the time of his death in 1962. Leons siblings, Romana and Gregoria, thus inherited the subject
property in equal shares. Leonardo and the respondents are entitled to Romanas share as the latters successors.

However, the trial court held that Leonardo had only 30 years from Leons death in 1962 or up to 1992 within which to file the partition case. Since Leonardo instituted the partition
suit only in 1997, the same was already barred by prescription. It held that under Article 1141 of the Civil Code,24 an action for partition and recovery of ownership and possession of a
parcel of land is a real action over immovable property which prescribes in 30 years. In addition, the trial court held that for his long inaction, Leonardo was guilty of laches as well.
Consequently, the property should go to Gregorias heirs exclusively.

Respondents moved for reconsideration25 but the same was denied by the RTC in its February 7, 2002 Order.26

Ruling of the Court of Appeals

Only respondents interposed an appeal with the CA. Docketed as CA-G.R. CV No. 74687, the appeal questioned the propriety of the trial courts dismissal of Civil Case No. 5275, its
application of Article 1141, and the award of the property to Gregorias heirs exclusively.

On March 14, 2006, the CA issued the questioned Decision,27 which contained the following decretal portion:

IN LIGHT OF ALL THE FOREGOING, this appeal is GRANTED. The decision of the Regional Trial Court, Br. 8, Kalibo, Aklan in Civil Case No. 5275 is REVERSED and SET ASIDE. In
lieu thereof, judgment is rendered as follows:

1. Declaring 1/2 portion of Lot 1786 as the share of the plaintiffs as successors-in-interest of Romana Roldan;

2. Declaring 1/2 portion of Lot 1786 as the share of the defendants as successors-in-interest of Gregoria Roldan Ining;

3. Ordering the defendants to deliver the possession of the portion described in paragraphs 8 and 9 of the Commissioners Report (Supplementary) to the herein plaintiffs;

4. Ordering the cancellation of OCT No. RO-630 (24071) in the name of Leon Roldan and the Register of Deeds of Aklan is directed to issue transfer certificates of title to
the plaintiffs in accordance with paragraphs 8 and 9 of the sketch plan as embodied in the Commissioners Report (Supplementary) and the remaining portion thereof be
adjudged to the defendants.

Other claims and counterclaims are dismissed.

Costs against the defendants-appellees.

SO ORDERED.28

The CA held that the trial courts declaration of nullity of the April 4, 1943 and November 25, 1943 deeds of sale in favor of Enriquez and Lucimo Sr., respectively, became final and was
settled by petitioners failure to appeal the same. Proceeding from the premise that no valid prior disposition of the property was made by its owner Leon and that the property which

remained part of his estate at the time of his death passed on by succession to his two siblings, Romana and Gregoria, which thus makes the parties herein who are Romanas and
Gregorias heirs co-owners of the property in equal shares, the appellate court held that only the issues of prescription and laches were needed to be resolved.

The CA did not agree with the trial courts pronouncement that Leonardos action for partition was barred by prescription. The CA declared that prescription began to run not from Leons
death in 1962, but from Lucimo Sr.s execution of the Affidavit of Ownership of Land in 1979, which amounted to a repudiation of his co-ownership of the property with Leonardo.
Applying the fifth paragraph of Article 494 of the Civil Code, which provides that "[n]o prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as
he expressly or impliedly recognizes the co-ownership," the CA held that it was only when Lucimo Sr. executed the Affidavit of Ownership of Land in 1979 and obtained a new tax
declaration over the property (TD 16414) solely in his name that a repudiation of his co-ownership with Leonardo was made, which repudiation effectively commenced the running of the
30-year prescriptive period under Article 1141.

The CA did not consider Lucimo Sr.s sole possession of the property for more than 30 years to the exclusion of Leonardo and the respondents as a valid repudiation of the coownership either, stating that his exclusive possession of the property and appropriation of its fruits even his continuous payment of the taxes thereon while adverse as against
strangers, may not be deemed so as against Leonardo in the absence of clear and conclusive evidence to the effect that the latter was ousted or deprived of his rights as co-owner with
the intention of assuming exclusive ownership over the property, and absent a showing that this was effectively made known to Leonardo. Citing Bargayo v. Camumot29 and Segura v.
Segura,30 the appellate court held that as a rule, possession by a co-owner will not be presumed to be adverse to the other co-owners but will be held to benefit all, and that a co-owner
or co-heir is in possession of an inheritance pro-indiviso for himself and in representation of his co-owners or co-heirs if he administers or takes care of the rest thereof with the
obligation to deliver the same to his co-owners or co-heirs, as is the case of a depositary, lessee or trustee.

The CA added that the payment of taxes by Lucimo Sr. and the issuance of a new tax declaration in his name do not prove ownership; they merely indicate a claim of ownership.
Moreover, petitioners act of partitioning the property among themselves to the exclusion of Leonardo cannot affect the latter; nor may it be considered a repudiation of the co-ownership
as it has not been shown that the partition was made known to Leonardo.

The CA held further that the principle of laches cannot apply as against Leonardo and the respondents. It held that laches is controlled by equitable considerations and it cannot be
used to defeat justice or to perpetuate fraud; it cannot be utilized to deprive the respondents of their rightful inheritance.

On the basis of the above pronouncements, the CA granted respondents prayer for partition, directing that the manner of partitioning the property shall be governed by the
Commissioners Report and Sketch and the Supplementary Commissioners Report which the parties did not contest.

Petitioners filed their Motion for Reconsideration31 which the CA denied in its assailed September 7, 2006 Resolution.32 Hence, the present Petition.

Issues

Petitioners raise the following arguments:

THE APPELLATE COURT COMMITTED GRAVE ABUSE OF DISCRETION IN REVERSING THE DECISION OF THE TRIAL COURT ON THE GROUND THAT
LUCIMO FRANCISCO REPUDIATED THE CO-OWNERSHIP ONLY ON FEBRUARY 9, 1979.

II

THE APPELLATE COURT ERRED IN NOT UPHOLDING THE DECISION OF THE TRIAL COURT DISMISSING THE COMPLAINT ON THE GROUND OF
PRESCRIPTION AND LACHES.33

Petitioners Arguments

Petitioners insist in their Petition and Reply34 that Lucimo Sr.s purchase of the property in 1943 and his possession thereof amounted to a repudiation of the co-ownership, and that
Leonardos admission and acknowledgment of Lucimo Sr.s possession for such length of time operated to bestow upon petitioners as Lucimo Sr.s successors-in-interest the
benefits of acquisitive prescription which proceeded from the repudiation.

Petitioners contend that Leonardos inaction from Lucimo Sr.s taking possession in 1943, up to 1995, when Leonardo filed Civil Case No. 4983 for partition with the RTC Kalibo
amounted to laches or neglect. They add that during the proceedings before the Lupon Tagapamayapa in 1980, Leonardo was informed of Lucimo Sr.s purchase of the property in
1943; this notwithstanding, Leonardo did not take action then against Lucimo Sr. and did so only in 1995, when he filed Civil Case No. 4983 which was eventually dismissed and
referred to the MTC. They argue that, all this time, Leonardo did nothing while Lucimo Sr. occupied the property and claimed all its fruits for himself.

Respondents Arguments

Respondents, on the other hand, argue in their Comment35 that

For purposes of clarity, if [sic] is respectfully submitted that eighteen (18) legible copies has [sic] not been filed in this case for consideration in banc [sic] and nine (9) copies in cases
heard before a division in that [sic] all copies of pleadings served to the offices concern [sic] where said order [sic] was issued were not furnished two (2) copies each in violation to [sic]
the adverse parties [sic] to the clerk of court, Regional Trial Court, Branch 8, Kalibo, Aklan, Philippines; to the Honorable Court of Appeals so that No [sic] action shall be taken on such
pleadings, briefs, memoranda, motions, and other papers as fail [sic] to comply with the requisites set out in this paragraph.

The foregoing is confirmed by affidavit of MERIDON F. OLANDESCA, the law secretary of the Petitioner [sic] who sent [sic] by Registered mail to Court of Appeals, Twentieth Division,
Cebu City; to Counsel for Respondent [sic] and to the Clerk of Court Supreme Court Manila [sic].

These will show that Petitioner has [sic] violated all the requirements of furnishing two (2) copies each concerned party [sic] under the Rule of Courts [sic].36

Our Ruling

The Court denies the Petition.

The finding that Leon did not sell the property to Lucimo Sr. had long been settled and had become final for failure of petitioners to appeal. Thus, the property remained part of Leons
estate.

One issue submitted for resolution by the parties to the trial court is whether Leon sold the property to Lucimo Sr.1wphi1The trial court, examining the two deeds of sale executed in
favor of Enriquez and Lucimo Sr., found them to be spurious. It then concluded that no such sale from Leon to Lucimo Sr. ever took place. Despite this finding, petitioners did not
appeal. Consequently, any doubts regarding this matter should be considered settled. Thus, petitioners insistence on Lucimo Sr.s 1943 purchase of the property to reinforce their claim
over the property must be ignored. Since no transfer from Leon to Lucimo Sr. took place, the subject property clearly remained part of Leons estate upon his passing in 1962.

Leon died without issue; his heirs are his siblings Romana and Gregoria.

Since Leon died without issue, his heirs are his siblings, Romana and Gregoria, who thus inherited the property in equal shares. In turn, Romanas and Gregorias heirs the parties
herein became entitled to the property upon the sisters passing. Under Article 777 of the Civil Code, the rights to the succession are transmitted from the moment of death.

Gregorias and Romanas heirs are co-owners of the subject property.

Thus, having succeeded to the property as heirs of Gregoria and Romana, petitioners and respondents became co-owners thereof. As co-owners, they may use the property owned in
common, provided they do so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of the co-ownership or prevent the other co-owners
from using it according to their rights.37 They have the full ownership of their parts and of the fruits and benefits pertaining thereto, and may alienate, assign or mortgage them, and
even substitute another person in their enjoyment, except when personal rights are involved.38 Each co-owner may demand at any time the partition of the thing owned in common,
insofar as his share is concerned.39 Finally, no prescription shall run in favor of one of the co-heirs against the others so long as he expressly or impliedly recognizes the coownership.40

For prescription to set in, the repudiation must be done by a co-owner.

Time and again, it has been held that "a co-owner cannot acquire by prescription the share of the other co-owners, absent any clear repudiation of the co-ownership. In order that the
title may prescribe in favor of a co-owner, the following requisites must concur: (1) the co-owner has performed unequivocal acts of repudiation amounting to an ouster of the other coowners; (2) such positive acts of repudiation have been made known to the other co-owners; and (3) the evidence thereof is clear and convincing."41

From the foregoing pronouncements, it is clear that the trial court erred in reckoning the prescriptive period within which Leonardo may seek partition from the death of Leon in 1962.
Article 1141 and Article 494 (fifth paragraph) provide that prescription shall begin to run in favor of a co-owner and against the other co-owners only from the time he positively
renounces the co-ownership and makes known his repudiation to the other co-owners.

Lucimo Sr. challenged Leonardos co-ownership of the property only sometime in 1979 and 1980, when the former executed the Affidavit of Ownership of Land, obtained a new tax
declaration exclusively in his name, and informed the latter before the Lupon Tagapamayapa of his 1943 purchase of the property. These apparent acts of repudiation were followed
later on by Lucimo Sr.s act of withholding Leonardos share in the fruits of the property, beginning in 1988, as Leonardo himself claims in his Amended Complaint. Considering these
facts, the CA held that prescription began to run against Leonardo only in 1979 or even in 1980 when it has been made sufficiently clear to him that Lucimo Sr. has renounced the
co-ownership and has claimed sole ownership over the property. The CA thus concluded that the filing of Civil Case No. 5275 in 1997, or just under 20 years counted from 1979, is
clearly within the period prescribed under Article 1141.

What escaped the trial and appellate courts notice, however, is that while it may be argued that Lucimo Sr. performed acts that may be characterized as a repudiation of the coownership, the fact is, he is not a co-owner of the property. Indeed, he is not an heir of Gregoria; he is merely Antipolos son-in-law, being married to Antipolos daughter
Teodora.42 Under the Family Code, family relations, which is the primary basis for succession, exclude relations by affinity.

Art. 150. Family relations include those:

(1) Between husband and wife;

(2) Between parents and children;

(3) Among other ascendants and descendants; and

(4) Among brothers and sisters, whether of the full or half blood.

In point of law, therefore, Lucimo Sr. is not a co-owner of the property; Teodora is. Consequently, he cannot validly effect a repudiation of the co-ownership, which he was never part of.
For this reason, prescription did not run adversely against Leonardo, and his right to seek a partition of the property has not been lost.

Likewise, petitioners argument that Leonardos admission and acknowledgment in his pleadings that Lucimo Sr. was in possession of the property since 1943 should be taken
against him, is unavailing. In 1943, Leon remained the rightful owner of the land, and Lucimo Sr. knew this very well, being married to Teodora, daughter of Antipolo, a nephew of Leon.
More significantly, the property, which is registered under the Torrens system and covered by OCT RO-630, is in Leons name. Leons ownership ceased only in 1962, upon his death
when the property passed on to his heirs by operation of law.

In fine, since none of the co-owners made a valid repudiation of the existing co-ownership, Leonardo could seek partition of the property at any time.

WHEREFORE, the Petition is DENIED. The assailed March 14, 2006 Decision and the September 7, 2006 Resolution of the Court of Appeals in CA-G.R. CV No. 74687are AFFIRMED.

SO ORDERED.

18. G.R. No. 151334

February 13, 2013

CAROLINA (CARLINA) VDA. DE FIGURACION, HEIRS OF ELENA FIGURACION-ANCHETA, namely: LEONCIO ANCHETA, JR., and ROMULO ANCHETA, HEIRS OF HILARIA
A. FIGURACION, namely: FELIPA FIGURACION-MANUEL, MARY FIGURACION-GINEZ, and EMILIA FIGURACION-GERILLA, AND HEIRS OF QUINTIN FIGURACION, namely:
LINDA M. FIGURACION, LEANDRO M. FIGURACION, II, and ALLAN M. FIGURACION, Petitioners,
vs.
EMILIA FIGURACION-GERILLA, Respondent.

DECISION

REYES, J.:

At bar is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Court, assailing the Decision2 dated December 11, 2001 of the Court of Appeals (CA) in CA-G.R. CV No.
58290, which reversed and set aside the Decision3 dated June 26, 1997 of the Regional Trial Court (RTC) of Urdaneta, Pangasinan, Branch 49. The RTC decision (1) dismissed
respondent Emilia Figuracion-Gerillas (Emilia) complaint for partition, annulment of documents, reconveyance, quieting of title and damages, and (2) annulled the Affidavit of SelfAdjudicationexecuted by petitioner Carolina (Carlina) Vda. De Figuracion (Carolina).

The Facts

The parties are the heirs of Leandro Figuracion (Leandro) who died intestate in May 1958. Petitioner Carolina is the surviving spouse. The other petitioners Elena Figuracion-Ancheta,
Hilaria A. Figuracion (Hilaria), Felipa Figuracion-Manuel (Felipa), Quintin Figuracion, and Mary Figuracion-Ginez and respondent Emilia were Carolina and Leandros children.4

Subject of the dispute are two parcels of land both situated in Urdaneta, Pangasinan, which were acquired by Leandro during his lifetime. These properties were: (1) Lot No. 2299 with a
land area of 7,547 square meters originally covered by Transfer Certificate of Title (TCT) No. 4221-P;5 and (2) Lot No. 705 measuring 2,900 square meters and covered by TCT No.
4220-P. Both lands were registered in the name of "Leandro Figuracion married to Carolina Adviento". Leandro executed a Deed of Quitclaim over the above real properties in favor of
his six (6) children on August 23, 1955. Their shares, however, were not delineated with particularity because spouses Leandro and Carolina reserved the lots and its fruits for their
expenses.

Also involved in the controversy is Lot No. 707 of the Cadastral Survey of Urdaneta, Pangasinan, with an area of 3,164 square meters originally owned by Eulalio Adviento (Eulalio),
covered by Original Certificate of Title (OCT) No. 15867 issued in his name on August 21, 1917. Eulalio begot Agripina Adviento (Agripina) with his first wife Marcela Estioko (Marcela),
whom Eulalio survived. When he remarried, Eulalio had another daughter, herein petitioner Carolina, with his second wife, Faustina Escabesa (Faustina).6

On November 28, 1961, Agripina7 executed a Deed of Quitclaim8 over the eastern half of Lot No. 707 in favor of her niece, herein respondent Emilia.

Soon thereafter or on December 11, 1962, petitioner Carolina executed an Affidavit of Self-Adjudication9adjudicating unto herself the entire Lot No. 707 as the sole and exclusive heir of
her deceased parents, Eulalio and Faustina.10 On the same date, Carolina also executed a Deed of Absolute Sale11 over Lot No. 707 in favor of petitioners Hilaria and Felipa, who in
turn immediately caused the cancellation of OCT No. 15867 and the issuance of TCT No. 42244 in their names.12

In 1971, Emilia and her family went to the United States and returned to the Philippines only in 1981. Upon her return and relying on the Deed of Quitclaim, she built a house on the
eastern half of Lot No. 707.13

The legal debacle of the Figuracions started in 1994 when Hilaria and her agents threatened to demolish the house of Emilia who, in retaliation, was prompted to seek the partition of
Lot No. 707 as well as Lot Nos. 2299 and 705. The matter was initially brought before the Katarungang Pambarangay, but no amicable settlement was reached by the parties.14 On
May 23, 1994, respondent Emilia instituted the herein Complaint15 for the partition of Lot Nos. 2299, 705 and 707, annulment of the Affidavit of Self- Adjudication, Deed of Absolute
Sale and TCT No. 42244, reconveyance of eastern half portion of Lot No. 707, quieting of title and damages.

In opposition, the petitioners averred the following special and affirmative defenses: (1) the respondents cause of action had long prescribed and that she is guilty of laches hence, now
estopped from bringing the suit; (2) TCT No. 42244 in the name of Felipa and Hilaria have already attained indefeasibility and conclusiveness as to the true owners of Lot No. 707; and

(3) an action for partition is no longer tenable because Felipa and Hilaria have already acquired rights adverse to that claimed by respondent Emilia and the same amount to a
repudiation of the alleged co-ownership.16

During pre-trial conference, the issues were simplified into: (1) whether or not Lot Nos. 2299 and 705 are the exclusive properties of Leandro; and (2) whether or not respondent Emilia
is the owner of the eastern half of Lot No. 707.17

On the basis of the evidence adduced by the parties, the RTC rendered its Decision dated June 26, 1997 disposing as follows:

WHEREFORE, premises considered, the complaint for partition, reconveyance, quieting of title and damages is hereby ordered dismissed whereas the affidavit of self-adjudication[,]
deed of sale and the transfer certificate of title involving Lot 707 are hereby declared null and void.

No costs.

SO ORDERED.18

The RTC ruled that a partition of Lot Nos. 2299 and 705 will be premature since their ownership is yet to be transmitted from Leandro to his heirs whose respective shares thereto must
still be determined in estate settlement proceedings. Anent Lot No. 707, the RTC held that petitioner Carolina transferred only her one-half () share to Felipa and Hilaria and any
conveyance of the other half pertaining to Agripina was void. While the RTC nullified theAffidavit of Self-Adjudication, Deed of Absolute Sale and TCT No. 42244, it refused to adjudicate
the ownership of the lots eastern half portion in favor of respondent Emilia since a settlement of the estate of Eulalio is yet to be undertaken.19

Respondent Emilia appealed to the CA, which, in its Decision dated December 11, 2001, ruled that the RTC erred in refusing to partition Lot No. 707. The CA explained that there is no
necessity for placing Lot No. 707 under judicial administration since Carolina had long sold her pro indiviso share to Felipa and Hilaria. Thus, when Carolina sold the entire Lot No.
707 on December 11, 1962 as her own, the sale affected only her share and not that belonging to her co-owner, Agripina. The proper action in such case is not the nullification of the
sale, or for the recovery of possession of the property owned in common from the third person, but for a division or partition of the entire lot. Such partition should result in segregating
the portion belonging to the seller and its delivery to the buyer.

The CA, however, agreed with the RTC that a partition of Lot Nos. 2299 and 705 is indeed premature considering that there is a pending legal controversy with respect to Lot No. 705
and the accounting of the income from Lot No. 2299 and of the expenses for the last illness and burial of Leandro and Carolina, for which the lots appear to have been intended.

Accordingly, the decretal portion of the CA decision reads:

WHEREFORE, premises considered, the present appeal is hereby GRANTED and the decision appealed from in Civil Case No. U-5826 is hereby VACATED and SET ASIDE. A new
judgment is hereby rendered declaring Lot No. 707 covered by TCT No. 42244 to be owned by appellant Emilia Figuracion-Gerilla [herein respondent], pro indiviso share, appellee
Felipa Figuracion [herein petitioner], pro indiviso share, and appellee Hilaria Figuracion [herein petitioner], pro indiviso share, who are hereby directed to partition the same and if
they could not agree on a partition, they may petition the trial court for the appointment of a commissioner to prepare a project of partition, in accordance with the procedure as provided
in Rule 69 of the 1997 Rules of Civil Procedure, as amended.

No pronouncement as to costs.

SO ORDERED.20

Respondent Emilia appealed the CAs decision to the Court, docketed as G.R. No. 154322. In a Decision promulgated on August 22, 2006, the Court denied the appeal, concurring with
the CAs ruling that a partition of Lot Nos. 2299 and 705 would be inappropriate considering that: (1) the ownership of Lot No. 705 is still in dispute; and (2) there are still unresolved
issues as to the expenses chargeable to the estate of Leandro.

The present petition involves the appeal of the petitioners who attribute this sole error committed by the CA:

THE DECISION RENDERED BY THE HONORABLE COURT OF APPEALS IS CONTRARY TO LAW AND EXISTING JURISPRUDENTIAL DICTA LAID DOWN BY THE HONORABLE
SUPREME COURT.21

In view of the Courts ruling in G.R. No. 154322, the ensuing discussion shall concern only Lot No. 707.

The Arguments of the Parties

The petitioners argue that respondent Emilia has no valid basis for her claim of ownership because the Deed of Quitclaim executed in her favor by Agripina was in fact a deed of
donation that contained no acceptance and thus, void. The petitioners attached a copy of the Deed of Quitclaim and stressed on the following portions, viz:

I, AGRIPINA ESTIOKO ADVIENTO, of le[ga]l age, Filipino citizen, single and a resident [of] San Vicenter (sic), Urdaneta City, Pangasinan, for and in consideration of the sum of ONE
PESO ([P]1.00), Philippine Currency and the services rendered by my niece EMILIA FIGURACION, 20 years old, single, Filipino citizen and a resident of San Vicente, Urdaneta City,
Pangasinan, do hereby by these presentsw (sic) RENOUNCE, RELEASE and forever QUITCLAIM in favor of EMILIA FIGURACION, her heirs, and assigns the ONE[-]HALF (1/2)
eastern portion of the following parcel of land more particularly described and bounded as follows to wit[.]22

They further aver that the Deed of Quitclaim is riddled with defects that evoke questions of law, because: (a) it has not been registered with the Register of Deeds, albeit, allegedly
executed as early as 1961; (b) a certification dated June 3, 2003 issued by the Office of the Clerk of Court (OCC) of the RTC of Urdaneta, Pangasinan, shows that it does not have a
copy of the Deed of Quitclaim; (c) the Office of the National Archives which is the depository of old and new notarized documents has no record of the Deed of Quitclaim as evidenced
by a certification dated May 19, 2003;23 and (d) Atty. Felipe V. Abenojar, who supposedly notarized the Deed of Quitclaim was not commissioned to notarize in 1961 per the
certification dated June 9, 2003 from the OCC of the RTC of Urdaneta, Pangasinan.24

Respondent Emilia, on the other hand, contends that the Deed of Quitclaim should be considered an onerous donation that requires no acceptance as it is governed by the rules on
contracts and not by the formalities for a simple donation.25

The Courts Ruling

Issues not raised before the courts a quo cannot be raised for the first time in a petition filed under Rule 45

Records show that there is a palpable shift in the defense raised by the petitioners before the RTC and the CA.

In the Pre-Trial Order26 of the RTC dated April 4, 1995, the parties agreed to limit the issue with regard to Lot No. 707 as follows: whether or not respondent Emilia is the owner of the
eastern half portion of Lot No. 707. The petitioners supporting theory for this issue was that "the Deed of Quitclaim dated November 28, 1961 was rendered ineffective by the issuance
of [TCT No. 42244] in the name of Felipa and Hilaria."27 On appeal to the CA, however, the petitioners raised a new theory by questioning the execution and enforceability of the Deed
of Quitclaim. They claimed that it is actually a donation that was not accepted in the manner required by law.28

The inconsistent postures taken by the petitioners breach the basic procedural tenet that a party cannot change his theory on appeal as expressly adopted in Rule 44, Section 15 of the
Rules of Court, which reads:

Sec. 15. Questions that may be raised on appeal. Whether or not the appellant has filed a motion for new trial in the court below, he may include in his assignment of errors any
question of law or fact that has been raised in the court below and which is within the issues framed by the parties.

Fortifying the rule, the Court had repeatedly emphasized that defenses not pleaded in the answer may not be raised for the first time on appeal. When a party deliberately adopts a
certain theory and the case is decided upon that theory in the court below, he will not be permitted to change the same on appeal, because to permit him to do so would be unfair to the
adverse party.29 The Court had likewise, in numerous times, affirmed that points of law, theories, issues and arguments not brought to the attention of the lower court need not be, and
ordinarily will not be, considered by a reviewing court, as these cannot be raised for the first time at such late stage. Basic considerations of due process underlie this rule. It would be
unfair to the adverse party who would have no opportunity to present further evidence material to the new theory, which it could have done had it been aware of it at the time of the
hearing before the trial court.30

While a party may change his theory on appeal when the factual bases thereof would not require presentation of any further evidence by the adverse party in order to enable it to
properly meet the issue raised in the new theory,31this exception does not, however, obtain in the case at hand.

Contrary to the petitioners assertion, the Court finds that the issues on the supposed defects and actual nature of the Deed of Quitclaim are questions of fact that require not only a
review or re-evaluation of the evidence already adduced by the parties but also the reception of new evidence as the petitioners themselves have acknowledged when they attached in
the petition several certifications32 in support of their new argument. It is settled that questions of fact are beyond the province of a Rule 45 petition since the Court is not a trier of
facts.33

Accordingly, the Court will not give due course to the new issues raised by the petitioners involving the nature and execution of the Deed of Quitclaim. For their failure to advance these
questions during trial, the petitioners are now barred by estoppel34 from imploring an examination of the same.

The respondent can compel the

partition of Lot No. 707

The first stage in an action for partition is the settlement of the issue of ownership. Such an action will not lie if the claimant has no rightful interest in the subject property. In fact, the
parties filing the action are required by the Rules of Court to set forth in their complaint the nature and the extent of their title to the property. It would be premature to effect a partition
until and unless the question of ownership is first definitely resolved.35

Here, the respondent traces her ownership over the eastern half of Lot No. 707 from the Deed of Quitclaim executed by Agripina, who in turn, was the co-owner thereof being one of the
legitimate heirs of Eulalio. It is well to recall that the petitioners failed to categorically dispute the existence of the Deed of Quitclaim. Instead, they averred that it has been rendered
ineffective by TCT No. 42244 in the name of Felipa and Hilariathis contention is, of course, flawed.

Mere issuance of a certificate of title in the name of any person does not foreclose the possibility that the real property may be under coownership with persons not named in the
certificate, or that the registrant may only be a trustee, or that other parties may have acquired interest over the property subsequent to the issuance of the certificate of title.36 Stated
differently, placing a parcel of land under the mantle of the Torrens system does not mean that ownership thereof can no longer be disputed. The certificate cannot always be
considered as conclusive evidence of ownership.37 In this case, co-ownership of Lot No. 707 was precisely what respondent Emilia was able to successfully establish, as
correctly found by the RTC and affirmed by the CA.

The status of Agripina and Carolina as the legitimate heirs of Eulalio is an undisputed fact. As such heirs, they became co-owners of Lot No. 707 upon the death of Eulalio on July 20,
1930. Since Faustina was predeceased by Eulalio, she likewise became a co-owner of the lot upon Eulalios death. Faustinas share, however, passed on to her daughter Carolina
when the former died on October 18, 1949. The Affidavit of Self-Adjudication executed by Carolina did not prejudice the share of Agripina because it is not legally possible for one to
adjudicate unto himself an entire property he was not the sole owner of. A co-owner cannot alienate the shares of her other co-owners nemo dat qui non habet.38

Hence, Lot No. 707 was a co-owned property of Agripina and Carolina. As co-owners, each of them had full ownership of her part and of the fruits and benefits pertaining thereto. Each
of them also had the right to alienate the lot but only in so far as the extent of her portion was affected.39

Thus, when Carolina sold the entire Lot No. 707 on December 11, 1962 to Hilaria and Felipa without the consent of her co-owner Agripina, the disposition affected only Carolinas pro
indiviso share, and the vendees, Hilaria and Felipa, acquired only what corresponds to Carolinas share. A co-owner is entitled to sell his undivided share; hence, a sale of the entire
property by one co-owner without the consent of the other co-owners is not null and void and only the rights of the co-owner/seller are transferred, thereby making the buyer a co-owner
of the property.40

Accordingly, the deed of sale executed by Carolina in favor of Hilaria and Felipa was a valid conveyance but only insofar as the share of Carolina in the co-ownership is concerned. As
Carolinas successors-in-interest to the property, Hilaria and Felipa could not acquire any superior right in the property than what Carolina is entitled to or could transfer or alienate after
partition.

In a contract of sale of co-owned property, what the vendee obtains by virtue of such a sale are the same rights as the vendor had as co-owner, and the vendee merely steps into the
shoes of the vendor as co-owner.41 Hilaria and Felipa did not acquire the undivided portion pertaining to Agripina, which has already been effectively bequeathed to respondent Emilia
as early as November 28, 1961 thru the Deed of Quitclaim. In turn, being the successor-in-interest of Agripinas share in Lot No. 707, respondent Emilia took the formers place in the
co-ownership and as such co-owner, has the right to compel partition at any time.42

The respondents right to demand

for partition is not barred by
acquisitive prescription or laches

The petitioners posit that the issuance of TCT No. 42244 in the name of Hilaria and Felipa over Lot No. 707 on December 11, 1962 was an express repudiation of the co-ownership with
respondent Emilia. Considering the period of time that has already lapsed since then, acquisitive prescription has already set in and the respondent is now barred by laches from
seeking a partition of the subject lot.

The contention is specious.

Co-heirs or co-owners cannot acquire by acquisitive prescription the share of the other co-heirs or co-owners absent a clear repudiation of the co ownership.43 The act of repudiation,
as a mode of terminating co-ownership, is subject to certain conditions, to wit: (1) a co-owner repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the
other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for
the period required by law.44

The petitioners failed to comply with these conditions. The act of Hilaria and Felipa in effecting the registration of the entire Lot No. 707 in their names thru TCT No. 42244 did not serve
to effectively repudiate the co-ownership. The respondent built her house on the eastern portion of the lot in 1981 without any opposition from the petitioners. Hilaria also paid realty
taxes on the lot, in behalf of the respondent, for the years 1983-1987.45 These events indubitably show that Hilaria and Felipa failed to assert exclusive title in themselves adversely to
Emilia. Their acts clearly manifest that they recognized the subsistence of their co-ownership with respondent Emilia despite the issuance of TCT No. 42244 in 1962. Their acts
constitute an implied recognition of the co-ownership which in turn negates the presence of a clear notice of repudiation to the respondent. To sustain a plea of prescription, it must
always clearly appear that one who was originally a joint owner has repudiated the claims of his co-owners, and that his co-owners were apprised or should have been apprised of his
claim of adverse and exclusive ownership before the alleged prescriptive period began to run.46

In addition, when Hilaria and Felipa registered the lot in their names to the exclusion of Emilia, an implied trust was created by force of law and the two of them were considered a
trustee of the respondents undivided share.47 As trustees, they cannot be permitted to repudiate the trust by relying on the registration. In Ringor v. Ringor,48 the Court had the
occasion to explain the reason for this rule:

A trustee who obtains a Torrens title over a property held in trust for him by another cannot repudiate the trust by relying on the registration. A Torrens Certificate of Title in
Joses name did not vest ownership of the land upon him. The Torrens system does not create or vest title. It only confirms and records title already existing and vested. It does not
protect a usurper from the true owner. The Torrens system was not intended to foment betrayal in the performance of a trust. It does not permit one to enrich himself at the expense of
another. Where one does not have a rightful claim to the property, the Torrens system of registration can confirm or record nothing. Petitioners cannot rely on the registration of the
lands in Joses name nor in the name of the Heirs of Jose M. Ringor, Inc., for the wrong result they seek. For Jose could not repudiate a trust by relying on a Torrens title he held in trust
for his co-heirs.1wphi1 The beneficiaries are entitled to enforce the trust, notwithstanding the irrevocability of the Torrens title. The intended trust must be sustained.49 (Citations
omitted and emphasis ours)

Further, records do not reflect conclusive evidence showing the manner of occupation and possession exercised by Hilaria and Felipa over the lot from the time it was registered in their
names. The only evidence of possession extant in the records dates back only to 1985 when Hilaria and Felipa declared the lot in their names for taxation purposes.50 Prescription can
only produce all its effects when acts of ownership, or in this case, possession, do not evince any doubt as to the ouster of the rights of the other co-owners. Hence, prescription among
co-owners cannot take place when acts of ownership exercised are vague or uncertain.51

Moreover, the evidence relative to the possession, as a fact upon which the alleged prescription is based, must be clear, complete and conclusive in order to establish said prescription
without any shadow of doubt; and when upon trial it is not shown that the possession of the claimant has been adverse and exclusive and opposed to the rights of the others, the case
is not one of ownership, and partition will lie.52 The petitioners failed to muster adequate evidence of possession essential for the reckoning of the 10-year period for acquisitive
prescription.

The express disavowal of the co-ownership did not happen on December 11, 1962 when TCT No. 42244 was issued but in 1994 when Hilaria attempted to demolish Emilias house
thus explicitly excluding her from the co-ownership. It was the only time that Hilaria and Felipa made known their denial of the co-ownership. On the same year, the respondent
instituted the present complaint for partition; hence, the period required by law for acquisitive period to set in was not met.

Anent laches, the Court finds it unavailing in this case in view of the proximity of the period when the co-ownership was expressly repudiated and when the herein complaint was filed.
Laches is the negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it has abandoned it or declined to assert
it.53 More so, laches is a creation of equity and its application is controlled by equitable considerations. It cannot be used to defeat justice or perpetrate fraud and injustice. Neither
should its application be used to prevent the rightful owners of a property from recovering what has been fraudulently registered in the name of another.54

Partition of Lot No. 707

Under the Old Civil Code55 which was then in force at the time of Eulalio and Marcelas marriage, Lot No. 707 was their conjugal property.56 When Marcela died, one-half of the lot was
automatically reserved to Eulalio, the surviving spouse, as his share in the conjugal partnership.57 Marcelas rights to the other half, in turn, were transmitted to her legitimate child,
Agripina and surviving spouse Eulalio.58 Under Article 834 of the Old Civil Code, Eulalio was entitled only to the usufruct of the lot while the naked ownership belonged to Agripina.
When he remarried, Eulalios one half portion of the lot representing his share in the conjugal partnership and his usufructuary right over the other half were brought into his second
marriage with Faustina.59

When Eulalio died on July 20, 1930, portion of the lot was reserved for Faustina as her share in the conjugal partnership.60 The remaining were transmitted equally to the widow
Faustina and Eulalios children, Carolina and Agripina.61 However, Faustina is only entitled to the usufruct of the third available for betterment.62

The usufructuary of Eulalio over the portion inherited by Agripina earlier was merged with her naked ownership.63Upon the death of Faustina, the shares in Lot No. 707 which
represents her share in the conjugal partnership and her inheritance from Eulalio were in turn inherited by Carolina64 including Faustinas usufructuary rights which were merged with
Carolinas naked ownership.65

Consequently, Agripina is entitled to 5/8 portion of Lot No. 707 while the remaining 3/8 pertains to Carolina. Thus, when Carolina sold Lot No. 707 to Hilaria and Felipa, the sale affected
only 3/8 portion of the subject lot. Since theDeed of Quitclaim, bequeathed only the eastern portion of Lot No. 707 in favor of Emilia instead of Agripinas entire 5/8 share thereof, the
remaining 1/8 portion shall be inherited by Agripinas nearest collateral relative,66 who, records show, is her sister Carolina.

In sum, the CA committed no reversible error in holding that the respondent is entitled to have Lot No. 707 partitioned. The CA judgment must, however, be modified to conform to the
above-discussed apportionment of the lot among Carolina, Hilaria, Felipa and Emilia.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. CV No. 58290 dated December 11, 2001, is AFFIRMED with MODIFICATIONS as follows: (1)
3/8 portion of Lot No. 707 shall pertain in equal shares to Hilaria Figuracion and Felipa Figuracion-Manuel; (2) portion of Lot. No. 707 shall pertain to Emilia Figuracion-Gerilla; and (3)
1/8 portion of Lot No. 707 shall pertain to the estate of Carolina (Carlina) Vda. De Figuracion. The case is REMANDED to the Regional Trial Court of Urdaneta, Pangasinan, Branch 49,
who is directed to conduct a PARTITION BY COMMISSIONERS and effect the actual physical partition of the subject property, as well as the improvements that lie therein, in the
foregoing manner. The trial court is DIRECTED to appoint not more than three (3) competent and disinterested persons, who should determine the technical metes and bounds of the
property and the proper share appertaining to each co-owner, including the improvements, in accordance with Rule 69 of the Rules of Court. When it is made to appear to the
commissioners that the real estate, or a portion thereof, cannot be divided without great prejudice to the interest of the parties, the court a quo may order it assigned to one of the
parties willing to take the same, provided he pays to the other parties such sum or sums of money as the commissioners deem equitable, unless one of the parties interested ask that
the property be sold instead of being so assigned, in which case the court shall order the commissioners to sell the real estate at public sale, and the commissioners shall sell the same
accordingly, and thereafter distribute the proceeds of the sale appertaining to the just share of each co-owner. No pronouncement as to costs.

SO ORDERED.

19. G.R. No. 173926

March 6, 2013

HEIRS OF LORENZO BUENSUCESO, represented by German Buensuceso, as substituted by Iluminada Buensuceso, Ryan Buensuceso and Philip Buensuceso, Petitioners,
vs.
LOVY PEREZ, substituted by Erlinda Perez-Hernandez, Teodoro G. Perez and Candida Perez-Atacador,Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 filed by the Heirs of Lorenzo Buensuceso (Lorenzo), represented by German Buensuceso (German), to nullify the decision2 dated April
27, 2006 and the resolution3 dated August 4, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 85931 insofar as it reversed the September 4, 2003 resolution4 of the Department of
Agrarian Reform Adjudication Board (DARAB) in DARAB Case No. 7178. The DARAB resolution set aside its earlier decision5 and the decision of the Provincial Agrarian Reform
Adjudication Board (PARAD)6 dismissing Germans complaint for recovery of possession7 against Lovy Perez.

The Factual Antecedents

As the CA summarized in the assailed decision, German was the son and heir of Lorenzo Buensuceso, the farmer-beneficiary of an agricultural lot, one point thirty-seven (1.37)
hectares in area, situated in Sto. Cristo, Gapan, Nueva Ecija (disputed lot). The disputed lot was awarded to

Lorenzo pursuant to Operation Land Transfer under Presidential Decree (P.D.) No. 27, and covered by Certificate of Land Transfer No. 049645 (CLT)8 issued on July 28, 1973. Upon
Lorenzos death, German allegedly immediately occupied the disputed lot and had been cultivating and residing within its premises since then. German claimed that, in 1989, Lovy
Perez forcibly entered the disputed lot, thus, compelling him to file a petition for recovery of possession with the PARAD.

In her answer with counterclaim, Lovy argued that she is the real and lawful tenant of the disputed lot as evidenced by: (1) the duly acknowledged and registered contract of leasehold
(lease contract)9 dated October 5, 1988, between her and the landowner, Joaquin Garces, which Lorenzo signed as a witness; and (2) the certifications issued by the Municipal
Agrarian Reform Officer (MARO) of the Department of Agrarian Reform (DAR),10 Gapan, Nueva Ecija, and by the Barangay Agrarian Reform Council11 stating that she is the disputed
lots registered agricultural lessee. She also claimed that she has been paying the lease rentals to Garces, as shown by receipts,12and the irrigation services13 beginning 1984 as
certified to by the National Irrigation Administration, and that she is a bona fide member of the Samahang Nayon.

On July 31, 1997, the PARAD dismissed the petition, ruling that German failed to prove that he or his father, Lorenzo, was the farm helper or the regular tenant-lessee of the disputed
lot. In contrast, Lovy successfully proved that she was the lawful tenant-lessee from all of her documentary evidence, particularly the lease contract, which established the tenancy
relation between her and Garces. German appealed the dismissal to the DARAB.

The Ruling of the DARAB

On January 16, 2001, the DARAB affirmed in toto the PARADs decision. German sought reconsideration, which he obtained in due course.

In its resolution, the DARAB set aside its earlier decision and ordered Lovy to surrender possession of the disputed lot to German. This time, the DARAB considered the CLT as clear
evidence of the Governments recognition of Lorenzo as the tenant-beneficiary of the disputed lot entitled to avail of the statutory mechanisms under P.D. No. 27 for acquiring its
ownership. It maintained the presumption of the CLTs continued validity, as the record neither showed that it was cancelled nor that grounds exist for its cancellation. Also, the DARAB
refused to recognize the personality of Garces to execute the lease contract and declared it void. It held that Lorenzo is deemed the owner of the disputed lot from the time the CLT was
issued in 1973. When the DARAB denied her motion for reconsideration, Lovy filed a petition for review14 with the CA.

While the case was pending before the CA, Lovy died and was substituted by her heirs - Erlinda Perez-Hernandez, Teodoro G. Perez and Candida Perez-Atacador (respondents).

The Ruling of the CA

The CA granted Lovys appeal and reversed the DARAB resolution. As the decisions of the PARAD and the DARAB earlier did, the CA ruled that Lorenzo had long abandoned the
disputed lot, which he confirmed when he signed as a witness to the lease contract between Garces and Lovy; that, with the execution of the lease contract, Lovy became the qualified
farmer-beneficiary, who then cultivated the disputed lot on her own account.

Additionally, the CA declared that Lorenzos CLT was not sufficient to constitute him as the owner of the disputed lot since Lorenzo failed to comply with the obligation to pay the lease
rentals that Section 26 of Republic Act (R.A.) No. 3844 requires. The CA denied Germans motion for reconsideration in its August 4, 2006 resolution,15 prompting the present
recourse.

The Petition

German faults the CA for not upholding the validity and legality of Lorenzos CLT. He argues that, as holder of the CLT, he as Lorenzos heir was entitled not only to the possession
of the disputed lot16 but also to the full benefits of a farmer-tenant under P.D. No. 27. He also argues that nothing on the records showed that the CLT had been cancelled; that Lorenzo
had failed to comply with his obligations as tenant-beneficiary; or that he or Lorenzo had abandoned the disputed lot.17

On October 16, 2006,18 during the pendency of the case before the Court, German died and was substituted by his wife, Iluminada, and his sons, Ryan and Philip (a minor), all
surnamed Buensuceso.19

The Case for the Respondents

In their defense, the respondents argue that: first, a petition for review under Rule 45 is restricted to questions of law. The question of who between Lorenzo and German, on the one
hand, and Lovy, on the other, actually tilled and cultivated the disputed lot is a clear question of fact that is not proper for a Rule 45 petition.20

Second, no cogent reason exists to modify or reverse the CAs decision as the duly notarized and registered lease contract, among others, indisputably shows that Lovy had been
actually cultivating the disputed lot since 1984.21

Third, the factual findings of the PARAD, the DARAB (in its earlier January 16, 2001 decision) and the CA are binding and conclusive on this Court, especially when, as in this case,
they are supported by substantial evidence.22

Lastly, on the issue of ownership, the respondents maintain that Lorenzos CLT is not sufficient to constitute him as owner of the disputed lot since he must first comply with certain
requisites and conditions before he can acquire absolute ownership over it. By abandoning the disputed lot, Lorenzo failed to comply with his obligations as a CLT holder, thus
disqualifying him from its possession.23

The Courts Ruling

We first address the procedural matters raised.

The rules invoked by the respondents are well settled: a Rule 45 petition is limited to questions of law, and the factual findings of the lower courts are, as a rule, conclusive on this
Court.24 The question of who, between German and the respondents, is entitled to the continued possession of the disputed lot involves factual issues and is not the proper subject of a
Rule 45 petition.

Despite this Rule 45 requirement, however, our pronouncements have likewise recognized exceptions, such as the situation obtaining here where the tribunals below conflict in their
factual findings.25 We note that the DARAB (in its resolution) in effect reversed its earlier decision and the PARADs ruling while the CA, in turn, set aside the DARABs September 4,
2003 resolution. In this light, we cannot support the procedural objection raised.

On the merits, German, as substituted by his heirs, asserts possession and ownership over the disputed lot, emphasizing the issuance of and the continued validity of Lorenzos CLT.
They invoke P.D. No. 27 to justify their position, arguing that as holder in due course of a CLT, Lorenzo remains a qualified beneficiary under the Act.

The respondents, on the other hand, claim entitlement to the continued possession of the disputed lot following the declarations of the PARAD, the DARAB (in its earlier decision) and
the CA that Lovy is the disputed lots lawful tenant. Also, they insist that Lorenzo or his heirs cannot be the owners of the disputed lot because Lorenzo failed to comply with his
obligations under the CLT. Neither can German possess the disputed lot because Lorenzo had long abandoned it.

On the issue of ownership of the disputed lot

We agree with the CA that the mere issuance of the CLT does not vest full ownership on the holder26 and does not automatically operate to divest the landowner of all of his rights over
the landholding. The holder must first comply with certain mandatory requirements to effect a transfer of ownership. Under R.A. No. 665727 in relation with P.D. No. 2728 and E.O. No.
228,29 the title to the landholding shall be issued to the tenant-farmer only upon the satisfaction of the following requirements: (1) payment in full of the just compensation for the
landholding, duly determined by final judgment of the proper court; (2) possession of the qualifications of a farmer-beneficiary under the law; (3) full-pledged membership of the farmerbeneficiary in a duly recognized farmers cooperative; and (4) actual cultivation of the landholding. We explained in several cases that while a tenant with a CLT is deemed the owner of
a landholding, the CLT does not vest full ownership on him.30 The tenant-holder of a CLT merely possesses an inchoate right that is subject to compliance with certain legal
preconditions for perfecting title and acquiring full ownership. For these reasons, we hold that Lorenzos right and claim to ownership over the disputed lot were, at most, inchoate.31

In the same vein, we hold that German as Lorenzos heir is not automatically rendered the owner of the disputed lot. German must also still first comply with certain procedural and
mandatory requirements in order to acquire Lorenzos rights under the CLT, including the right to acquire ownership of the disputed lot. Under Section 27 of R.A. No. 6657, lands not yet
fully paid by the beneficiary may be transferred, with prior approval of the DAR, to any heir of the beneficiary who, as a condition for such transfer, shall cultivate the land for himself.

On the validity of the lease contract between Garces and Lovy

We agree with the DARAB, in its resolution, that Garces had no authority to execute the lease contract. While Garces, as landowner, retained an interest over the disputed lot, any
perceived failure on Lorenzos part to comply with his obligations under the CLT did not cause the automatic cancellation of the CLT nor of the disputed lots reversion to Garces. "Lands
acquired under P.D. No. 27 do not revert to the landowner,"32 and this is true even if the CLT is cancelled. The land must be transferred back to the government and Garces could not,
by himself, institute Lovy as the new tenant-beneficiary.

Pursuant to R.A. No. 6657 in relation with P.D. No. 27,33 any sale or disposition of agricultural lands made after the effectivity of R.A. No. 6657 which has been found contrary to its
provisions shall be null and void. The proper procedure for the reallocation of the disputed lot must be followed to ensure that there indeed exist grounds for the cancellation of the CLT
or for forfeiture of rights under it, and that the lot is subsequently awarded to a qualified farmer-tenant pursuant to the law.34

Under Ministry Memorandum Circular No. 04-83 in relation with Ministry Memorandum Circular No. 08-80 and Ministry Memorandum Circular No. 07-79, the following procedures must
be observed for the reallocation of farmholdings covered by P.D. No. 27 by reason of abandonment or the refusal to become a beneficiary, among others:

I. Investigation Procedure

1. The conduct of verification by the concerned Agrarian Reform Team Leader (ARTL) to ascertain the reasons for the refusal. All efforts shall be exerted to convince the
tenant-farmer to become a beneficiary and to comply with his obligations as such beneficiary.

2. If the tenant-farmer still refuses, the ARTL shall determine the substitute. The ARTL shall first consider the immediate member of the tenant-farmers family who
assisted in the cultivation of the land, and who is willing to be substituted to all the rights and obligations of the tenant-farmer. In the absence or refusal of such member,
the ARTL shall choose one from a list of at least three qualified tenants recommended by the President of the Samahang Nayon or, in default, any organized farmer
association, subject to the award limits under P.D. No. 27.

3. Formal notice of the report shall be given to the concerned farmer-beneficiary together with all the pertinent documents and evidences.

4. The ARTL shall submit the records of the case with his report and recommendation to the District Officer within 5 days from the ARTLs determination of the substitute.
The District Officer shall likewise submit his report and recommendation to the Regional Director and the latter to the Bureau of Agrarian Legal Assistance, for review,
evaluation, and preparation of the final draft decision for final approval.

5. The decision shall declare the cancellation of the CLT if issued.35

In the event of the farmer-beneficiarys death, the transfer or reallocation of his landholding to his heirs shall be governed by Ministry Memorandum Circular No. 19-78.

In the present case, as Associate Justice Estela M. Perlas-Bernabe observed in her Reflections, Lorenzos CLT was not shown to have been properly cancelled in light of the failure to
observe the required procedures or processes. Thus, we declare the lease contract between Garces and Lovy as void. Consequently, we cannot recognize Lovys claim that she is the
present and actual agricultural lessee of the disputed lot.

As to whether Lorenzo abandoned the disputed lot

We find merit in the respondents argument that Lorenzo had long abandoned the disputed lot, thus, depriving him and his heirs of possession over it. Abandonment is a ground for the
termination of tenancy relations under Section 8 of R.A. No. 3844,36 and, under Section 22 of R.A. No. 6657 as well as under DAR Administrative Order No. 02-94 in relation to Section
22, R.A. 6657, disqualifies the beneficiary of lots awarded under P.D. No. 27 from its coverage. To additionally reiterate what we have discussed above, actual cultivation of the
farmholding is a mandatory condition for the transfer of rights under the CLT to qualify the transferee as a beneficiary under Section 22 of R.A. No. 6657.

For abandonment to exist, the following requisites must concur: (1) a clear intent to abandon; and (2) an external act showing such intent.37 The term is defined as the "willful failure of
the ARB, together with his farm household, to cultivate, till, or develop his land to produce any crop, or to use the land for any specific economic purpose continuously for a period of two
calendar years."38 It entails, among others, the relinquishment of possession of the lot for at least two (2) calendar years and the failure to pay the amortization for the same
period.39 "What is critical in abandonment is intent which must be shown to be deliberate and clear."40 The intent must be established by the factual failure to work on the landholding
absent any valid Reason41 as well as a clear intent, which is shown as a separate element.

In the present case, Lorenzo, in allowing and acquiescing to the execution of the lease contract through his signature, with presumed full awareness of its implications,42 effectively
surrendered his rights over the disputed lot. His signing of the lease contract constitutes the external act of abandonment. Notably, neither Lorenzo nor German impugned the existence
or the execution of the lease contract or the validity of Lorenzos signature on it during the proceedings before the PARAD and the DARAB. Additionally, German did not present any
evidence to support his position that Lovy forcibly entered the disputed property, thus depriving them of its possession and actual cultivation.1wphi1

We observe that, in contrast with the respondents unwavering position that Lovy had been in actual possession and cultivation of the disputed lot since 1988, Germans assertion of
continuous possession and cultivation is significantly weakened by the inconsistencies in his pleadings. German claimed that Lorenzo had been continuously tilling the disputed lot until
1989 when Lovy forcibly entered and took over its possession. At the same time, he maintained that he immediately took possession and actual cultivation of the disputed lot upon
Lorenzos death and had been in its possession since then. Interestingly, Lorenzo died in 1992. What is clear, however, from Germans various averments is that Lorenzo had not been
cultivating the disputed lot since 1988. Even if we were to believe Germans claim of continued possession and actual cultivation of the disputed lot even after Lovy forcibly entered in
1989, this claim only supports the finding of abandonment. Lorenzo would not have stood idly and allowed Lovy to cultivate the disputed lot if he did not have the intention to abandon
its possession in favor of the latter.

We reiterate that abandonment is a ground for the cancellation of a CLT and the forfeiture of the farmer-beneficiarys right to the landholding. Nevertheless, for a cancellation or
forfeiture to take place, the proper procedures must be observed and a final judgment rendered declaring a cancellation or forfeiture.

WHEREFORE, in view of these considerations, we hereby REMAND this case to the Department of Agrarian Reform for the conduct of investigation and of the necessary proceedings
to determine the qualified beneficiary of the disputed lot. No costs.

SO ORDERED.

20. G.R. No. 176422

March 20, 2013

MARIA MENDOZA, in her own capacity and as Attorney-in-fact of DEOGRACIAS, MARCELA, DIONISIA, ADORA CION, all surnamed MENDOZA, REMEDIOS MONTILLA,
FELY BAUTISTA, JULIANA GUILALAS and ELVIRA MENDOZA, Petitioners,
vs.
JULIA POLl CARPIO DELOS SANTOS, substituted by her heirs, CARMEN P. DELOS SANTOS, ROSA BUENA VENTURA, ZENAIDA P. DELOS SANTOS VDA. DE MATEO,
LEONILA P. DELOS SANTOS, ELVIRA P. DELOS SANTOS VDA. DE JOSE, TERESITA P. DELOS SANTOS-CABUHAT, MERCEDITA P. DELOS SANTOS, LYDIA P. DELOS
SANTOS VDA. DE HILARIO, PERFECTO P. DELOS SANTOS, JR., and CECILIA M. MENDOZA,Respondents.

DECISION

REYES, J.:

Reserva troncal is a special rule designed primarily to assure the return of a reservable property to the third degree relatives belonging to the line from which the property originally
came, and avoid its being dissipated into and by the relatives of the inheriting ascendant.1

The Facts

The properties subject in the instant case are three parcels of land located in Sta. Maria, Bulacan: (1) Lot 1681-B, with an area of 7,749 square meters;2 (2) Lot 1684, with an area of
5,667 sq m;3 and (3) Lot No. 1646-B, with an area of 880 sq m.4 Lot Nos. 1681-B and 1684 are presently in the name of respondent Julia Delos Santos5(respondent). Lot No. 1646-B,
on the other hand, is also in the name of respondent but co-owned by Victoria Pantaleon, who bought one-half of the property from petitioner Maria Mendoza and her siblings.

Petitioners are grandchildren of Placido Mendoza (Placido) and Dominga Mendoza (Dominga). Placido and Dominga had four children: Antonio, Exequiel, married to Leonor, Apolonio
and Valentin. Petitioners Maria, Deogracias, Dionisia, Adoracion, Marcela and Ricardo are the children of Antonio. Petitioners Juliana, Fely, Mercedes, Elvira and Fortunato, on the
other hand, are Valentins children. Petitioners alleged that the properties were part of Placido and Domingas properties that were subject of an oral partition and subsequently
adjudicated to Exequiel. After Exequiels death, it passed on to his spouse Leonor and only daughter, Gregoria. After Leonors death, her share went to Gregoria. In 1992, Gregoria died
intestate and without issue. They claimed that after Gregorias death, respondent, who is Leonors sister, adjudicated unto herself all these properties as the sole surviving heir of
Leonor and Gregoria. Hence, petitioners claim that the properties should have been reserved by respondent in their behalf and must now revert back to them, applying Article 891 of the
Civil Code on reserva troncal.

Respondent, however, denies any obligation to reserve the properties as these did not originate from petitioners familial line and were not originally owned by Placido and Dominga.
According to respondent, the properties were bought by Exequiel and Antonio from a certain Alfonso Ramos in 1931. It appears, however, that it was only Exequiel who was in
possession of the properties.6

The Regional Trial Court (RTC) of Malolos, Bulacan, Branch 6, found merit in petitioners claim and granted their action for Recovery of Possession by Reserva Troncal, Cancellation of
TCT and Reconveyance. In its Decision dated November 4, 2002, the RTC disposed as follows:

WHEREFORE, premised from the foregoing judgment is hereby rendered:

1. Ordering respondents (heirs of Julia Policarpio) to reconvey the three (3) parcels of land subject of this action in the name of the plaintiffs enumerated in the complaint
including intervenor Maria Cecilia M. Mendoza except one-half of the property described in the old title, TCT No. T-124852(M) which belongs to Victorina Pantaleon;

2. Ordering the Register of Deeds of Bulacan to cancel the titles in the name of Julia Policarpio, TCT No. T-149033(M), T-183631(M) and T-149035(M) and reconvey the
same to the enumerated plaintiffs; and

3. No pronouncement as to claims for attorneys fees and damages and costs.

SO ORDERED.7

On appeal, the Court of Appeals (CA) reversed and set aside the RTC decision and dismissed the complaint filed by petitioners. The dispositive portion of the CA Decision dated
November 16, 2006 provides:

WHEREFORE, premises considered, the November 4, 2002 Decision of the Regional Trial Court, Br. 6, Third Judicial Region, Malolos, Bulacan, is REVERSED and SET ASIDE. The
Third Amended Complaint in Civil Case No. 609-M-92 is hereby DISMISSED. Costs against the Plaintiffs-Appellants.

SO ORDERED.8

Petitioners filed a motion for reconsideration but the CA denied the same per Resolution9 dated January 17, 2007.

In dismissing the complaint, the CA ruled that petitioners failed to establish that Placido and Dominga owned the properties in dispute.10 The CA also ruled that even assuming that
Placido and Dominga previously owned the properties, it still cannot be subject to reserva troncal as neither Exequiel predeceased Placido and Dominga nor did Gregoria predecease
Exequiel.11

Now before the Court, petitioners argue that:

A.

THE HONORABLE [CA] GRIEVOUSLY ERRED IN HOLDING THAT THE SUBJECT PROPERTIES ARE NOT RESERVABLE PROPERTIES, COMING AS THEY DO
FROM THE FAMILY LINE OF THE PETITIONERS MENDOZAS.

B.

THE HONORABLE [CA] GRIEVOUSLY ERRED IN HOLDING THAT THE PETITIONERS MENDOZAS DO NOT HAVE A RIGHT TO THE SUBJECT PROPERTIES BY
VIRTUE OF THE LAW ON RESERVA TRONCAL.12

Petitioners take exception to the ruling of the CA, contending that it is sufficient that the properties came from the paternal line of Gregoria for it to be subject to reserva troncal. They
also claim the properties in representation of their own predecessors, Antonio and Valentin, who were the brothers of Exequiel.13

Ruling of the Court

This petition is one for review on certiorari under Rule 45 of the Rules of Court. The general rule in this regard is that it should raise only questions of law. There are, however, admitted
exceptions to this rule, one of which is when the CAs findings are contrary to those of the trial court.14 This being the case in the petition at hand, the Court must now look into the
differing findings and conclusion of the RTC and the CA on the two issues that arise one, whether the properties in dispute are reservable properties and two, whether petitioners are
entitled to a reservation of these properties.

Article 891 of the Civil Code on reserva troncal

The principle of reserva troncal is provided in Article 891 of the Civil Code:

Art. 891. The ascendant who inherits from his descendant any property which the latter may have acquired by gratuitous title from another ascendant, or a brother or sister, is obliged to
reserve such property as he may have acquired by operation of law for the benefit of relatives who are within the third degree and belong to the line from which said property came.
(Emphasis ours)

There are three (3) lines of transmission in reserva troncal. The first transmission is by gratuitous title, whether by inheritance or donation, from an ascendant/brother/sister to a
descendant called the prepositus. The second transmission is by operation of law from the prepositus to the other ascendant or reservor, also called the reservista. The third and last
transmission is from the reservista to the reservees or reservatarios who must be relatives within the third degree from which the property came.15

The lineal character of the

reservable property is reckoned
from the ascendant from whom the
prepositus received the property by
gratuitous title

Based on the circumstances of the present case, Article 891 on reserva troncal is not applicable.

The fallacy in the CAs resolution is that it proceeded from the erroneous premise that Placido is the ascendant contemplated in Article 891 of the Civil Code. From thence, it sought to
trace the origin of the subject properties back to Placido and Dominga, determine whether Exequiel predeceased Placido and whether Gregoria predeceased Exequiel.

The persons involved in reserva troncal are:

(1) The ascendant or brother or sister from whom the property was received by the descendant by lucrative or gratuitous title;

(2) The descendant or prepositus (propositus) who received the property;

(3) The reservor (reservista), the other ascendant who obtained the property from the prepositus by operation of law; and

(4) The reservee (reservatario) who is within the third degree from the prepositus and who belongs to the (linea o tronco) from which the property came and for whom the
property should be reserved by the reservor.16

It should be pointed out that the ownership of the properties should be reckoned only from Exequiels as he is the ascendant from where the first transmission occurred, or from whom
Gregoria inherited the properties in dispute. The law does not go farther than such ascendant/brother/sister in determining the lineal character of the property.17It was also immaterial
for the CA to determine whether Exequiel predeceased Placido and Dominga or whether Gregoria predeceased Exequiel. What is pertinent is that Exequiel owned the properties and
he is the ascendant from whom the properties in dispute originally came. Gregoria, on the other hand, is the descendant who received the properties from Exequiel by gratuitous title.

Moreover, Article 891 simply requires that the property should have been acquired by the descendant or prepositus from an ascendant by gratuitous or lucrative title. A transmission is
gratuitous or by gratuitous title when the recipient does not give anything in return.18 At risk of being repetitious, what was clearly established in this case is that the properties in
dispute were owned by Exequiel (ascendant). After his death, Gregoria (descendant/prepositus) acquired the properties as inheritance.

Ascendants, descendants and

collateral relatives under Article
964 of the Civil Code

Article 891 provides that the person obliged to reserve the property should be an ascendant (also known as the reservor/reservista) of the descendant/prepositus. Julia, however, is not
Gregorias ascendant; rather, she is Gregorias collateral relative.

Article 964 of the Civil Code provides for the series of degrees among ascendants and descendants, and those who are not ascendants and descendants but come from a common
ancestor, viz:

Art. 964. A series of degrees forms a line, which may be either direct or collateral.1wphi1 A direct line is that constituted by the series of degrees among ascendants and descendants.

A collateral line is that constituted by the series of degrees among persons who are not ascendants and descendants, but who come from a common ancestor. (Emphasis and italics
ours)

Gregorias ascendants are her parents, Exequiel and Leonor, her grandparents, great-grandparents and so on. On the other hand, Gregorias descendants, if she had one, would be
her children, grandchildren and great-grandchildren. Not being Gregorias ascendants, both petitioners and Julia, therefore, are her collateral relatives. In determining the collateral line
of relationship, ascent is made to the common ancestor and then descent to the relative from whom the computation is made. In the case of Julias collateral relationship with Gregoria,
ascent is to be made from Gregoria to her mother Leonor (one line/degree), then to the common ancestor, that is, Julia and Leonors parents (second line/degree), and then descent to
Julia, her aunt (third line/degree). Thus, Julia is Gregorias collateral relative within the third degree and not her ascendant.

First cousins of the

descendant/prepositus are fourth
degree relatives and cannot be
considered reservees/reservatarios

Moreover, petitioners cannot be considered reservees/reservatarios as they are not relatives within the third degree of Gregoria from whom the properties came. The person from whom
the degree should be reckoned is the descendant/prepositusthe one at the end of the line from which the property came and upon whom the property last revolved by descent.19 It is
Gregoria in this case. Petitioners are Gregorias fourth degree relatives, being her first cousins. First cousins of the prepositus are fourth degree relatives and are not reservees or
reservatarios.20

They cannot even claim representation of their predecessors Antonio and Valentin as Article 891 grants a personal right of reservation only to the relatives up to the third degree from
whom the reservable properties came. The only recognized exemption is in the case of nephews and nieces of the prepositus, who have the right to represent their ascendants (fathers
and mothers) who are the brothers/sisters of the prepositus and relatives within the third degree.21 In Florentino v. Florentino,22 the Court stated:

Following the order prescribed by law in legitimate succession, when there are relatives of the descendant within the third degree, the right of the nearest relative, called reservatario,
over the property which the reservista (person holding it subject to reservation) should return to him, excludes that of the one more remote. The right of representation cannot be alleged
when the one claiming same as a reservatario of the reservable property is not among the relatives within the third degree belong to the line from which such property came, inasmuch
as the right granted by the Civil Code in Article 811 now Article 891 is in the highest degree personal and for the exclusive benefit of the designated persons who are the relatives, within
the third degree, of the person from whom the reservable property came. Therefore, relatives of the fourth and the succeeding degrees can never be considered as reservatarios, since
the law does not recognize them as such.

x x x Nevertheless there is right of representation on the part of reservatarios who are within the third degree mentioned by law, as in the case of nephews of the deceased person from
whom the reservable property came. x x x.23 (Emphasis and underscoring ours)

The conclusion, therefore, is that while it may appear that the properties are reservable in character, petitioners cannot benefit from reserva troncal. First, because Julia, who now holds
the properties in dispute, is not the other ascendant within the purview of Article 891 of the Civil Code and second, because petitioners are not Gregorias relatives within the third
degree. Hence, the CAs disposition that the complaint filed with the RTC should be dismissed, only on this point, is correct. If at all, what should apply in the distribution of Gregorias
estate are Articles 1003 and 1009 of the Civil Code, which provide:

Art. 1003. If there are no descendants, ascendants, illegitimate children, or a surviving spouse, the collateral relatives shall succeed to the entire estate of the deceased in accordance
with the following articles.

Art. 1009. Should there be neither brothers nor sisters, nor children of brothers or sisters, the other collateral relatives shall succeed to the estate.

The latter shall succeed without distinction of lines or preference among them by reason of relationship by the whole blood.

Nevertheless, the Court is not in the proper position to determine the proper distribution of Gregorias estate at this point as the cause of action relied upon by petitioners in their
complaint filed with the RTC is based solely on reserva troncal. Further, any determination would necessarily entail reception of evidence on Gregorias entire estate and the heirs
entitled thereto, which is best accomplished in an action filed specifically for that purpose.

A reservista acquires ownership of

the reservable property until the
reservation takes place or is
extinguished

Before concluding, the Court takes note of a palpable error in the RTCs disposition of the case. In upholding the right of petitioners over the properties, the RTC ordered the
reconveyance of the properties to petitioners and the transfer of the titles in their names. What the RTC should have done, assuming for arguments sake that reserva troncal is
applicable, is have the reservable nature of the property registered on respondents titles. In fact, respondent, as reservista, has the duty to reserve and to annotate the reservable
character of the property on the title.24 In reserva troncal, the reservista who inherits from a prepositus, whether by the latters wish or by operation of law, acquires the inheritance by
virtue of a title perfectly transferring absolute ownership. All the attributes of ownership belong to him exclusively.25

The reservor has the legal title and dominion to the reservable property but subject to the resolutory condition that such title is extinguished if the reservor predeceased the reservee.
The reservor is a usufructuary of the reservable property. He may alienate it subject to the reservation. The transferee gets the revocable and conditional ownership of the reservor. The
transferees rights are revoked upon the survival of the reservees at the time of the death of the reservor but become indefeasible when the reservees predecease the
reservor.26 (Citations omitted)

It is when the reservation takes place or is extinguished,27 that a reservatario becomes, by operation of law, the owner of the reservable property.28 In any event, the foregoing
discussion does not detract from the fact that petitioners are not entitled to a reservation of the properties in dispute.

WHEREFORE, the petition is DENIED. The Decision dated November 16, 2006 and Resolution dated January 17, 2007 of the Court of Appeals in CA-G.R. CV No. 77694 insofar as it
dismissed the Third Amended Complaint in Civil Case No. 609-M-92 are AFFIRMED. This Decision is without prejudice to any civil action that the heirs of Gregoria

Mendoza may file for the settlement of her estate or for the determination of ownership of the properties in question.

SO ORDERED.

21. G.R. No. 174727

August 12, 2013

ANTIPOLO INING (DECEASED), SURVIVED BY MANUEL VILLANUEVA, TEODORA VILLANUEVA-FRANCISCO, CAMILO FRANCISCO, ADOLFO FRANCISCO, LUCIMO
FRANCISCO, JR., MILAGROS FRANCISCO,* CELEDONIO FRANCISCO, HERMINIGILDO FRANCISCO; RAMON TRESVALLES, ROBERTO TAJONERA, NATIVIDAD ININGIBEA (DECEASED) SURVIVED BY EDILBERTO IBEA, JOSEFA IBEA, MARTHA IBEA, CARMEN IBEA, AMPARO IBEA-FERNANDEZ, HENRY RUIZ, EUGENIO RUIZ AND
PASTOR RUIZ; DOLORES INING-RIMON (DECEASED) SURVIVED BY JESUS RIMON, CESARIA RIMON GONZALES AND REMEDIOS RIMON CORDERO; AND PEDRO INING
(DECEASED) SURVIVED BY ELISA TAN INING (WIFE) AND PEDRO INING, JR., PETITIONERS,
vs.
LEONARDO R. VEGA, SUBSTITUTED BY LOURDES VEGA, RESTONILO I. VEGA, CRISPULO M. VEGA, MILBUENA VEGA-RESTITUTO, AND LENARD
VEGA, RESPONDENTS.

DECISION

DEL CASTILLO, J.:

One who is merely related by affinity to the decedent does not inherit from the latter and cannot become a co-owner of the decedents property. Consequently, he cannot effect a
repudiation of the co-ownership of the estate that was formed among the decedents heirs.

Assailed in this Petition for Review on Certiorari1 are the March 14, 2006 Decision2 of the Court of Appeals (CA) in CA-G.R. CV No. 74687 and its September 7, 2006
Resolution3 denying petitioners Motion for Reconsideration.4

Factual Antecedents

Leon Roldan (Leon), married to Rafaela Menez (Rafaela), is the owner of a 3,120-square meter parcel of land (subject property) in Kalibo, Aklan covered by Original Certificate of Title
No. (24071) RO-6305 (OCT RO-630). Leon and Rafaela died without issue. Leon was survived by his siblings Romana Roldan (Romana) and Gregoria Roldan Ining (Gregoria), who
are now both deceased.

Romana was survived by her daughter Anunciacion Vega and grandson, herein respondent Leonardo R. Vega (Leonardo) (also both deceased). Leonardo in turn is survived by his wife
Lourdes and children Restonilo I. Vega, Crispulo M. Vega, Milbuena Vega-Restituto and Lenard Vega, the substituted respondents.

Gregoria, on the other hand, was survived by her six children: petitioners Natividad Ining-Ibea (Natividad), Dolores Ining-Rimon (Dolores), Antipolo, and Pedro; Jose; and Amando.
Natividad is survived by Edilberto Ibea, Josefa Ibea, Martha Ibea, Carmen Ibea, Amparo Ibea-Fernandez, Henry Ruiz and Pastor Ruiz. Dolores is survived by Jesus Rimon, Cesaria
Rimon Gonzales and Remedios Rimon Cordero. Antipolo is survived by Manuel Villanueva, daughter Teodora Villanueva-Francisco (Teodora), Camilo Francisco (Camilo), Adolfo
Francisco (Adolfo), Lucimo Francisco, Jr. (Lucimo Jr.), Milagros Francisco, Celedonio Francisco, and Herminigildo Francisco (Herminigildo). Pedro is survived by his wife, Elisa Tan
Ining and Pedro Ining, Jr. Amando died without issue. As for Jose, it is not clear from the records if he was made party to the proceedings, or if he is alive at all.

In short, herein petitioners, except for Ramon Tresvalles (Tresvalles) and Roberto Tajonera (Tajonera), are Gregorias grandchildren or spouses thereof (Gregorias heirs).

In 1997, acting on the claim that one-half of subject property belonged to him as Romanas surviving heir, Leonardo filed with the Regional Trial Court (RTC) of Kalibo, Aklan Civil Case
No. 52756 for partition, recovery of ownership and possession, with damages, against Gregorias heirs. In his Amended Complaint,7 Leonardo alleged that on several occasions, he
demanded the partition of the property but Gregorias heirs refused to heed his demands; that the matter reached the level of the Lupon Tagapamayapa, which issued a certification to
file a court action sometime in 1980; that Gregorias heirs claimed sole ownership of the property; that portions of the property were sold to Tresvalles and Tajonera, which portions
must be collated and included as part of the portion to be awarded to Gregorias heirs; that in 1979, Lucimo Francisco, Sr. (Lucimo Sr.), husband of herein petitioner Teodora, illegally
claimed absolute ownership of the property and transferred in his name the tax declaration covering the property; that from 1988, Lucimo Sr. and Teodora have deprived him
(Leonardo) of the fruits of the property estimated atP1,000.00 per year; that as a result, he incurred expenses by way of attorneys fees and litigation costs. Leonardo thus prayed that
he be declared the owner of half of the subject property; that the same be partitioned after collation and determination of the portion to which he is entitled; that Gregorias heirs be
ordered to execute the necessary documents or agreements; and that he (Leonardo) be awarded actual damages in the amount of P1,000.00 per year from 1988, attorneys fees
of P50,000.00, and lawyers appearance fees of P500.00 per hearing.

In their Answer8 with counterclaim, Teodora, Camilo, Adolfo, Lucimo Jr. and Herminigildo claimed that Leonardo had no cause of action against them; that they have become the sole
owners of the subject property through Lucimo Sr. who acquired the same in good faith by sale from Juan Enriquez (Enriquez), who in turn acquired the same from Leon, and Leonardo
was aware of this fact; that they were in continuous, actual, adverse, notorious and exclusive possession of the property with a just title; that they have been paying the taxes on the
property; that Leonardos claim is barred by estoppel and laches; and that they have suffered damages and were forced to litigate as a result of Leonardos malicious suit. They prayed
that Civil Case No. 5275 be dismissed; that Leonardo be declared to be without any right to the property; that Leonardo be ordered to surrender the certificate of title to the property;
and that they be awarded P20,000.00 as moral damages, P10,000.00 as temperate and nominal damages, P20,000.00 as attorneys fees, and double costs.

The other Gregoria heirs, as well as Tresvalles and Tajonera were declared in default.9

As agreed during pre-trial, the trial court commissioned Geodetic Engineer Rafael M. Escabarte to identify the metes and bounds of the property.10 The resulting Commissioners
Report and Sketch,11 as well as the Supplementary Commissioners Report,12 were duly approved by the parties. The parties then submitted the following issues for resolution of the
trial court:

Whether Leonardo is entitled to a share in Leons estate;

Whether Leon sold the subject property to Lucimo Sr.; and

Whether Leonardos claim has prescribed, or that he is barred by estoppel or laches.13

In the meantime, Leonardo passed away and was duly substituted by his heirs, the respondents herein.14

During the course of the proceedings, the following additional relevant facts came to light:

1. In 1995, Leonardo filed against petitioners Civil Case No. 4983 for partition with the RTC Kalibo, but the case was dismissed and referred to the Kalibo Municipal Trial
Court (MTC), where the case was docketed as Civil Case No. 1366. However, on March 4, 1997, the MTC dismissed Civil Case No. 1366 for lack of jurisdiction and
declared that only the RTC can take cognizance of the partition case;15

2. The property was allegedly sold by Leon to Enriquez through an unnotarized document dated April 4, 1943.16 Enriquez in turn allegedly sold the property to Lucimo Sr.
on November 25, 1943 via another private sale document;17

3. Petitioners were in sole possession of the property for more than 30 years, while Leonardo acquired custody of OCT RO-630;18

4. On February 9, 1979, Lucimo Sr. executed an Affidavit of Ownership of Land19 claiming sole ownership of the property which he utilized to secure in his name Tax
Declaration No. 16414 (TD 16414) over the property and to cancel Tax Declaration No. 20102 in Leons name;20

5. Lucimo Sr. died in 1991; and

6. The property was partitioned among the petitioners, to the exclusion of Leonardo.21

Ruling of the Regional Trial Court

On November 19, 2001, the trial court rendered a Decision,22 which decreed as follows:

WHEREFORE, premises considered, judgment is hereby rendered:

Dismissing the complaint on the ground that plaintiffs right of action has long prescribed under Article 1141 of the New Civil Code;

Declaring Lot 1786 covered by OCT No. RO-630 (24071) to be the common property of the heirs of Gregoria Roldan Ining and by virtue whereof, OCT No. RO-630 (24071) is ordered
cancelled and the Register of Deeds of the Province of Aklan is directed to issue a transfer certificate of title to the heirs of Natividad Ining, one-fourth (1/4) share; Heirs of Dolores Ining,
one-fourth (1/4) share; Heirs of Antipolo Ining, one-fourth (1/4) share; and Heirs of Pedro Ining, one-fourth (1/4) share.

For lack of sufficient evidence, the counterclaim is ordered dismissed.

With cost against the plaintiffs.

SO ORDERED.23

The trial court found the April 4, 1943 and November 25, 1943 deeds of sale to be spurious. It concluded that Leon never sold the property to Enriquez, and in turn, Enriquez never sold
the property to Lucimo Sr., hence, the subject property remained part of Leons estate at the time of his death in 1962. Leons siblings, Romana and Gregoria, thus inherited the subject
property in equal shares. Leonardo and the respondents are entitled to Romanas share as the latters successors.

However, the trial court held that Leonardo had only 30 years from Leons death in 1962 or up to 1992 within which to file the partition case. Since Leonardo instituted the partition
suit only in 1997, the same was already barred by prescription. It held that under Article 1141 of the Civil Code,24 an action for partition and recovery of ownership and possession of a
parcel of land is a real action over immovable property which prescribes in 30 years. In addition, the trial court held that for his long inaction, Leonardo was guilty of laches as well.
Consequently, the property should go to Gregorias heirs exclusively.

Respondents moved for reconsideration25 but the same was denied by the RTC in its February 7, 2002 Order.26

Ruling of the Court of Appeals

Only respondents interposed an appeal with the CA. Docketed as CA-G.R. CV No. 74687, the appeal questioned the propriety of the trial courts dismissal of Civil Case No. 5275, its
application of Article 1141, and the award of the property to Gregorias heirs exclusively.

On March 14, 2006, the CA issued the questioned Decision,27 which contained the following decretal portion:

IN LIGHT OF ALL THE FOREGOING, this appeal is GRANTED. The decision of the Regional Trial Court, Br. 8, Kalibo, Aklan in Civil Case No. 5275 is REVERSED and SET ASIDE. In
lieu thereof, judgment is rendered as follows:

1. Declaring 1/2 portion of Lot 1786 as the share of the plaintiffs as successors-in-interest of Romana Roldan;

2. Declaring 1/2 portion of Lot 1786 as the share of the defendants as successors-in-interest of Gregoria Roldan Ining;

3. Ordering the defendants to deliver the possession of the portion described in paragraphs 8 and 9 of the Commissioners Report (Supplementary) to the herein plaintiffs;

4. Ordering the cancellation of OCT No. RO-630 (24071) in the name of Leon Roldan and the Register of Deeds of Aklan is directed to issue transfer certificates of title to
the plaintiffs in accordance with paragraphs 8 and 9 of the sketch plan as embodied in the Commissioners Report (Supplementary) and the remaining portion thereof be
adjudged to the defendants.

Other claims and counterclaims are dismissed.

Costs against the defendants-appellees.

SO ORDERED.28

The CA held that the trial courts declaration of nullity of the April 4, 1943 and November 25, 1943 deeds of sale in favor of Enriquez and Lucimo Sr., respectively, became final and was
settled by petitioners failure to appeal the same. Proceeding from the premise that no valid prior disposition of the property was made by its owner Leon and that the property which

remained part of his estate at the time of his death passed on by succession to his two siblings, Romana and Gregoria, which thus makes the parties herein who are Romanas and
Gregorias heirs co-owners of the property in equal shares, the appellate court held that only the issues of prescription and laches were needed to be resolved.

The CA did not agree with the trial courts pronouncement that Leonardos action for partition was barred by prescription. The CA declared that prescription began to run not from Leons
death in 1962, but from Lucimo Sr.s execution of the Affidavit of Ownership of Land in 1979, which amounted to a repudiation of his co-ownership of the property with Leonardo.
Applying the fifth paragraph of Article 494 of the Civil Code, which provides that "[n]o prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as
he expressly or impliedly recognizes the co-ownership," the CA held that it was only when Lucimo Sr. executed the Affidavit of Ownership of Land in 1979 and obtained a new tax
declaration over the property (TD 16414) solely in his name that a repudiation of his co-ownership with Leonardo was made, which repudiation effectively commenced the running of the
30-year prescriptive period under Article 1141.

The CA did not consider Lucimo Sr.s sole possession of the property for more than 30 years to the exclusion of Leonardo and the respondents as a valid repudiation of the coownership either, stating that his exclusive possession of the property and appropriation of its fruits even his continuous payment of the taxes thereon while adverse as against
strangers, may not be deemed so as against Leonardo in the absence of clear and conclusive evidence to the effect that the latter was ousted or deprived of his rights as co-owner with
the intention of assuming exclusive ownership over the property, and absent a showing that this was effectively made known to Leonardo. Citing Bargayo v. Camumot29 and Segura v.
Segura,30 the appellate court held that as a rule, possession by a co-owner will not be presumed to be adverse to the other co-owners but will be held to benefit all, and that a co-owner
or co-heir is in possession of an inheritance pro-indiviso for himself and in representation of his co-owners or co-heirs if he administers or takes care of the rest thereof with the
obligation to deliver the same to his co-owners or co-heirs, as is the case of a depositary, lessee or trustee.

The CA added that the payment of taxes by Lucimo Sr. and the issuance of a new tax declaration in his name do not prove ownership; they merely indicate a claim of ownership.
Moreover, petitioners act of partitioning the property among themselves to the exclusion of Leonardo cannot affect the latter; nor may it be considered a repudiation of the co-ownership
as it has not been shown that the partition was made known to Leonardo.

The CA held further that the principle of laches cannot apply as against Leonardo and the respondents. It held that laches is controlled by equitable considerations and it cannot be
used to defeat justice or to perpetuate fraud; it cannot be utilized to deprive the respondents of their rightful inheritance.

On the basis of the above pronouncements, the CA granted respondents prayer for partition, directing that the manner of partitioning the property shall be governed by the
Commissioners Report and Sketch and the Supplementary Commissioners Report which the parties did not contest.

Petitioners filed their Motion for Reconsideration31 which the CA denied in its assailed September 7, 2006 Resolution.32 Hence, the present Petition.

Issues

Petitioners raise the following arguments:

THE APPELLATE COURT COMMITTED GRAVE ABUSE OF DISCRETION IN REVERSING THE DECISION OF THE TRIAL COURT ON THE GROUND THAT
LUCIMO FRANCISCO REPUDIATED THE CO-OWNERSHIP ONLY ON FEBRUARY 9, 1979.

II

THE APPELLATE COURT ERRED IN NOT UPHOLDING THE DECISION OF THE TRIAL COURT DISMISSING THE COMPLAINT ON THE GROUND OF
PRESCRIPTION AND LACHES.33

Petitioners Arguments

Petitioners insist in their Petition and Reply34 that Lucimo Sr.s purchase of the property in 1943 and his possession thereof amounted to a repudiation of the co-ownership, and that
Leonardos admission and acknowledgment of Lucimo Sr.s possession for such length of time operated to bestow upon petitioners as Lucimo Sr.s successors-in-interest the
benefits of acquisitive prescription which proceeded from the repudiation.

Petitioners contend that Leonardos inaction from Lucimo Sr.s taking possession in 1943, up to 1995, when Leonardo filed Civil Case No. 4983 for partition with the RTC Kalibo
amounted to laches or neglect. They add that during the proceedings before the Lupon Tagapamayapa in 1980, Leonardo was informed of Lucimo Sr.s purchase of the property in
1943; this notwithstanding, Leonardo did not take action then against Lucimo Sr. and did so only in 1995, when he filed Civil Case No. 4983 which was eventually dismissed and
referred to the MTC. They argue that, all this time, Leonardo did nothing while Lucimo Sr. occupied the property and claimed all its fruits for himself.

Respondents Arguments

Respondents, on the other hand, argue in their Comment35 that

For purposes of clarity, if [sic] is respectfully submitted that eighteen (18) legible copies has [sic] not been filed in this case for consideration in banc [sic] and nine (9) copies in cases
heard before a division in that [sic] all copies of pleadings served to the offices concern [sic] where said order [sic] was issued were not furnished two (2) copies each in violation to [sic]
the adverse parties [sic] to the clerk of court, Regional Trial Court, Branch 8, Kalibo, Aklan, Philippines; to the Honorable Court of Appeals so that No [sic] action shall be taken on such
pleadings, briefs, memoranda, motions, and other papers as fail [sic] to comply with the requisites set out in this paragraph.

The foregoing is confirmed by affidavit of MERIDON F. OLANDESCA, the law secretary of the Petitioner [sic] who sent [sic] by Registered mail to Court of Appeals, Twentieth Division,
Cebu City; to Counsel for Respondent [sic] and to the Clerk of Court Supreme Court Manila [sic].

These will show that Petitioner has [sic] violated all the requirements of furnishing two (2) copies each concerned party [sic] under the Rule of Courts [sic].36

Our Ruling

The Court denies the Petition.

The finding that Leon did not sell the property to Lucimo Sr. had long been settled and had become final for failure of petitioners to appeal. Thus, the property remained part of Leons
estate.

One issue submitted for resolution by the parties to the trial court is whether Leon sold the property to Lucimo Sr.1wphi1The trial court, examining the two deeds of sale executed in
favor of Enriquez and Lucimo Sr., found them to be spurious. It then concluded that no such sale from Leon to Lucimo Sr. ever took place. Despite this finding, petitioners did not
appeal. Consequently, any doubts regarding this matter should be considered settled. Thus, petitioners insistence on Lucimo Sr.s 1943 purchase of the property to reinforce their claim
over the property must be ignored. Since no transfer from Leon to Lucimo Sr. took place, the subject property clearly remained part of Leons estate upon his passing in 1962.

Leon died without issue; his heirs are his siblings Romana and Gregoria.

Since Leon died without issue, his heirs are his siblings, Romana and Gregoria, who thus inherited the property in equal shares. In turn, Romanas and Gregorias heirs the parties
herein became entitled to the property upon the sisters passing. Under Article 777 of the Civil Code, the rights to the succession are transmitted from the moment of death.

Gregorias and Romanas heirs are co-owners of the subject property.

Thus, having succeeded to the property as heirs of Gregoria and Romana, petitioners and respondents became co-owners thereof. As co-owners, they may use the property owned in
common, provided they do so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of the co-ownership or prevent the other co-owners
from using it according to their rights.37 They have the full ownership of their parts and of the fruits and benefits pertaining thereto, and may alienate, assign or mortgage them, and
even substitute another person in their enjoyment, except when personal rights are involved.38 Each co-owner may demand at any time the partition of the thing owned in common,
insofar as his share is concerned.39 Finally, no prescription shall run in favor of one of the co-heirs against the others so long as he expressly or impliedly recognizes the coownership.40

For prescription to set in, the repudiation must be done by a co-owner.

Time and again, it has been held that "a co-owner cannot acquire by prescription the share of the other co-owners, absent any clear repudiation of the co-ownership. In order that the
title may prescribe in favor of a co-owner, the following requisites must concur: (1) the co-owner has performed unequivocal acts of repudiation amounting to an ouster of the other coowners; (2) such positive acts of repudiation have been made known to the other co-owners; and (3) the evidence thereof is clear and convincing."41

From the foregoing pronouncements, it is clear that the trial court erred in reckoning the prescriptive period within which Leonardo may seek partition from the death of Leon in 1962.
Article 1141 and Article 494 (fifth paragraph) provide that prescription shall begin to run in favor of a co-owner and against the other co-owners only from the time he positively
renounces the co-ownership and makes known his repudiation to the other co-owners.

Lucimo Sr. challenged Leonardos co-ownership of the property only sometime in 1979 and 1980, when the former executed the Affidavit of Ownership of Land, obtained a new tax
declaration exclusively in his name, and informed the latter before the Lupon Tagapamayapa of his 1943 purchase of the property. These apparent acts of repudiation were followed
later on by Lucimo Sr.s act of withholding Leonardos share in the fruits of the property, beginning in 1988, as Leonardo himself claims in his Amended Complaint. Considering these
facts, the CA held that prescription began to run against Leonardo only in 1979 or even in 1980 when it has been made sufficiently clear to him that Lucimo Sr. has renounced the
co-ownership and has claimed sole ownership over the property. The CA thus concluded that the filing of Civil Case No. 5275 in 1997, or just under 20 years counted from 1979, is
clearly within the period prescribed under Article 1141.

What escaped the trial and appellate courts notice, however, is that while it may be argued that Lucimo Sr. performed acts that may be characterized as a repudiation of the coownership, the fact is, he is not a co-owner of the property. Indeed, he is not an heir of Gregoria; he is merely Antipolos son-in-law, being married to Antipolos daughter
Teodora.42 Under the Family Code, family relations, which is the primary basis for succession, exclude relations by affinity.

Art. 150. Family relations include those:

(1) Between husband and wife;

(2) Between parents and children;

(3) Among other ascendants and descendants; and

(4) Among brothers and sisters, whether of the full or half blood.

In point of law, therefore, Lucimo Sr. is not a co-owner of the property; Teodora is. Consequently, he cannot validly effect a repudiation of the co-ownership, which he was never part of.
For this reason, prescription did not run adversely against Leonardo, and his right to seek a partition of the property has not been lost.

Likewise, petitioners argument that Leonardos admission and acknowledgment in his pleadings that Lucimo Sr. was in possession of the property since 1943 should be taken
against him, is unavailing. In 1943, Leon remained the rightful owner of the land, and Lucimo Sr. knew this very well, being married to Teodora, daughter of Antipolo, a nephew of Leon.
More significantly, the property, which is registered under the Torrens system and covered by OCT RO-630, is in Leons name. Leons ownership ceased only in 1962, upon his death
when the property passed on to his heirs by operation of law.

In fine, since none of the co-owners made a valid repudiation of the existing co-ownership, Leonardo could seek partition of the property at any time.

WHEREFORE, the Petition is DENIED. The assailed March 14, 2006 Decision and the September 7, 2006 Resolution of the Court of Appeals in CA-G.R. CV No. 74687are AFFIRMED.

SO ORDERED.

22. G.R. No. 187944, March 12, 2014

CARMENCITA SUAREZ, Petitioner, v. MR. AND MRS. FELIX E. EMBOY, JR. AND MARILOU P. EMBOYDELANTAR, Respondents.

DECISION

REYES, J.:

For review in the instant Petition1 is the Decision2 rendered on March 19, 2009 and Resolution3 issued on May 5, 2009 by the Court of Appeals (CA) in CAG.R. SP No. 03489. The
CA granted the Petition for Review4 filed by Mr. and Mrs. Felix Emboy, Jr. (Felix) and Marilou EmboyDelantar (Marilou) (respondents), seeking to reverse the decisions of the Regional
Trial Court (RTC), Branch 12,5 and Municipal Trial Court in Cities (MTCC), Branch 3,6 of Cebu City, rendered on February 26, 2008 in Civil Case No. CEB33328,7 and on
September 25, 2006 in Civil Case No. R49832, respectively. The RTC affirmed the MTCC in upholding the claims of Carmencita Suarez (Carmencita) in her complaint for unlawful
detainer instituted against the respondents.

Antecedents
At the center of the dispute is a 222square meter parcel of land, designated as Lot No. 1907A2 (subject lot) of the subdivision plan Psd165686, situated in Barangay Duljo,
Cebu City, and covered by Transfer Certificate of Title (TCT) No. T174880 issued in the name of Carmencita on February 9, 2005. The subject lot used to be a part of Lot No. 1907
A,8 which was partitioned in the following manner among the heirs of Spouses Carlos Padilla (Carlos) and Asuncion Pacres (Asuncion):9

Lot No.

TCT No.

1907A1

T54359

Spouses Rogelio and Praxedes Padilla

Heirs

1907A2

T54360

Heirs of Vicente Padilla (Vicente), namely: (1) Azucena Padilla, married to Felly Carrera; (2)
Remedios Padilla (Remedios), married to Oscar Dimay; (3) Veronica Padilla
(Veronica);10 and (4) Moreno Padilla (Moreno), married to Teresita Curso (Teresita)

1907A3

T54361

Cresencio Padilla

1907A4

T54362

Fructousa Baricuatro

1907A5

T54363

Claudia PadillaEmboy (Claudia)

A house, which is occupied by respondents Felix and Marilou, stands in the subject lot. The respondents claim that their mother, Claudia, had occupied the subject lot during her
lifetime and it was earmarked to become her share in Lot No. 1907A. They had thereafter stayed in the subject lot for decades after inheriting the same from Claudia, who had in turn
succeeded her own parents, Carlos and Asuncion.11
In 2004, respondents Felix and Marilou were asked by their cousins, who are the Heirs of Vicente, to vacate the subject lot and to transfer to Lot No. 1907A5, a landlocked
portion sans a right of way. They refused to comply insisting that Claudias inheritance pertained to Lot No. 1907A2.12
Not long after, the respondents received from Carmencitas counsel, Atty. Jufelenito R. Pareja (Atty. Pareja), a demand letter, dated February 23, 2004, requiring them to vacate the
subject lot. They were informed that Carmencita had already purchased on February 12, 2004 the subject lot from the formers relatives. However, the respondents did not heed the
demand. Instead, they examined the records pertaining to the subject lot and uncovered possible anomalies, i.e., forged signatures and alterations, in the execution of a series of
deeds of partition relative to Lot No. 1907A. On August 13, 2004, they filed before the RTC of Cebu City a complaint13 for nullification of the partition and for the issuance of new
TCTs covering the heirs respective portions of Lot No. 1907A.14
On December 8, 2004, Carmencita filed before the MTCC and against the respondents a complaint for unlawful detainer, the origin of the instant petition. She alleged that she bought
the subject lot from Remedios, Moreno, Veronica and Dionesia,15 the registered owners thereof and the persons who allowed the respondents to occupy the same by mere tolerance.
As their successorininterest, she claimed her entitlement to possession of the subject lot and the right to demand from the respondents to vacate the same.16
The MTCC upheld Carmencitas claims in its decision rendered on September 25, 2006. The respondents were ordered to vacate the subject lot and remove at their expense all the

improvements they had built thereon. They were likewise made solidarily liable to pay Carmencita Php 20,000.00 as attorneys fees.17
In the Decision dated February 26, 2008, the RTC affirmed in its entirety the MTCC ruling.18
The respondents challenged the MTCC and RTC judgments through a Petition for Review19 filed before the CA.
The respondents argued that they have been occupying the subject lot in the concept of owners for several decades. Carmencita, on the other hand, was a buyer in bad faith for having
purchased the property despite the notice of lis pendens clearly annotated on the subject lots title. Even her complaint for unlawful detainer was filed on December 8, 2004 subsequent
to the respondents institution on August 13, 2004 of a petition for nullification of the partition. Citing Sarmiento v. CA,20the respondents emphasized that even if one is the owner of
the property, the possession thereof cannot be wrested from another who had been in the physical or material possession of the same for more than one year by resorting to a
summary action of ejectment.21 The respondents also invoked the doctrine enunciated in Amagan v. Marayag22 that the pendency of another action anchored on the issue of
ownership justifies the suspension of an ejectment suit involving the same real property. The foregoing is especially true in the case at bar where the issue of possession is so
interwoven with that of ownership. Besides, the resolution of the question of ownership would necessarily result in the disposition of the issue of possession.
The respondents also stressed that the deed of sale dated April 1, 2004, which was attached to the complaint for unlawful detainer, bore telltale signs of being spurious. First, Atty.
Parejas demand letter sent to the respondents instead referred to a deed of sale dated February 12, 2004. Secondly, Teresita, who now lives in Luzon and has been estranged from
Moreno since the 1980s, was a signatory in the deed of sale. Thirdly, a certain Veronida Padilla, a fictitious person, also signed the deed of sale as among the vendors, but she, too,
was impleaded as a codefendant in the ejectment suit. Fourthly, the deed was only registered the following year after its supposed execution.
The respondents insisted that the Heirs of Vicente, who had allegedly sold the subject lot to Carmencita, had never physically occupied the same. Hence, there was no basis at all for
Carmencitas claim that the respondents possession of the subject lot was by mere tolerance of the alleged owners.
The respondents also presented before the CA a newly discovered evidence, which they found in an old wooden chest in their ancestral home. A duly notarized document captioned as
an Agreement,23 dated February 23, 1957, showed that Vicente and his spouse, Dionesia, had waived their hereditary rights to Lot No. 1907A. The document stated that Vicente
obtained a loan from the Philippine National Bank using Lot No. 1907A as a collateral. The loan was paid by Carlos and Asuncion and the waiver must have been executed in order to
be fair to Vicentes siblings. Prescinding from the above, the Heirs of Vicente no longer had ownership rights over the subject lot to convey to Carmencita.
The respondents also averred that Carmencitas complaint lacked a cause of action. The certification to file an action was issued by the officials of Barangay Duljo in the name of
James Tan Suarez, Carmencitas brother, who had no real rights or interests over the subject lot. Further, while Carmencita based her claim over the subject lot by virtue of a deed of
sale executed on April 1, 2004, no demand to vacate was made upon the respondents after that date. The absence of such demand rendered the complaint fatally defective, as the
date of its service should be the reckoning point of the oneyear period within which the suit can be filed.
In support of the respondents prayer for the issuance of injunctive reliefs, they argued that their loss would be irreparable. Moreover, the resolution of the respondents petition for
nullification of the partition of Lot No. 1907A, in which Carmencita was likewise impleaded as a defendant, would be rendered useless in the event that the latters complaint for
unlawful detainer would be granted and the formers ancestral house demolished.

The Ruling of the CA

On March 19, 2009, the CA rendered the herein assailed Decision reversing the disquisitions of the courts a quo and dismissing Carmencitas complaint for unlawful detainer. The CA
explained:chanRoblesvirtualLawlibrary

Section 1, Rule 70 of the Rules of Court provides:

Section 1. Who may institute proceedings, and when.Subject to the provisions of the next succeeding section, a person deprived of the possession of any land or building by force,
intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person against whom the possession of any land or building is unlawfully withheld after the expiration or
termination of the right to hold possession, by virtue of any contract, express or implied, or the legal representatives or assigns of any such lessor, vendor, vendee, or other person,
may, at any time within one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper Municipal Trial Court against the person or persons
unlawfully withholding or depriving of possession, or any person or persons claiming under them, for the restitution of such possession, together with damages and costs.
The distinction between forcible entry and unlawful detainer was lucidly explained inSarmiento vs. Court of Appeals,:
Forcible entry and unlawful detainer cases are two distinct actions defined in Section 1, Rule 70 of the Rules of Court. [In] forcible entry, one is deprived of physical possession of land
or building by means of force, intimidation, threat, strategy, or stealth. In unlawful detainer, one unlawfully withholds possession thereof after the expiration or termination of his right to

hold possession under any contract, express or implied. In forcible entry, the possession is illegal from the beginning and the basic inquiry centers on who has the prior possession de
facto. In unlawful detainer, the possession was originally lawful but became unlawful by the expiration or termination of the right to possess, hence the issue of rightful possession is
decisive for, in such action, the defendant is in actual possession and the plaintiffs cause of action is the termination of the defendants right to continue in possession.
What determines the cause of action is the nature of defendants entry into the land. If the entry is illegal, then the action which may be filed against the intruder within one (1) year
therefrom is forcible entry. If, on the other hand, the entry is legal but the possession thereafter became illegal, the case is one of unlawful detainer which must be filed within one (1)
year from the date of the last demand.
A close perusal of [Carmencitas] complaint a quo reveals that the action was neither one of forcible entry nor unlawful detainer but essentially involved an issue of ownership which
must be resolved in an accion reivindicatoria. It did not characterize [the respondents] alleged entry into the land: whether the same was legal or illegal. It did not state how [the
respondents] entered the land and constructed a house thereon. It was also silent on whether [the respondents] possession became legal before [Carmencita] demanded from them to
vacate the land. The complaint merely averred that their relatives previously owned the lot [the respondents] were occupying and that after [Carmencita] purchased it[,] she, as its new
owner, demanded [for the respondents] to vacate the land. Moreover, it is undisputed that [the respondents] and their ancestors have been occupying the land for several decades
already. There was no averment as to how or when [Carmencitas] predecessors tolerated [the respondents] possession of the land. Consequently, there was no contract to speak of,
whether express or implied, between [the respondents], on one hand, and [Carmencita] or her predecessors, on the other, as would qualify [the respondents] possession of the land as
a case of unlawful detainer. Neither was it alleged that [the respondents] took possession of the land through force, intimidation, threat, strategy or stealth to make out a case of forcible
entry. In any event, [Carmencita] cannot legally assert that [the respondents] possession of the land was by mere tolerance. This is because [Carmencitas] predecessorsininterest
did not yet own the property when [Claudia] took possession thereof. Take note that [Carmencitas] predecessorsininterest merely stepped into the shoes of their parents who were
also coheirs of [Claudia]. Finally, to categorize a cause of action as one constitutive of unlawful detainer, plaintiffs supposed acts of tolerance must have been present from the start
of the possession which he later seek[s] to recover. This is clearly wanting in the case at bar.
Indeed, when the complaint fails to aver facts constitutive of forcible entry or unlawful detainer, as where it does not state how entry was effected or how and when dispossession
started, as in the case at bar, the remedy should either be an accionpubliciana or an accion reivindicatoria in the proper RTC. If [Carmencita] is truly the owner of the subject property
and she was unlawfully deprived of the real right of possession or ownership thereof, she should present her claim before the RTC in an accion publiciana or an accion
reivindicatoria, and not before the municipal trial court in a summary proceeding of unlawful detainer or forcible entry.
Munoz vs. Court of Appeals enunciated:
For even if he is the owner, possession of the property cannot be wrested from another who had been in possession thereof for more than twelve (12) years through a summary action
for ejectment. Although admittedly[,] petitioner may validly claim ownership based on the muniments of title it presented, such evidence does not responsibly address the issue of prior
actual possession raised in a forcible entry case. It must be stated that regardless of actual condition of the title to the property, the party in peaceable quiet possession shall not be
turned out by a strong hand, violence or terror. Thus, a party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the
character of his prior possession, if he has in his favor priority in time, he has the security that entitles him to remain on the property until he is lawfully ejected by a person having a
better right by accion publiciana or accion reivindicatoria.24 (Citations omitted and underscoring supplied)
In Carmencitas Motion for Reconsideration25 filed before the CA, she alleged that the case of Sarmientocited by the respondents is not applicable to the present controversy since it
involves a boundary dispute, which is properly the subject of an accion reivindicatoria and over which the MTCC has no jurisdiction. She claimed that Rivera v. Rivera26 finds more
relevance in the case at bar. In Rivera, the contending parties were each others relatives and the Court ruled that in an unlawful detainer case, prior physical possession by the
complainant is not necessary.27 Instead, what is required is a better right of possession. Further, the MTCC cannot be divested of jurisdiction just because the defendants assert
ownership over the disputed property.
In the herein assailed Resolution dated May 5, 2009, the CA denied Carmencitas Motion for Reconsideration.
In essence, the instant petition presents the following issues:

I
Whether or not Carmencitas complaint against the respondents had sufficiently alleged and proven a cause of action for unlawful detainer.

II

Whether or not the pendency of the respondents petition for nullification of partition of Lot No. 1907A and for the issuance of new certificates of title can abate Carmencitas ejectment
suit.
Carmencitas Allegations
In support of the petition, Carmencita reiterates that she purchased the subject lot from the Heirs of Vicente, who were then the registered owners thereof. At the time of the sale,
respondents Felix and Marilou were occupying the subject lot. Thus, Atty. Pareja, in Carmencitas behalf, demanded that they vacate the property. The respondents refusal to comply
with the demand turned them into deforciants unlawfully withholding the possession of the subject lot from Carmencita, the new owner, whose recourse was to file a complaint for
unlawful detainer.
Further, Carmencita insists that a certificate of title shall not be subject to a collateral attack28 and the issue of ownership cannot be resolved in an action for unlawful detainer. A
pending suit involving the question of ownership of a piece of real property will not abate an ejectment complaint as the two are not based on the same cause of action and are seeking
different reliefs.29
Additionally, Carmencita invokes the doctrine in Eastern Shipping Lines, Inc. v. CA30 that the registered owner of a property is entitled to its possession. In Arcal v. CA,31 the Court
also explained that the occupation of a property not by its registered owner but by others depends on the formers tolerance, and the occupants are bound by an implied promise to
vacate upon demand, failing at which, a suit for ejectment would be proper.32

The Respondents Arguments

In their Comment33 to the instant petition, the respondents stress that Carmencitas complaint for unlawful detainer was fundamentally inadequate. There was practically no specific
averment as to when and how possession by tolerance of the respondents began. In the complaint, Carmencita made a general claim that the respondents possessed the property by
mere tolerance with the understanding that they would voluntarily vacate the premises and remove their house(s) thereon upon demand by the owners.34 In Spouses Valdez, Jr. v.
CA,35 the Court ruled that the failure of the complainants to allege key jurisdictional facts constitutive of unlawful detainer is fatal and deprives the MTCC of jurisdiction over the action.
In their rejoinder,36 the respondents likewise argue that the issues of possession and ownership are inseparably linked in the case at bar. Carmencitas complaint for ejectment was
based solely on her spurious title, which is already the subject of the respondents petition for nullification of partition of Lot No. 1907A.

Our Disquisition
The instant petition lacks merit.
Carmencita had not amply alleged
and proven that all the requisites for
unlawful detainer are present in the
case at bar.
Without a doubt, the registered owner of real property is entitled to its possession. However, the owner cannot simply wrest possession thereof from whoever is in actual occupation of
the property. To recover possession, he must resort to the proper judicial remedy and, once he chooses what action to file, he is required to satisfy the conditions necessary for such
action to prosper.37
In Spouses Valdez, Jr.,38 the Court is instructive anent the three kinds of actions available to recover possession of real property, viz:chanRoblesvirtualLawlibrary

(a) accion interdictal; (b) accion publiciana; and (c) accion reivindicatoria.
Accion interdictal comprises two distinct causes of action, namely, forcible entry (detentacion) and unlawful detainer (desahuico) [sic]. In forcible entry, one is deprived of physical
possession of real property by means of force, intimidation, strategy, threats, or stealth whereas in unlawful detainer, one illegally withholds possession after the expiration or
termination of his right to hold possession under any contract, express or implied. The two are distinguished from each other in that in forcible entry, the possession of the defendant is

illegal from the beginning, and that the issue is which party has prior de facto possession while in unlawful detainer, possession of the defendant is originally legal but became illegal
due to the expiration or termination of the right to possess.
The jurisdiction of these two actions, which are summary in nature, lies in the proper municipal trial court or metropolitan trial court. Both actions must be brought within one year from
the date of actual entry on the land, in case of forcible entry, and from the date of last demand, in case of unlawful detainer. The issue in said cases is the right to physical possession.
Accion publiciana is the plenary action to recover the right of possession which should be brought in the proper regional trial court when dispossession has lasted for more than one
year. It is an ordinary civil proceeding to determine the better right of possession of realty independently of title. In other words, if at the time of the filing of the complaint more than one
year had elapsed since defendant had turned plaintiff out of possession or defendants possession had become illegal, the action will be, not one of the forcible entry or illegal detainer,
but an accion publiciana. On the other hand, accion reivindicatoria is an action to recover ownership also brought in the proper regional trial court in an ordinary civil
proceeding.39 (Citations omitted)
In a complaint for unlawful detainer, the following key jurisdictional facts must be alleged and sufficiently established:chanRoblesvirtualLawlibrary

(1)

initially, possession of property by the defendant was by contract with or by tolerance of the plaintiff;

(2)

eventually, such possession became illegal upon notice by plaintiff to defendant of the termination of the latters right of possession;

(3)

thereafter, the defendant remained in possession of the property and deprived the plaintiff of the enjoyment thereof; and

(4)

within one year from the last demand on defendant to vacate the property, the plaintiff instituted the complaint for ejectment.40

In the case at bar, the first requisite mentioned above is markedly absent. Carmencita failed to clearly allege and prove how and when the respondents entered the subject lot and
constructed a house upon it.41 Carmencita was likewise conspicuously silent about the details on who specifically permitted the respondents to occupy the lot, and how and when such
tolerance came about.42 Instead, Carmencita cavalierly formulated a legal conclusion, sans factual substantiation, that (a) the respondents initial occupation of the subject lot was
lawful by virtue of tolerance by the registered owners, and (b) the respondents became deforciants unlawfully withholding the subject lots possession after Carmencita, as purchaser
and new registered owner, had demanded for the former to vacate the property.43 It is worth noting that the absence of the first requisite assumes even more importance in the light of
the respondents claim that for decades, they have been occupying the subject lot as owners thereof.
Again, this Court stresses that to give the court jurisdiction to effect the ejectment of an occupant or deforciant on the land, it is necessary that the complaint must sufficiently show such
a statement of facts as to bring the party clearly within the class of cases for which the statutes provide a remedy, without resort to parol testimony, as these proceedings are summary
in nature. In short, the jurisdictional facts must appear on the face of the complaint. When the complaint fails to aver facts constitutive of forcible entry or unlawful detainer, as where it
does not state how entry was effected or how and when dispossession started, the remedy should either be an accion publiciana or accion reivindicatoria.44
As an exception to the general rule, the respondents petition for nullification of the partition of Lot No. 1907A can abate Carmencitas suit for unlawful detainer.
In Amagan, the Court is emphatic that:chanRoblesvirtualLawlibrary

As a general rule, therefore, a pending civil action involving ownership of the same property does not justify the suspension of ejectment proceedings. The underlying reasons for the
above ruling were that the actions in the Regional Trial Court did not involve physical or de facto possession, and, on not a few occasions, that the case in the Regional Trial Court was
merely a ploy to delay disposition of the ejectment proceeding, or that the issues presented in the former could quite as easily be set up as defenses in the ejectment action and there
resolved.
Only in rare instances is suspension allowed to await the outcome of the pending civil action. One such exception is Vda. de Legaspi v. Avendao, wherein the Court
declared:chanRoblesvirtualLawlibrary

x x x. Where the action, therefore, is one of illegal detainer, as distinguished from one of forcible entry, and the right of the plaintiff to recover the premises is seriously placed in issue
in a proper judicial proceeding, it is more equitable and just and less productive of confusion and disturbance of physical possession, with all its concomitant inconvenience and
expenses. For the Court in which the issue of legal possession, whether involving ownership or not, is brought to restrain, should a petition for preliminary injunction be filed with it, the
effects of any order or decision in the unlawful detainer case in order to await the final judgment in the more substantive case involving legal possession or ownership. It is only where
there has been forcible entry that as a matter of public policy the right to physical possession should be immediately set at rest in favor of the prior possession regardless of the fact that

the other party might ultimately be found to have superior claim to the premises involved, thereby to discourage any attempt to recover possession thru force, strategy or stealth and
without resorting to the courts.
xxxx
Indisputably, the execution of the MCTC Decision would have resulted in the demolition of the house subject of the ejectment suit; thus, by parity of reasoning, considerations of equity
require the suspension of the ejectment proceedings. We note that, like Vda. de Legaspi, the respondents suit is one of unlawful detainer and not of forcible entry. And most certainly,
the ejectment of petitioners would mean a demolition of their house, a matter that is likely to create the confusion, disturbance, inconveniences and expenses mentioned in the said
exceptional case.
Necessarily, the affirmance of the MCTC Decision would cause the respondent to go through the whole gamut of enforcing it by physically removing the petitioners from the premises
they claim to have been occupying since 1937. (Respondent is claiming ownership only of the land, not of the house.) Needlessly, the litigants as well as the courts will be wasting
much time and effort by proceeding at a stage wherein the outcome is at best temporary, but the result of enforcement is permanent, unjust and probably irreparable.
We should stress that respondents claim to physical possession is based not on an expired or a violated contract of lease, but allegedly on mere tolerance. Without in any way
prejudging the proceedings for the quieting of title, we deem it judicious under the present exceptional circumstances to suspend the ejectment case.45 (Citations omitted)
The Court then quoted with favor the following portion of the Decision dated July 8, 1997, penned by Associate Justice Artemio G. Tuquero in CAG.R. No. 43611SP, from which
the Amagan case sprang:chanRoblesvirtualLawlibrary

ONE. Private respondent Teodorico T. Marayag anchors his action for unlawful detainer on the theory that petitioners possession of the property in question was by mere tolerance.
However, in answer to his demand letter dated April 13, 1996 x x x, petitioners categorically denied having any agreement with him, verbal or written, asserting that they are owners of
the premises we are occupying at 108 J.P. Rizal Street, San Vicente, Silang, Cavite. In other words, it is not merely physical possession but ownership as well that is involved in this
case.[]
TWO. In fact, to protect their rights to the premises in question, petitioners filed an action for reconveyance, quieting of title and damages against private respondents, docketed as Civil
Case No. TG1682 of the Regional Trial Court, Branch 18, Tagaytay City. The issue of ownership is squarely raised in this action. Undoubtedly, the resolution of this issue will be
determinative of who is entitled to the possession of the premises in question.[]
THREE. The immediate execution of the judgment in the unlawful detainer case will include the removal of the petitioners house [from] the lot in question.[]
To the mind of the Court it is injudicious, nay inequitable, to allow demolition of petitioners house prior to the determination of the question of ownership [of] the lot on which it
stands.46 (Citation omitted)
We find the doctrines enunciated in Amagan squarely applicable to the instant petition for reasons discussed hereunder.
Carmencitas complaint for unlawful detainer is anchored upon the proposition that the respondents have been in possession of the subject lot by mere tolerance of the owners. The
respondents, on the other hand, raise the defense of ownership of the subject lot and point to the pendency of Civil Case No. CEB30548, a petition for nullification of the partition
of Lot No. 1907A, in which Carmencita and the Heirs of Vicente were impleaded as parties. Further, should Carmencitas complaint be granted, the respondents house, which has
been standing in the subject lot for decades, would be subject to demolition. The foregoing circumstances, thus, justify the exclusion of the instant petition from the purview of the
general rule.
All told, we find no reversible error committed by the CA in dismissing Carmencitas complaint for unlawful detainer. As discussed above, the jurisdictional requirement of possession by
mere tolerance of the owners had not been amply alleged and proven. Moreover, circumstances exist which justify the abatement of the ejectment proceedings. Carmencita can
ventilate her ownership claims in an action more suited for the purpose. The respondents, on other hand, need not be exposed to the risk of having their house demolished pending the
resolution of their petition for nullification of the partition of Lot No. 1907A, where ownership over the subject lot is likewise presented as an issue.
IN VIEW OF THE FOREGOING, the instant petition is DENIED. The Decision rendered on March 19, 2009 and Resolution issued on May 5, 2009 by the Court of Appeals in CAG.R.
SP No. 03489 areAFFIRMED.

SO ORDERED.

23. G.R. No. 151334

February 13, 2013

CAROLINA (CARLINA) VDA. DE FIGURACION, HEIRS OF ELENA FIGURACION-ANCHETA, namely: LEONCIO ANCHETA, JR., and ROMULO ANCHETA, HEIRS OF HILARIA
A. FIGURACION, namely: FELIPA FIGURACION-MANUEL, MARY FIGURACION-GINEZ, and EMILIA FIGURACION-GERILLA, AND HEIRS OF QUINTIN FIGURACION, namely:
LINDA M. FIGURACION, LEANDRO M. FIGURACION, II, and ALLAN M. FIGURACION, Petitioners,
vs.
EMILIA FIGURACION-GERILLA, Respondent.

DECISION

REYES, J.:

At bar is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Court, assailing the Decision2 dated December 11, 2001 of the Court of Appeals (CA) in CA-G.R. CV No.
58290, which reversed and set aside the Decision3 dated June 26, 1997 of the Regional Trial Court (RTC) of Urdaneta, Pangasinan, Branch 49. The RTC decision (1) dismissed
respondent Emilia Figuracion-Gerillas (Emilia) complaint for partition, annulment of documents, reconveyance, quieting of title and damages, and (2) annulled the Affidavit of SelfAdjudicationexecuted by petitioner Carolina (Carlina) Vda. De Figuracion (Carolina).

The Facts

The parties are the heirs of Leandro Figuracion (Leandro) who died intestate in May 1958. Petitioner Carolina is the surviving spouse. The other petitioners Elena Figuracion-Ancheta,
Hilaria A. Figuracion (Hilaria), Felipa Figuracion-Manuel (Felipa), Quintin Figuracion, and Mary Figuracion-Ginez and respondent Emilia were Carolina and Leandros children.4

Subject of the dispute are two parcels of land both situated in Urdaneta, Pangasinan, which were acquired by Leandro during his lifetime. These properties were: (1) Lot No. 2299 with a
land area of 7,547 square meters originally covered by Transfer Certificate of Title (TCT) No. 4221-P;5 and (2) Lot No. 705 measuring 2,900 square meters and covered by TCT No.
4220-P. Both lands were registered in the name of "Leandro Figuracion married to Carolina Adviento". Leandro executed a Deed of Quitclaim over the above real properties in favor of
his six (6) children on August 23, 1955. Their shares, however, were not delineated with particularity because spouses Leandro and Carolina reserved the lots and its fruits for their
expenses.

Also involved in the controversy is Lot No. 707 of the Cadastral Survey of Urdaneta, Pangasinan, with an area of 3,164 square meters originally owned by Eulalio Adviento (Eulalio),
covered by Original Certificate of Title (OCT) No. 15867 issued in his name on August 21, 1917. Eulalio begot Agripina Adviento (Agripina) with his first wife Marcela Estioko (Marcela),
whom Eulalio survived. When he remarried, Eulalio had another daughter, herein petitioner Carolina, with his second wife, Faustina Escabesa (Faustina).6

On November 28, 1961, Agripina7 executed a Deed of Quitclaim8 over the eastern half of Lot No. 707 in favor of her niece, herein respondent Emilia.

Soon thereafter or on December 11, 1962, petitioner Carolina executed an Affidavit of Self-Adjudication9adjudicating unto herself the entire Lot No. 707 as the sole and exclusive heir of
her deceased parents, Eulalio and Faustina.10 On the same date, Carolina also executed a Deed of Absolute Sale11 over Lot No. 707 in favor of petitioners Hilaria and Felipa, who in
turn immediately caused the cancellation of OCT No. 15867 and the issuance of TCT No. 42244 in their names.12

In 1971, Emilia and her family went to the United States and returned to the Philippines only in 1981. Upon her return and relying on the Deed of Quitclaim, she built a house on the
eastern half of Lot No. 707.13

The legal debacle of the Figuracions started in 1994 when Hilaria and her agents threatened to demolish the house of Emilia who, in retaliation, was prompted to seek the partition of
Lot No. 707 as well as Lot Nos. 2299 and 705. The matter was initially brought before the Katarungang Pambarangay, but no amicable settlement was reached by the parties.14 On
May 23, 1994, respondent Emilia instituted the herein Complaint15 for the partition of Lot Nos. 2299, 705 and 707, annulment of the Affidavit of Self- Adjudication, Deed of Absolute
Sale and TCT No. 42244, reconveyance of eastern half portion of Lot No. 707, quieting of title and damages.

In opposition, the petitioners averred the following special and affirmative defenses: (1) the respondents cause of action had long prescribed and that she is guilty of laches hence, now
estopped from bringing the suit; (2) TCT No. 42244 in the name of Felipa and Hilaria have already attained indefeasibility and conclusiveness as to the true owners of Lot No. 707; and

(3) an action for partition is no longer tenable because Felipa and Hilaria have already acquired rights adverse to that claimed by respondent Emilia and the same amount to a
repudiation of the alleged co-ownership.16

During pre-trial conference, the issues were simplified into: (1) whether or not Lot Nos. 2299 and 705 are the exclusive properties of Leandro; and (2) whether or not respondent Emilia
is the owner of the eastern half of Lot No. 707.17

On the basis of the evidence adduced by the parties, the RTC rendered its Decision dated June 26, 1997 disposing as follows:

WHEREFORE, premises considered, the complaint for partition, reconveyance, quieting of title and damages is hereby ordered dismissed whereas the affidavit of self-adjudication[,]
deed of sale and the transfer certificate of title involving Lot 707 are hereby declared null and void.

No costs.

SO ORDERED.18

The RTC ruled that a partition of Lot Nos. 2299 and 705 will be premature since their ownership is yet to be transmitted from Leandro to his heirs whose respective shares thereto must
still be determined in estate settlement proceedings. Anent Lot No. 707, the RTC held that petitioner Carolina transferred only her one-half () share to Felipa and Hilaria and any
conveyance of the other half pertaining to Agripina was void. While the RTC nullified theAffidavit of Self-Adjudication, Deed of Absolute Sale and TCT No. 42244, it refused to adjudicate
the ownership of the lots eastern half portion in favor of respondent Emilia since a settlement of the estate of Eulalio is yet to be undertaken.19

Respondent Emilia appealed to the CA, which, in its Decision dated December 11, 2001, ruled that the RTC erred in refusing to partition Lot No. 707. The CA explained that there is no
necessity for placing Lot No. 707 under judicial administration since Carolina had long sold her pro indiviso share to Felipa and Hilaria. Thus, when Carolina sold the entire Lot No.
707 on December 11, 1962 as her own, the sale affected only her share and not that belonging to her co-owner, Agripina. The proper action in such case is not the nullification of the
sale, or for the recovery of possession of the property owned in common from the third person, but for a division or partition of the entire lot. Such partition should result in segregating
the portion belonging to the seller and its delivery to the buyer.

The CA, however, agreed with the RTC that a partition of Lot Nos. 2299 and 705 is indeed premature considering that there is a pending legal controversy with respect to Lot No. 705
and the accounting of the income from Lot No. 2299 and of the expenses for the last illness and burial of Leandro and Carolina, for which the lots appear to have been intended.

Accordingly, the decretal portion of the CA decision reads:

WHEREFORE, premises considered, the present appeal is hereby GRANTED and the decision appealed from in Civil Case No. U-5826 is hereby VACATED and SET ASIDE. A new
judgment is hereby rendered declaring Lot No. 707 covered by TCT No. 42244 to be owned by appellant Emilia Figuracion-Gerilla [herein respondent], pro indiviso share, appellee
Felipa Figuracion [herein petitioner], pro indiviso share, and appellee Hilaria Figuracion [herein petitioner], pro indiviso share, who are hereby directed to partition the same and if
they could not agree on a partition, they may petition the trial court for the appointment of a commissioner to prepare a project of partition, in accordance with the procedure as provided
in Rule 69 of the 1997 Rules of Civil Procedure, as amended.

No pronouncement as to costs.

SO ORDERED.20

Respondent Emilia appealed the CAs decision to the Court, docketed as G.R. No. 154322. In a Decision promulgated on August 22, 2006, the Court denied the appeal, concurring with
the CAs ruling that a partition of Lot Nos. 2299 and 705 would be inappropriate considering that: (1) the ownership of Lot No. 705 is still in dispute; and (2) there are still unresolved
issues as to the expenses chargeable to the estate of Leandro.

The present petition involves the appeal of the petitioners who attribute this sole error committed by the CA:

THE DECISION RENDERED BY THE HONORABLE COURT OF APPEALS IS CONTRARY TO LAW AND EXISTING JURISPRUDENTIAL DICTA LAID DOWN BY THE HONORABLE
SUPREME COURT.21

In view of the Courts ruling in G.R. No. 154322, the ensuing discussion shall concern only Lot No. 707.

The Arguments of the Parties

The petitioners argue that respondent Emilia has no valid basis for her claim of ownership because the Deed of Quitclaim executed in her favor by Agripina was in fact a deed of
donation that contained no acceptance and thus, void. The petitioners attached a copy of the Deed of Quitclaim and stressed on the following portions, viz:

I, AGRIPINA ESTIOKO ADVIENTO, of le[ga]l age, Filipino citizen, single and a resident [of] San Vicenter (sic), Urdaneta City, Pangasinan, for and in consideration of the sum of ONE
PESO ([P]1.00), Philippine Currency and the services rendered by my niece EMILIA FIGURACION, 20 years old, single, Filipino citizen and a resident of San Vicente, Urdaneta City,
Pangasinan, do hereby by these presentsw (sic) RENOUNCE, RELEASE and forever QUITCLAIM in favor of EMILIA FIGURACION, her heirs, and assigns the ONE[-]HALF (1/2)
eastern portion of the following parcel of land more particularly described and bounded as follows to wit[.]22

They further aver that the Deed of Quitclaim is riddled with defects that evoke questions of law, because: (a) it has not been registered with the Register of Deeds, albeit, allegedly
executed as early as 1961; (b) a certification dated June 3, 2003 issued by the Office of the Clerk of Court (OCC) of the RTC of Urdaneta, Pangasinan, shows that it does not have a
copy of the Deed of Quitclaim; (c) the Office of the National Archives which is the depository of old and new notarized documents has no record of the Deed of Quitclaim as evidenced
by a certification dated May 19, 2003;23 and (d) Atty. Felipe V. Abenojar, who supposedly notarized the Deed of Quitclaim was not commissioned to notarize in 1961 per the
certification dated June 9, 2003 from the OCC of the RTC of Urdaneta, Pangasinan.24

Respondent Emilia, on the other hand, contends that the Deed of Quitclaim should be considered an onerous donation that requires no acceptance as it is governed by the rules on
contracts and not by the formalities for a simple donation.25

The Courts Ruling

Issues not raised before the courts a quo cannot be raised for the first time in a petition filed under Rule 45

Records show that there is a palpable shift in the defense raised by the petitioners before the RTC and the CA.

In the Pre-Trial Order26 of the RTC dated April 4, 1995, the parties agreed to limit the issue with regard to Lot No. 707 as follows: whether or not respondent Emilia is the owner of the
eastern half portion of Lot No. 707. The petitioners supporting theory for this issue was that "the Deed of Quitclaim dated November 28, 1961 was rendered ineffective by the issuance
of [TCT No. 42244] in the name of Felipa and Hilaria."27 On appeal to the CA, however, the petitioners raised a new theory by questioning the execution and enforceability of the Deed
of Quitclaim. They claimed that it is actually a donation that was not accepted in the manner required by law.28

The inconsistent postures taken by the petitioners breach the basic procedural tenet that a party cannot change his theory on appeal as expressly adopted in Rule 44, Section 15 of the
Rules of Court, which reads:

Sec. 15. Questions that may be raised on appeal. Whether or not the appellant has filed a motion for new trial in the court below, he may include in his assignment of errors any
question of law or fact that has been raised in the court below and which is within the issues framed by the parties.

Fortifying the rule, the Court had repeatedly emphasized that defenses not pleaded in the answer may not be raised for the first time on appeal. When a party deliberately adopts a
certain theory and the case is decided upon that theory in the court below, he will not be permitted to change the same on appeal, because to permit him to do so would be unfair to the
adverse party.29 The Court had likewise, in numerous times, affirmed that points of law, theories, issues and arguments not brought to the attention of the lower court need not be, and
ordinarily will not be, considered by a reviewing court, as these cannot be raised for the first time at such late stage. Basic considerations of due process underlie this rule. It would be
unfair to the adverse party who would have no opportunity to present further evidence material to the new theory, which it could have done had it been aware of it at the time of the
hearing before the trial court.30

While a party may change his theory on appeal when the factual bases thereof would not require presentation of any further evidence by the adverse party in order to enable it to
properly meet the issue raised in the new theory,31this exception does not, however, obtain in the case at hand.

Contrary to the petitioners assertion, the Court finds that the issues on the supposed defects and actual nature of the Deed of Quitclaim are questions of fact that require not only a
review or re-evaluation of the evidence already adduced by the parties but also the reception of new evidence as the petitioners themselves have acknowledged when they attached in
the petition several certifications32 in support of their new argument. It is settled that questions of fact are beyond the province of a Rule 45 petition since the Court is not a trier of
facts.33

Accordingly, the Court will not give due course to the new issues raised by the petitioners involving the nature and execution of the Deed of Quitclaim. For their failure to advance these
questions during trial, the petitioners are now barred by estoppel34 from imploring an examination of the same.

The respondent can compel the

partition of Lot No. 707

The first stage in an action for partition is the settlement of the issue of ownership. Such an action will not lie if the claimant has no rightful interest in the subject property. In fact, the
parties filing the action are required by the Rules of Court to set forth in their complaint the nature and the extent of their title to the property. It would be premature to effect a partition
until and unless the question of ownership is first definitely resolved.35

Here, the respondent traces her ownership over the eastern half of Lot No. 707 from the Deed of Quitclaim executed by Agripina, who in turn, was the co-owner thereof being one of the
legitimate heirs of Eulalio. It is well to recall that the petitioners failed to categorically dispute the existence of the Deed of Quitclaim. Instead, they averred that it has been rendered
ineffective by TCT No. 42244 in the name of Felipa and Hilariathis contention is, of course, flawed.

Mere issuance of a certificate of title in the name of any person does not foreclose the possibility that the real property may be under coownership with persons not named in the
certificate, or that the registrant may only be a trustee, or that other parties may have acquired interest over the property subsequent to the issuance of the certificate of title.36 Stated
differently, placing a parcel of land under the mantle of the Torrens system does not mean that ownership thereof can no longer be disputed. The certificate cannot always be
considered as conclusive evidence of ownership.37 In this case, co-ownership of Lot No. 707 was precisely what respondent Emilia was able to successfully establish, as
correctly found by the RTC and affirmed by the CA.

The status of Agripina and Carolina as the legitimate heirs of Eulalio is an undisputed fact. As such heirs, they became co-owners of Lot No. 707 upon the death of Eulalio on July 20,
1930. Since Faustina was predeceased by Eulalio, she likewise became a co-owner of the lot upon Eulalios death. Faustinas share, however, passed on to her daughter Carolina
when the former died on October 18, 1949. The Affidavit of Self-Adjudication executed by Carolina did not prejudice the share of Agripina because it is not legally possible for one to
adjudicate unto himself an entire property he was not the sole owner of. A co-owner cannot alienate the shares of her other co-owners nemo dat qui non habet.38

Hence, Lot No. 707 was a co-owned property of Agripina and Carolina. As co-owners, each of them had full ownership of her part and of the fruits and benefits pertaining thereto. Each
of them also had the right to alienate the lot but only in so far as the extent of her portion was affected.39

Thus, when Carolina sold the entire Lot No. 707 on December 11, 1962 to Hilaria and Felipa without the consent of her co-owner Agripina, the disposition affected only Carolinas pro
indiviso share, and the vendees, Hilaria and Felipa, acquired only what corresponds to Carolinas share. A co-owner is entitled to sell his undivided share; hence, a sale of the entire
property by one co-owner without the consent of the other co-owners is not null and void and only the rights of the co-owner/seller are transferred, thereby making the buyer a co-owner
of the property.40

Accordingly, the deed of sale executed by Carolina in favor of Hilaria and Felipa was a valid conveyance but only insofar as the share of Carolina in the co-ownership is concerned. As
Carolinas successors-in-interest to the property, Hilaria and Felipa could not acquire any superior right in the property than what Carolina is entitled to or could transfer or alienate after
partition.

In a contract of sale of co-owned property, what the vendee obtains by virtue of such a sale are the same rights as the vendor had as co-owner, and the vendee merely steps into the
shoes of the vendor as co-owner.41 Hilaria and Felipa did not acquire the undivided portion pertaining to Agripina, which has already been effectively bequeathed to respondent Emilia
as early as November 28, 1961 thru the Deed of Quitclaim. In turn, being the successor-in-interest of Agripinas share in Lot No. 707, respondent Emilia took the formers place in the
co-ownership and as such co-owner, has the right to compel partition at any time.42

The respondents right to demand

for partition is not barred by
acquisitive prescription or laches

The petitioners posit that the issuance of TCT No. 42244 in the name of Hilaria and Felipa over Lot No. 707 on December 11, 1962 was an express repudiation of the co-ownership with
respondent Emilia. Considering the period of time that has already lapsed since then, acquisitive prescription has already set in and the respondent is now barred by laches from
seeking a partition of the subject lot.

The contention is specious.

Co-heirs or co-owners cannot acquire by acquisitive prescription the share of the other co-heirs or co-owners absent a clear repudiation of the co ownership.43 The act of repudiation,
as a mode of terminating co-ownership, is subject to certain conditions, to wit: (1) a co-owner repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the
other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for
the period required by law.44

The petitioners failed to comply with these conditions. The act of Hilaria and Felipa in effecting the registration of the entire Lot No. 707 in their names thru TCT No. 42244 did not serve
to effectively repudiate the co-ownership. The respondent built her house on the eastern portion of the lot in 1981 without any opposition from the petitioners. Hilaria also paid realty
taxes on the lot, in behalf of the respondent, for the years 1983-1987.45 These events indubitably show that Hilaria and Felipa failed to assert exclusive title in themselves adversely to
Emilia. Their acts clearly manifest that they recognized the subsistence of their co-ownership with respondent Emilia despite the issuance of TCT No. 42244 in 1962. Their acts
constitute an implied recognition of the co-ownership which in turn negates the presence of a clear notice of repudiation to the respondent. To sustain a plea of prescription, it must
always clearly appear that one who was originally a joint owner has repudiated the claims of his co-owners, and that his co-owners were apprised or should have been apprised of his
claim of adverse and exclusive ownership before the alleged prescriptive period began to run.46

In addition, when Hilaria and Felipa registered the lot in their names to the exclusion of Emilia, an implied trust was created by force of law and the two of them were considered a
trustee of the respondents undivided share.47 As trustees, they cannot be permitted to repudiate the trust by relying on the registration. In Ringor v. Ringor,48 the Court had the
occasion to explain the reason for this rule:

A trustee who obtains a Torrens title over a property held in trust for him by another cannot repudiate the trust by relying on the registration. A Torrens Certificate of Title in
Joses name did not vest ownership of the land upon him. The Torrens system does not create or vest title. It only confirms and records title already existing and vested. It does not
protect a usurper from the true owner. The Torrens system was not intended to foment betrayal in the performance of a trust. It does not permit one to enrich himself at the expense of
another. Where one does not have a rightful claim to the property, the Torrens system of registration can confirm or record nothing. Petitioners cannot rely on the registration of the
lands in Joses name nor in the name of the Heirs of Jose M. Ringor, Inc., for the wrong result they seek. For Jose could not repudiate a trust by relying on a Torrens title he held in trust
for his co-heirs.1wphi1 The beneficiaries are entitled to enforce the trust, notwithstanding the irrevocability of the Torrens title. The intended trust must be sustained.49 (Citations
omitted and emphasis ours)

Further, records do not reflect conclusive evidence showing the manner of occupation and possession exercised by Hilaria and Felipa over the lot from the time it was registered in their
names. The only evidence of possession extant in the records dates back only to 1985 when Hilaria and Felipa declared the lot in their names for taxation purposes.50 Prescription can
only produce all its effects when acts of ownership, or in this case, possession, do not evince any doubt as to the ouster of the rights of the other co-owners. Hence, prescription among
co-owners cannot take place when acts of ownership exercised are vague or uncertain.51

Moreover, the evidence relative to the possession, as a fact upon which the alleged prescription is based, must be clear, complete and conclusive in order to establish said prescription
without any shadow of doubt; and when upon trial it is not shown that the possession of the claimant has been adverse and exclusive and opposed to the rights of the others, the case
is not one of ownership, and partition will lie.52 The petitioners failed to muster adequate evidence of possession essential for the reckoning of the 10-year period for acquisitive
prescription.

The express disavowal of the co-ownership did not happen on December 11, 1962 when TCT No. 42244 was issued but in 1994 when Hilaria attempted to demolish Emilias house
thus explicitly excluding her from the co-ownership. It was the only time that Hilaria and Felipa made known their denial of the co-ownership. On the same year, the respondent
instituted the present complaint for partition; hence, the period required by law for acquisitive period to set in was not met.

Anent laches, the Court finds it unavailing in this case in view of the proximity of the period when the co-ownership was expressly repudiated and when the herein complaint was filed.
Laches is the negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it has abandoned it or declined to assert
it.53 More so, laches is a creation of equity and its application is controlled by equitable considerations. It cannot be used to defeat justice or perpetrate fraud and injustice. Neither
should its application be used to prevent the rightful owners of a property from recovering what has been fraudulently registered in the name of another.54

Partition of Lot No. 707

Under the Old Civil Code55 which was then in force at the time of Eulalio and Marcelas marriage, Lot No. 707 was their conjugal property.56 When Marcela died, one-half of the lot was
automatically reserved to Eulalio, the surviving spouse, as his share in the conjugal partnership.57 Marcelas rights to the other half, in turn, were transmitted to her legitimate child,
Agripina and surviving spouse Eulalio.58 Under Article 834 of the Old Civil Code, Eulalio was entitled only to the usufruct of the lot while the naked ownership belonged to Agripina.
When he remarried, Eulalios one half portion of the lot representing his share in the conjugal partnership and his usufructuary right over the other half were brought into his second
marriage with Faustina.59

When Eulalio died on July 20, 1930, portion of the lot was reserved for Faustina as her share in the conjugal partnership.60 The remaining were transmitted equally to the widow
Faustina and Eulalios children, Carolina and Agripina.61 However, Faustina is only entitled to the usufruct of the third available for betterment.62

The usufructuary of Eulalio over the portion inherited by Agripina earlier was merged with her naked ownership.63Upon the death of Faustina, the shares in Lot No. 707 which
represents her share in the conjugal partnership and her inheritance from Eulalio were in turn inherited by Carolina64 including Faustinas usufructuary rights which were merged with
Carolinas naked ownership.65

Consequently, Agripina is entitled to 5/8 portion of Lot No. 707 while the remaining 3/8 pertains to Carolina. Thus, when Carolina sold Lot No. 707 to Hilaria and Felipa, the sale affected
only 3/8 portion of the subject lot. Since theDeed of Quitclaim, bequeathed only the eastern portion of Lot No. 707 in favor of Emilia instead of Agripinas entire 5/8 share thereof, the
remaining 1/8 portion shall be inherited by Agripinas nearest collateral relative,66 who, records show, is her sister Carolina.

In sum, the CA committed no reversible error in holding that the respondent is entitled to have Lot No. 707 partitioned. The CA judgment must, however, be modified to conform to the
above-discussed apportionment of the lot among Carolina, Hilaria, Felipa and Emilia.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. CV No. 58290 dated December 11, 2001, is AFFIRMED with MODIFICATIONS as follows: (1)
3/8 portion of Lot No. 707 shall pertain in equal shares to Hilaria Figuracion and Felipa Figuracion-Manuel; (2) portion of Lot. No. 707 shall pertain to Emilia Figuracion-Gerilla; and (3)
1/8 portion of Lot No. 707 shall pertain to the estate of Carolina (Carlina) Vda. De Figuracion. The case is REMANDED to the Regional Trial Court of Urdaneta, Pangasinan, Branch 49,
who is directed to conduct a PARTITION BY COMMISSIONERS and effect the actual physical partition of the subject property, as well as the improvements that lie therein, in the
foregoing manner. The trial court is DIRECTED to appoint not more than three (3) competent and disinterested persons, who should determine the technical metes and bounds of the
property and the proper share appertaining to each co-owner, including the improvements, in accordance with Rule 69 of the Rules of Court. When it is made to appear to the
commissioners that the real estate, or a portion thereof, cannot be divided without great prejudice to the interest of the parties, the court a quo may order it assigned to one of the
parties willing to take the same, provided he pays to the other parties such sum or sums of money as the commissioners deem equitable, unless one of the parties interested ask that
the property be sold instead of being so assigned, in which case the court shall order the commissioners to sell the real estate at public sale, and the commissioners shall sell the same
accordingly, and thereafter distribute the proceeds of the sale appertaining to the just share of each co-owner. No pronouncement as to costs.

SO ORDERED.

G.R. No. 172852

January 30, 2013

CITY OF CEBU, Petitioner,

vs.
APOLONIO M. DEDAMO, JR., Respondent.

RESOLUTION

REYES, J.:

This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court seeking to annul and set aside the Decision1 dated November 30, 2005 of the Court of Appeals (CA)
ordering petitioner City of Cebu (petitioner) to pay twelve percent (12%) legal interest per annum on the unpaid balance of the just compensation paid to respondent Apolonio Dedamo,
Jr. (respondent). Likewise assailed is the Resolution2 dated May 9, 2006 denying reconsideration.

The ensuing facts are not disputed.3

The present controversy is an off-shoot of Civil Case No. CEB-14632 for eminent domain over two (2) parcels of land owned by spouses Apolonio and Blasa Dedamo (Spouses
Dedamo), filed by the petitioner before the Regional Trial Court (RTC) of Cebu City, Branch 13, on September 17, 1993. The petitioner immediately took possession of the lots after
depositing P51,156.00 with the Philippine National Bank pursuant to Section 19 of Republic Act No. 7160.4

During the pendency of the case, or on December 14, 1994, the petitioner and Spouses Dedamo entered into a Compromise Agreement whereby the latter agreed to part with the
ownership of the parcels of land in favor of the former in consideration of ONE MILLION SEVEN HUNDRED EIGHTY-SIX THOUSAND FOUR HUNDRED PESOS (P1,786,400.00) as
provisional payment and just compensation in an amount to be determined by a panel of commissioners.

Forthwith, the panel was constituted and a report was submitted to the RTC recommending the sum ofP20,826,339.50 as just compensation. The report was adopted and approved by
the RTC in its Order dated December 27, 1996.5

The RTC Order was affirmed by the CA and then by the Court, in a Decision dated May 7, 2002, when the matter was elevated for review in a petition docketed as G.R. No. 142971.

When the said decision became final and executory on September 20, 2002, the case was remanded for execution to the RTC, before which, a motion for the issuance of a writ of
execution was filed by Spouses Dedamo on April 4, 2003. On May 16, 2003, the RTC granted the motion and ordered the issuance of the writ.

In the meantime, Spouses Dedamo passed away and they were substituted in the case by herein respondent.

On December 23, 2003, the petitioner paid the respondent the sum of P19,039,939.50 which is the difference between the just compensation due and the provisional payment already
made.

On March 24, 2004, the respondent filed a Manifestation and Motion before the RTC to order the petitioner to pay interest on the just compensation computed from the time of actual
taking of the lands.

On April 30, 2004, the RTC denied the motion and ruled that it can no longer amend a final and executory judgment that did not specifically direct the payment of legal interest.
Adamant, the respondent sought recourse before the CA asserting that the petitioner is liable to pay: (a) 12% legal interest on the unpaid balance of the just compensation computed
from the time of actual taking of the property up to the date of payment of just compensation; and (b) 12% legal interest from the time the decision awarding just compensation became
final and executory on September 20, 2002 until its satisfaction on December 23, 2003.

The Ruling of the CA

In its Decision dated November 30, 2005, the CA rejected the respondents first claim since the issue was belatedly raised during the execution stage and after the judgment of just
compensation attained finality.

Nonetheless, the CA found the respondents second contention meritorious. The CA awarded legal interest accruing from the time the RTC Order dated December 27, 1996 awarding
just compensation was affirmed with finality by the Supreme Court up to the time of full payment thereof in line with the ruling in Eastern Shipping Lines, Inc. v. Court of Appeals6 that
when a court judgment awarding a sum of money becomes final and executory, it shall earn legal interest of 12% per annum reckoned from such finality until satisfaction.

Accordingly, the decretal portion of the decision reads:

WHEREFORE, in view of the foregoing, the instant petition is partially GRANTED in that the resolution dated April 30, 2004 is MODIFIED to GRANT payment of legal interest of 12%
per annum reckoned from the date of finality of the decision of the Supreme Court on May 2, 2002 up to the time full payment for the just compensation shall have been made.

No pronouncement as to cost.

SO ORDERED.7

The CA effectively reiterated the above decision when it denied8 the petitioners motion for reconsideration thereof. Both parties elevated the CA judgment to the Court. The
respondents petition was docketed as G.R. No. 172942 where he sought, in the main, that the 12% interest rate be reckoned from the date of taking of the property and not from the
date of finality of the Decision dated May 7, 2002 in G.R. No. 142971. The Court denied his petition on August 22, 2006 for failure to sufficiently show that the CA committed any
reversible error in the questioned judgment. The respondents motion for reconsideration of the said decision was denied with finality on November 27, 2006.9

At bar is the recourse interposed by the petitioner wherein he seeks the setting aside of the same CA Decision dated November 30, 2005.

On October 20, 2006, the respondent moved for the consolidation of the present petition with G.R. No. 172942.10The motion was denied in view of the prior denial of G.R. No. 172942
on August 22, 2006.11

In the case at bar, the petitioner prays for the annulment of the award of 12% legal interest made by the CA in view of the termination of the eminent domain case upon payment of the
just compensation in satisfaction of the writ of execution. The petitioner further asserts that the final judgment in Civil Case No. CEB-14632 which did not explicitly pronounce the
payment of interest can no longer be modified lest the basic principles of remedial law be defiled.12

For his part, the respondent avers13 that Section 10, Rule 67 of the Rules of Court mandating the payment of legal interest on just compensation forms part of every judgment rendered
in eminent domain cases even if the same was not directly ordered therein.

The respondent also claims that the award of just compensation must be reckoned from the date of taking of subject lots and not from the date of finality of G.R. No. 142971 because
just compensation, before it is paid, constitutes loan or forbearance of money that entails the imposition of a 12% interest per annum.

Ruling of the Court

The petition is denied on the ground of res judicata in the mode of conclusiveness of judgment.

A perusal of the allegations in the present case evidently shows that the petitioner broaches the issues similarly raised and already resolved in G.R. No. 172942.

Under the principle of conclusiveness of judgment, when a right or fact has been judicially tried and determined by a court of competent jurisdiction, or when an opportunity for such trial
has been given, the judgment of the court, as long as it remains unreversed, should be conclusive upon the parties and those in privity with them.14 Stated differently, conclusiveness of
judgment bars the re-litigation in a second case of a fact or question already settled in a previous case.151wphi1

The adjudication in G.R. No. 172942 has become binding and conclusive on the petitioner who can no longer question the respondents entitlement to the 12% legal interest awarded
by the CA. The Courts determination in G.R. No. 172942 on the reckoning point of the 12% legal interest is likewise binding on the petitioner who cannot re-litigate the said matter anew
through the present recourse.

Thus, the judgment in G.R. No. 172942 bars the present case as the relief sought in the latter is inextricably related to the ruling in the former.

WHEREFORE, premises considered, the Petition is hereby DENIED.

SO ORDERED.

25. G.R. No.171555

April 17, 2013

EVANGELINE RIVERA-CALINGASAN and E. RICAL ENTERPRISES, Petitioners,

vs.
WILFREDO RIVERA, substituted by MA. LYDIA S. RlVERA, FREIDA LEAH S. RIVERA and WILFREDO S. RIVERA, .JR., Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari,1 filed by petitioners Evangeline Rivera-Calingasan and E. Rical Enterprises,2 assailing the February 10, 2006 decision3 of the Court of
Appeals ( CA) in CA-G.R. SP No. 90717. The CA decision affirmed with modification the April 6, 2005 Decision4 and the July 8, 2005 order5 of the Regional Trial Court (RTC) of Lipa
City, Branch 85, in Civil Case No. 2003-0982.

The Factual Antecedents

During their lifetime, respondent Wilfredo Rivera and his wife, Loreto Inciong, acquired several parcels of land in Lipa City, Batangas, two of which were covered by Transfer Certificate
of Title (TCT) Nos. T-22290 and T-30557.6On July 29, 1982, Loreto died, leaving Wilfredo and their two daughters, Evangeline and Brigida Liza, as her surviving heirs.7

About eleven (11) years later, or on March 29, 1993, Loretos heirs executed an extrajudicial settlement of her one-half share of the conjugal estate, adjudicating all the properties in
favor of Evangeline and Brigida Liza; Wilfredo waived his rights to the properties, with a reservation of his usufructuary rights during his lifetime.8 On September 23, 1993, the Register
of Deeds of Lipa City, Batangas cancelled TCT Nos. T-22290 and T-30557 and issued TCT Nos. T-87494 and T-87495 in the names of Evangeline and Brigida Liza, with an annotation
of Wilfredos usufructuary rights.9

Almost a decade later, or on March 13, 2003,10 Wilfredo filed with the Municipal Trial Court in Cities (MTCC) of Lipa City a complaint for forcible entry against the petitioners and Star
Honda, Inc., docketed as Civil Case No. 0019-03.

Wilfredo claimed that he lawfully possessed and occupied the two (2) parcels of land located along C.M. Recto Avenue, Lipa City, Batangas, covered by TCT Nos. T-87494 and T87495, with a building used for his furniture business. Taking advantage of his absence due to his hospital confinement in September 2002, the petitioners and Star Honda, Inc. took
possession and caused the renovation of the building on the property. In December 2002, the petitioners and Star Honda, Inc., with the aid of armed men, barred him from entering the
property.11

Both the petitioners and Star Honda, Inc. countered that Wilfredo voluntarily renounced his usufructuary rights in a petition for cancellation of usufructuary rights dated March 4,
1996,12 and that another action between the same parties is pending with the RTC of Lipa City, Branch 13 (an action for the annulment of the petition for cancellation of usufructuary
rights filed by Wilfredo), docketed as Civil Case No. 99-0773.

The MTCC Ruling

In its December 2, 2003 decision,13 the MTCC dismissed the complaint. It found no evidence of Wilfredos prior possession and subsequent dispossession of the property. It noted that
Wilfredo admitted that both E. Rical Enterprises and Star Honda, Inc. occupied the property through lease contracts from Evangeline and her husband Ferdinand.

Wilfredo appealed to the RTC.

The RTC Ruling

In its November 30, 2004 decision,14 the RTC affirmed the MTCCs findings. It held that Wilfredo lacked a cause of action to evict the petitioners and Star Honda, Inc. since Evangeline
is the registered owner of the property and Wilfredo had voluntarily renounced his usufructuary rights.

Wilfredo sought reconsideration of the RTCs decision and, in due course, attained this objective; the RTC set aside its original decision and entered another, which ordered the eviction
of the petitioners and Star Honda, Inc.

In its April 6, 2005 decision,15 the RTC held that Wilfredos renunciation of his usufructuary rights could not be the basis of the complaints dismissal since it is the subject of litigation
pending with the RTC of Lipa City, Branch 13. The RTC found that the MTCC overlooked the evidence proving Wilfredos prior possession and subsequent dispossession of the
property, namely: (a) Evangelines judicial admission of "J. Belen Street, Rosario, Batangas" as her residence since May 2002; (b) the Lipa City Prosecutors findings, in a criminal case
for qualified trespass to dwelling, that the petitioners are not residents of the property; (c) the affidavit of Ricky Briones, Barangay Captain of Barangay 9, Lipa City where the property is
located, attesting to Wilfredos prior possession and the petitioners entry to the property during Wilfredos hospital confinement; and (d) the petitioners, with the aid of armed men,
destroyed the padlock of the building on the property. The RTC ordered the petitioners and Star Honda, Inc. to payP620,000.00 as reasonable compensation for the use and occupation
of the property, and P20,000.00 as attorneys fees.

The petitioners and Star Honda, Inc. filed separate motions for reconsideration.

In its July 8, 2005 order,16 the RTC modified its April 6, 2005 decision by absolving Star Honda, Inc. from any liability. It found no evidence that Star Honda, Inc. participated in the
dispossession.

The petitioners then filed a Rule 42 petition for review with the CA.

The CA Ruling

In its February 10, 2006 decision,17 the CA affirmed with modification the RTCs findings, noting that: (a) Evangelines admission of "J. Belen Street, Rosario, Batangas" as her
residence (a place different and distinct from the property) rendered improbable her claim of possession and occupation; and (b) Evangelines entry to the property (on the pretext of
repairing the building) during Wilfredos hospital confinement had been done without Wilfredos prior consent and was done through strategy and stealth. The CA, however, deleted the
award ofP20,000.00 as attorneys fees since the RTC decision did not contain any discussion or justification for the award.

The petitioners then filed the present petition.

Wilfredo died on December 27, 2006 and has been substituted by his second wife, Ma. Lydia S. Rivera, and their children, Freida Leah S. Rivera and Wilfredo S. Rivera, Jr.
(respondents).18

The Petition

The petitioners submit that the CA erred in equating possession with residence since possession in forcible entry cases means physical possession without qualification as to the nature
of possession, i.e., whether residing or not in a particular place. They contend that the pronouncements of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773, in the March 11,
2003 order,19 that they have been "occupying the premises since 1997"20 and Wilfredos own admission that he padlocked the doors of the building contradict Wilfredos claim of prior
possession.

The Case for the Respondents

The respondents counter that the petitioners mistakenly relied on the statements of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773 on the petitioners occupation since
1997; such statements had been rendered in an interlocutory order, and should not prevail over Evangelines admission in her answer of "Poblacion, Rosario, Batangas"21 as her
residence, compared to Wilfredos admission in his complaint of "C.M. Recto Avenue, Lipa City, Batangas" as his residence, the exact address of the disputed property.22

The Issue

The case presents to us the issue of who, between the petitioners and Wilfredo, had been in prior physical possession of the property.

Our Ruling

The petition lacks merit.

Ejectment cases involve only physical possession or possession de facto.

"Ejectment cases - forcible entry and unlawful detainer - are summary proceedings designed to provide expeditious means to protect actual possession or the right to possession of the
property involved. The only question that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the premises, that is, to the possession de facto
and not to the possession de jure. It does not even matter if a party's title to the property is questionable."23 Thus, "an ejectment case will not necessarily be decided in favor of one
who has presented proof of ownership of the subject property."24

Indeed, possession in ejectment cases "means nothing more than actual physical possession, not legal possession in the sense contemplated in civil law."25 In a forcible entry case,
"prior physical possession is the primary consideration."26 "A party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the
character of his possession, if he has in his favor prior possession in time, he has the security that entitles him to remain on the property until a person with a better right lawfully ejects
him."27 "The party in peaceable, quiet possession shall not be thrown out by a strong hand, violence, or terror."28

The respondents have proven prior physical possession of the property.

In this case, we are convinced that Wilfredo had been in prior possession of the property and that the petitioners deprived him of such possession by means of force, strategy and
stealth.

The CA did not err in equating residence with physical possession since residence is a manifestation of possession and occupation. Wilfredo had consistently alleged that he resided on
"C.M. Recto Avenue, Lipa City, Batangas," the location of the property, whereas Evangeline has always admitted that she has been a resident of "J. Belen Street, Rosario, Batangas."
The petitioners failed to prove that they have occupied the property through some other person, even if they have declared their residence in another area.

We note that in another proceeding, a criminal complaint for qualified trespass to dwelling, the Lipa City Prosecutor also observed that the petitioners did not reside on or occupy the
property on December 16, 2002,29 about three (3) months before Wilfredo filed the complaint for forcible entry on March 13, 2003. The petitioners also alleged therein that they are
residents of "J. Belen St., Rosario, Batangas" and not "No. 30 C.M. Recto Ave., Lipa City."30

Furthermore, the petitioners failed to rebut the affidavit of Barangay Captain Briones attesting to Wilfredos prior possession and the petitioners unlawful entry to the property during
Wilfredos hospital confinement.31

The petitioners claim of physical possession cannot find support in the March 11, 2003 order32 of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773 stating that the petitioners
"have been occupying the premises since 1997." We note that the order was a mere interlocutory order on Wilfredos motion for the issuance of a cease and desist order. An
interlocutory order does not end the task of the court in adjudicating the parties' contentions and determining their rights and liabilities against each other. "It is basically provisional in its
application."33 It is the nature of an interlocutory order that it is subject to modification or reversal that the result of further proceedings may warrant. Thus, the RTCs pronouncement on
the petitioners occupation "since 1997" is not res judicata on the issue of actual physical possession.

In sum, we find no reversible error in the decision appealed from and, therefore, affirm it.

Wilfredos death did not render moot the forcible entry case.

The death of Wilfredo introduces a seeming complication into the case and on the disposition we shall make. To go back to basics, the petition before us involves the recovery of
possession of real property and is a real action that is not extinguished by the death of a party. The judgment in an ejectment case is conclusive between the parties and their
successors-in-interest by title subsequent to the commencement of the action; hence, it is enforceable by or against the heirs of the deceased.1wphi1 This judgment entitles the
winning party to: (a) the restitution of the premises, (b) the sum justly due as arrears of rent or as reasonable compensation for the use and occupation of the premises, and (c)
attorneys fees and costs.

The complicating factor in the case is the nature and basis of Wilfredos possession; he was holding the property as usufructuary, although this right to de jure possession was also
disputed before his death, hand in hand with the de facto possession that is subject of the present case. Without need, however, of any further dispute or litigation, the right to the

usufruct is now rendered moot by the death of Wilfredo since death extinguishes a usufruct under Article 603(1) of the Civil Code. This development deprives the heirs of the
usufructuary the right to retain or to reacquire possession of the property even if the ejectment judgment directs its restitution.

Thus, what actually survives under the circumstances is the award of damages, by way of compensation, that the RTC originally awarded and which the CA and this Court affirmed.
This award was computed as of the time of the RTC decision (or roughly about a year before Wilfredos death) but will now have to take into account the compensation due for the
period between the RTC decision and Wilfredos death. The computation is a matter of execution that is for the RTC, as court of origin, to undertake. The heirs of Wilfredo shall succeed
to the computed total award under the rules of succession, a matter that is not within the authority of this Court to determine at this point.

WHEREFORE, we hereby DENY the appeal and accordingly AFFIRM the February 10, 2006 decision of the Court of Appeals in CA-G.R. SP No. 90717 with the MODIFICATION that,
with the termination, upon his death, of respondent Wilfredo Riveras usufructory over the disputed property, the issue of restitution of possession has been rendered moot and
academic; on the other hand, the monetary award of P620,000.00, as reasonable compensation for the use and occupation of the property up to the time of the Regional Trial Court
decision on April 6, 2005, survives and accrues to the estate of the deceased respondent Wilfredo Rivera, to be distributed to his heirs pursuant to the applicable law on succession.
Additional compensation accrues and shall be added to the compensation from the time of the Regional Trial Court decision up to respondent Wilfredo Riveras death. For purposes of
the computation of this additional amount and for the execution of the total amount due under this Decision, we hereby remand the case to the Regional Trial Court, as court of origin,
for appropriate action. Costs against petitioners Evangeline Rivera-Calingasan and E. Rical Enterprises.

SO ORDERED.

26. G.R. No. 175542

June 5, 2013

GREEN ACRES HOLDINGS, INC., Petitioner,

vs.
VICTORIA P. CABRAL, SPS. ENRIQUE T. MORAGA and VICTORIA SORIANO, FILCON READY MIXED, INC., DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD
(DARAB), and REGISTRY OF DEEDS OF BULACAN, MEYCAUA YAN BRANCH, Respondents.

x-----------------------x

G.R. No. 183205

VICTORIA P. CABRAL, Petitioner,

vs.
PROVINCIAL ADJUDICATOR, JOSEPH NOEL C. LONGBOAN I OFFICE OF THE AGRARIAN REFORM ADJUDICATOR, GREEN ACRES HOLDINGS, INC., SPOUSES ENRIQUE
T. MORAGA and VICTORIA SORIANO and FILCON READY MIXED, INC., Respondents.

DECISION

VILLARAMA, JR., J.:

Before us are two consolidated petitions for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended.

In G.R. No. 175542, petitioner Green Acres Holdings, Inc. (hereafter, Green Acres) assails the November 24, 2006 Decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 85766
dismissing its appeal from the November 3, 2004 Order2 of the Regional Trial Court (RTC) while in G.R. No. 183205, petitioner Victoria Cabral seeks to set aside the February 27, 2008
Decision3 and May 29, 2008 Resolution4 of the CA in CA-G.R. SP No. 99651.

The facts are as follows:

Victoria Cabral was the original owner of a parcel of land in Barangay Pandayan, Meycauayan, Bulacan with an area of 11,432 square meters and covered by Transfer Certificate of
Title (TCT) No. T-73737 (M). The land was placed under the coverage of Presidential Decree (P.D.) No. 27, and on March 23, 1993, three Emancipation Patents were issued to the
spouses Enrique Moraga and Victoria Soriano (Spouses Moraga) as follows: EP No. 496039 with an area of 861 square meters; EP No. 496040 with an area of 2,159 square meters;
and EP No. 496041 with an area of 8,941 square meters. The Spouses Moraga thereafter caused the cancellation of EP No. 496041 and its conversion to TCT No. 256260 (M).

On August 29, 1994, Cabral filed a complaint before the Provincial Agrarian Reform Adjudicator (PARAD) seeking the cancellation of the Emancipation Patents issued to the Spouses
Moraga on the grounds that these were obtained through fraud and that the land is not suitable for rice and corn production and has long been classified as residential, commercial,
industrial and nonagricultural land by the Zoning Administrator of the Housing and Land Use Regulatory Board. The case was docketed as Reg. Case No. 739-Bul-94.

On December 15, 1995, the PARAD rendered a decision denying the petition for cancellation of the Emancipation Patents and dismissing the complaint for lack of merit. Cabral
appealed the decision to the Department of Agrarian Reform Adjudication Board (DARAB).5

While the appeal was pending, the Spouses Moraga subdivided the lot covered by TCT No. 256260 (M) into three smaller lots, the properties subject of this case. TCT Nos. T-270125
(M) covering 3,511 square meters, T-270126 (M) covering 2,715 square meters, and T-270127 (M) covering 2,715 square meters were thereafter issued in their names on May 29,
1996. On June 19, 1996, the Spouses Moraga sold the lots to Filcon Ready Mixed Inc. (Filcon for brevity) and TCT Nos. T-274486 (M),6 T-274487 (M)7 and T-274488 (M)8 were issued
in the name of Filcon on June 24, 1996.

On April 29, 1999, Green Acres purchased9 five lots from Filcon including the three subject properties covered by TCT Nos. T-274486 (M), T-274487 (M) and T-274488 (M) in the name
of Filcon. Except for an already cancelled annotation of a real estate mortgage in favor of Philippine Commercial International Bank (PCI Bank),10 the titles were free from any
annotations, liens, notices, claims or encumbrances.

On April 30, 1999, the titles of Filcon were cancelled by the Register of Deeds of Meycauayan, Bulacan and new titles were issued in the name of Green Acres including TCT Nos. T345660 (M),11 T-345661 (M)12 and T-345662 (M)13 covering the subject properties. Green Acres then constructed a warehouse building complex on the said lots.

On January 17, 2001, the DARAB resolved Cabrals appeal and rendered judgment ordering the cancellation of the titles issued in the names of the Spouses Moraga and those of
Filcon for having been illegally acquired. The dispositive portion of the DARAB decision reads:

WHEREFORE, premises considered, the decision is hereby REVERSED and SET ASIDE and a NEW JUDGMENT is rendered disposing as follows:

1. Ordering the cancellation of TCT No. EP-051 (M) (EP No. 496039; TCT No. EP-052 (M) (EP No. 496040); TCT No. EP-052 (M) (EP No. 496041); TCT No. T-270125
(M); TCT No. T-270126 (M); and TCT No. T-270127 (M) all in the names of defendants spouses Moraga; TCT No. 274486 (M); TCT No. T-[2]74487 (M), and TCT No.
T-274488 (M) all in the name of FILCO[N] READY MIXED INC;

2. Directing the Register of Deeds of Bulacan to restore TCT No. T-73737 (M) in the name of plaintiff Victoria P. Cabral;

3. Ordering defendants Moraga and their assign, FILCON READY MIXED INC., to vacate the premises of the lands in question and turn over their possession to herein
plaintiff; and,

4. All claims and counterclaims of both parties are hereby dismissed for insufficiency of evidence.

SO ORDERED.14

When Green Acres learned about the DARAB decision, it sent a Letter15 to Filcon on March 15, 2001 advising the latter that it learned that the properties it bought from Filcon were the
subject of an adverse decision of the DARAB. Fearing that its titles and possession might be disturbed by the DARAB decision, Green Acres reminded Filcon of its warranties under the
deed of sale.

In a letter16 dated March 30, 2001, Filcon replied that it was also an innocent purchaser for value since at the time it purchased the subject property, it had no knowledge of any legal
infirmity in the title of the Spouses Moraga. In fact, it was able to secure a loan from PCI Bank in the amount of P12 million with the subject property as collateral. Filcon assured Green
Acres that it is coordinating with its predecessor, the Spouses Moraga, to make sure that Green Acres interest over the property is protected.

On April 19, 2001, Green Acres filed a Complaint17 for Quieting of Title, Damages with Application for Preliminary Injunction and Writ of Preliminary Attachment before the RTC of
Malolos, Bulacan against Cabral, the Spouses Moraga, Filcon, the DARAB and the Registry of Deeds of Meycauayan, Bulacan. The case was docketed as Civil Case No. 279-M-2001.
Green Acres sought to quiet its title and alleged that it is a purchaser in good faith and for value, claiming that it had no notice or knowledge of any adverse claim, lien, or encumbrance
on the properties. Neither was it a party to the DARAB proceedings nor did it have notice of the said proceedings where the DARAB Decision of January 17, 2001 was issued. Green
Acres claimed that the DARAB decision casts a cloud on its titles.

Cabral, in her Answer,18 denied all the material allegations in the complaint and alleged that Green Acres never acquired valid title to the subject property, much less, can it claim to be
an innocent purchaser for value. She further averred that a declaratory judgment in a petition to quiet title will effectively subject the DARAB decision to review.

After Green Acres presented its evidence, Cabral filed a Demurrer to Plaintiffs Evidence19 arguing that Green Acres failed to prove that it is a purchaser in good faith and for value.
She maintains that the complaint is not appropriate for quieting of title since it omitted to assail her titles over the subject property but instead questioned the proceedings held at the
DARAB. She likewise insisted that the trial court has no jurisdiction over the subject property since the same is still within the coverage of the Comprehensive Agrarian Reform Law and
thus under the jurisdiction of the DARAB.

In an Order20 dated November 3, 2004, the trial court granted the demurrer and ordered the case dismissed.

Green Acres motion for reconsideration having been denied, Green Acres filed with the CA an appeal which was docketed as CA-G.R. CV No. 85766.

In the meantime, the DARAB decision became final and executory on April 13, 200521 as no further recourse was sought by the Spouses Moraga from the denial of their motion for
reconsideration on February 24, 2005.22On July 8, 2005, Cabral filed with the PARAD a Motion for Issuance of Writ of Execution23 of the DARAB decision.

On January 25, 2006, the PARAD issued a Resolution denying the Motion for Issuance of Writ of Execution for lack of merit. It ruled:

Only the decision of the Board as embodied in the dispositive portion of the decision can be implemented by virtue of a writ of execution. The January 17, 2001 decision merely orders
the cancellation of the Emancipation Patent and Transfer Certificate of Titles issued by the Registry of Deeds of Bulacan in favor of Sps. MORAGA and FILCON. Hence, if ever a Writ of
Execution will be issued, it will be up to the FILCON which was included in the dispositive portion of the Decision that has become final and executory. Nothing in the body of the
decision as well as the dispositive portion thereof directs the cancellation of the title issued in favor of GREEN ACRES. If we subscribe to the prayer of the movant, we will be in effect
amending the aforementioned decision because we will be inserting something that has not been directed to be done. x x x

xxxx

Aside from amending the final and executory decision in this case, this Forum will also be violating the generally accepted principle of due process. It is already settled that even the
administrative arm of the government exercising quasi-judicial functions are not exempt from observing due process. x x x

xxxx

It is clear as the sun rises from the east that GREEN ACRES was never made a party in the case at bar. Much less was it mentioned in the decision sought to be executed itself.
GREEN ACRES can not be made to suffer the consequences of a case where it did not participate.

xxxx

Lastly, to allow movants contention will also render the pending case of quieting of title filed by GREEN ACRES against herein plaintiff movant on April 18, 2001 before the Regional
Trial Court, Third Judicial Region, Branch 84 and docketed as Civil Case 279-M-2001 which was appealed to the Court of Appeals, moot and academic.

All told, the titles of Sps. MORAGA and FILCON sought to be cancelled in the decision have already been cancelled. Therefore, there is nothing to be done anymore, as the relief
prayed for has become fait accompli.24

Cabral filed a Motion for Recusation25 and a Motion for Reconsideration.26 The PARAD, however, denied Cabrals motions on September 11, 2006.27 Thus, on November 7, 2006,
Cabral filed with the PARAD a Notice of Appeal.28

In the meantime, the CA, on November 24, 2006, rendered a decision in CA-G.R. CV No. 85766 dismissing Green Acres appeal. Citing the case of Foster-Gallego v. Spouses
Galang,29 the appellate court held that the trial court had no authority to interfere with the proceedings of a court of equal jurisdiction, much less to annul the final judgment of a coequal court. The appellate court further held that the only issue in an action to quiet title is whether there is a cloud in a title to real property because of any instrument, record, claim,
encumbrance or a proceeding that has a prima facie appearance of validity and the DARAB decision does not fall within said enumeration.

On February 27, 2007, the PARAD issued an Order30 denying due course to Cabrals Notice of Appeal and held that the resolution denying the motion for execution is an interlocutory
order against which the remedy is a petition for certiorari under Rule 65, and not an appeal to the DARAB. The PARAD further ruled that Cabrals act of impleading Green Acres as
additional defendant only in the execution stage is highly irregular and that to enforce the decision against Green Acres would violate the latters right to due process.

On June 18, 2007, Cabral filed with the CA a petition for certiorari under Rule 65 seeking to annul the January 25, 2006 and September 11, 2006 Resolutions, as well as the February
27, 2007 Order of the PARAD.

On February 27, 2008, the CA denied Cabrals petition. The appellate court ratiocinated as follows:

An execution can only be issued against a party and not against one who did not have his day in court x x x. Green Acres was never a party to the case nor it was (sic) mentioned in the
decision sought to be executed, hence, Green Acres cannot be made to suffer the consequences of a case where it did not participate. To maintain otherwise would be to ignore the
constitutional prohibition against depriving a person of his property without due process of law x x x.

Moreover, to apply the decision against Green Acres will amount to collateral attack against its titles because nowhere in the case or decision that it was considered or passed upon.
Under the Property Registration Decree, titles issued under the Torrens system can only be altered, modified or cancelled in direct proceeding in accordance with law

x x x.

Even assuming that spouses Moraga and Filcon fraudulently acquired the disputed lots, still, Green Acres has valid and legitimate titles over the same since it is a purchaser in good
faith and for value when it acquired the properties from Filcon. A buyer in good faith is one who buys the property of another without notice that some other person has a right to or
interest in such property x x x.31 (Citations omitted.)

Both Green Acres and Cabral are now before this Court seeking the reversal of the CA decisions adverse to them.

In G.R. No. 175542, Green Acres contends that the CA erred in:

x x x RULING THAT THE DARAB DECISION IS NOT A SOURCE OF A CLOUD THAT IS SUSCEPTIBLE TO AN ACTION FOR QUIETING OF TITLE.

x x x HOLDING THAT THE COURT DOES NOT HAVE AUTHORITY TO QUIET TITLES TO REAL PROPERTY AND REMOVE A CLOUD PRODUCED BY A DARAB DECISION.

x x x AFFIRMING THE ORDER OF THE REGIONAL TRIAL COURT DATED NOVEMBER 3, 2004 THEREBY IMPLIEDLY HOLDING THAT GREEN ACRES IS NOT A PURCHASER
IN GOOD FAITH FOR VALUE; THUS, ITS TITLE CAN NOT BE QUIETED.32

In G.R. No. 183205, Cabral, on the other hand, argues that the CA erred when it:

x x x FAILED TO CORRECTLY APPLY THE PERTINENT PROVISIONS OF THE DARAB 2003 RULES OF PROCEDURE, P.D. 1529 AND THE CIVIL CODE, AMONG OTHERS, AS
WELL AS THE APPLICABLE JURISPRUDENCE.

x x x DISMISSED PETITIONERS PETITION FOR CERTIORARI.

x x x FAILED TO RULE THAT THERE WAS GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF OR ABUSE OF DISCRETION ON THE PART OF PUBLIC RESPONDENT
PROVINCIAL ADJUDICATOR LONGBOAN.

x x x DECLARED THAT THE DECISION PROMULGATED ON JANUARY 17, 2001 CANNOT BE MADE TO APPLY TO RESPONDENT GREEN ACRES.

x x x DECLARED THAT (SIC) RESPONDENT GREEN ACRES TO BE AN "INNOCENT PURCHASER FOR VALUE."33

Simply put, the issues raised in the two petitions are essentially as follows: (1) Whether the January 17, 2001 DARAB decision may be enforced against Green Acres; and (2) Whether
the said DARAB decision in favor of Cabral constitutes a cloud on Green Acres title over the subject properties.

First Issue: Whether the January 17,

2001 DARAB decision may be
enforced against Green Acres.

Cabral contends that the PARAD committed grave abuse of discretion in not issuing the writ of execution to enforce the January 17, 2001 DARAB decision in her favor. She argues that
the issuance of a writ of execution is ministerial under Section 1, Rule XX of the 2003 DARAB Rules of Procedure which provides that the execution of a final order or decision shall
issue as a matter of course.

Cabral also argues that contrary to the PARADs ruling, she is not seeking the amendment of the final decision sought to be executed. She contends that the directive to the Register of
Deeds to restore TCT No. T-73737 (M) in her name means that it should be done regardless of who holds title to the property at the time of execution. In this case, it is Green Acres.
She also points out that the transfer from the Spouses Moraga to Filcon in 1996 and eventually to Green Acres in 1999 transpired after she filed a case with the DARAB in 1994.
Therefore, under Section 12.2, Rule XX of the DARAB Rules, Green Acres is considered a successor in interest by title subsequent to the commencement of the action upon whom the
final judgment or order of the DARAB is conclusive. Cabral also insists that Green Acres cannot be considered an innocent purchaser for value because the transfers were made to
defeat the DARAB ruling.

Green Acres, for its part, submits that the CA did not err in denying Cabrals petition for certiorari. Green Acres contends that Cabral, through her motion for execution, sought the
amendment of the DARAB decision and did not move merely for its execution. Green Acres points out that Cabrals motion for execution specifically sought the cancellation of Green
Acres titles even though the DARAB decision neither included Green Acres or its titles. Green Acres points out that if the issuance of a writ of execution that conforms to the decision
may be denied on the ground that it will be inequitable, moreso should it be denied in the case where the writ of execution prayed for goes beyond the decision. Hence, even if the
issuance of a writ of execution to enforce a final and executory decision is a ministerial duty, the PARAD may not issue a writ of execution against Filcon and Green Acres as prayed for
by Cabral.

Green Acres also argues that it cannot be bound by the DARAB decision since a writ of execution of a decision can only be issued against a party to the case and not against one who
did not have his day in court. Moreover, if granted, the execution sought will constitute a collateral attack against the titles of Green Acres since nowhere in the DARAB decision sought
to be executed were they mentioned. Green Acres also adds that Cabral misinterpreted Section 12.2 of the DARAB Rules to mean that a judgment issued in a case is binding upon,
and can be executed, even against those parties not impleaded in the case. Green Acres submits that Section 12 is a mere reproduction of Section 47, Rule 39 of the Rules of Court on
the principle of res judicata. Thus, the cited DARAB rule does not operate to bind Green Acres, either presently or in the future, to the DARAB decision which does not mention Green
Acres either in the body or the dispositive portion. Green Acres likewise argues that impleading it as an additional defendant in the execution stage aggravates the violation of its right to
due process.

Green Acres further contends that Cabrals argument that it is not a purchaser in good faith and for value may not be considered in the resolution of her petition before this Court as her
argument goes into the merits of the case and said matters were not raised in her motion for execution. But even if the argument could be considered, Green Acres claims that the
merits of the case show that it is a purchaser in good faith and for value. Green Acres points out that when it purchased the properties from Filcon, the properties were covered by
transfer certificates of title, not Emancipation Patents, without any indication that the titles had their origins from the application of any agrarian law. Green Acres also adds that the
occupancy or possession of the properties of both Filcon and Green Acres were not clandestine as Cabral claims. Neither can it be true, as Cabral claimed, that its acquisition of the
titles to the properties was made through "surreptitious and illegal transfers." Green Acres argues that Cabral must have known about the alleged illegal subdivision of the property and
issuance of the transfer certificates of titles or Emancipation Patents, or if she did not know, she is nonetheless deemed to have received constructive notice of the same because the
properties were registered under the Torrens System. Yet, despite said notice, Cabral, with gross negligence, failed to annotate a notice of lis pendens on said titles.

We find in favor of Green Acres.

The principle that a person cannot be prejudiced by a ruling rendered in an action or proceeding in which he was not made a party conforms to the constitutional guarantee of due
process of law.34 In Muoz v. Yabut, Jr.,35 this Court ruled:

An action for declaration of nullity of title and recovery of ownership of real property, or re-conveyance, is a real action but it is an action in personam, for it binds a particular individual
only although it concerns the right to a tangible thing. Any judgment therein is binding only upon the parties properly impleaded.

Since they were not impleaded as parties and given the opportunity to participate in Civil Case No. Q-28580, the final judgment in said case cannot bind BPI Family and the spouses
Chan. The effect of the said judgment cannot be extended to BPI Family and the spouses Chan by simply issuing an alias writ of execution against them. No man shall be affected by
any proceeding to which he is a stranger, and strangers to a case are not bound by any judgment rendered by the court. In the same manner, a writ of execution can be issued only
against a party and not against one who did not have his day in court. Only real parties in interest in an action are bound by the judgment therein and by writs of execution issued
pursuant thereto.36 (Emphasis supplied.)

It is beyond dispute that Green Acres was not made a party in the DARAB case. Consequently, the January 17, 2001 DARAB decision cannot bind Green Acres. Likewise, the binding
effect of the DARAB decision cannot be extended to Green Acres by the mere issuance of a writ of execution against it. No one shall be affected by any proceeding to which he is a
stranger, and strangers to a case are not bound by any judgment rendered by the court. In the same manner, a writ of execution can be issued only against a party and not against one
who did not have his day in court. Only real parties in interest in an action are bound by the judgment therein and by writs of execution and demolition issued pursuant thereto.37

Moreover, a Torrens title, as a general rule, is irrevocable and indefeasible, and the duty of the court is to see to it that this title is maintained and respected unless challenged in a direct
proceeding. Section 48 of P.D. No. 1529 provides:

SEC. 48. Certificate not subject to collateral attack. A certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or cancelled except in a direct proceeding
in accordance with law. (Emphasis supplied.)

In Sps. Sarmiento v. Court of Appeals,38 this Court explained when an action is a direct attack on a title and when it is collateral:

An action is deemed an attack on a title when the object of the action or proceeding is to nullify the title, and thus challenge the judgment pursuant to which the title was decreed. The
attack is direct when the object of the action is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral when, in an action to
obtain a different relief, an attack on the judgment is nevertheless made as an incident thereof.39

In the instant case, Cabral seeks the execution of a final and executory DARAB decision that directs the cancellation of the TCTs in the name of the Spouses Moraga and Filcon.
Nowhere in the said decision is Green Acres or its TCTs mentioned. Nonetheless, in her Motion for Issuance of Writ of Execution, Cabral alleged that Green Acres, like Filcon, "also
never acquired valid title to the subject land" and "hence, its present TCTs thereto should likewise be cancelled (together with the respective Emancipation Patents and TCTs of Sps.
Moraga and Filcon Ready Mixed, Inc. mentioned in the DARAB Decision) and reverted back to her TCT."40 She prayed for the issuance of a writ of execution against the Spouses
Moraga and "their subsequent assigns/successors in interest Filcon Ready Mixed, Inc. and Green Acres Holdings, Inc."41 Clearly, seeking the cancellation of the titles of Green Acres
by a mere Motion for Issuance of Writ of Execution of a decision rendered in a case where said titles were not in issue constitutes a collateral attack on them which this Court cannot
allow.

Furthermore, as correctly ruled by the PARAD and upheld by the appellate court, only the decision of the DARAB as embodied in the dispositive portion of the decision can be
implemented by a writ of execution. As held in Ingles v. Cantos:42

A writ of execution should conform to the dispositive portion of the decision to be executed, and the execution is void if it is in excess of and beyond the original judgment or award, for it
is a settled general principle that a writ of execution must conform strictly with every essential particular of the judgment promulgated. It may not vary the terms of the judgment it seeks
to enforce. Nor may it go beyond the terms of the judgment sought to be executed. Where the writ of execution is not in harmony with and exceeds the judgment which gives it life, the
writ has pro tanto no validity.43

A reading of the fallo of the DARAB decision would show that nothing in it directs the cancellation of the titles issued in favor of Green Acres. To subscribe to Cabrals prayer in her
motion is tantamount to modifying or amending a decision that has already attained finality in violation of the doctrine of immutability of judgment.

It is also worth noting that the fact that the DARAB by final judgment ordered the cancellation of the titles of the Spouses Moraga and Filcon does not automatically make the titles of
Green Acres null and void. It is settled that a void title may be the source of a valid title in the hands of an innocent purchaser for value.44 An innocent purchaser for value is one who,
relying on the certificate of title, bought the property from the registered owner, without notice that some other person has a right to, or interest in such property and pays a full and fair
price for the same at the time of such purchase or before he has notice of the claim or interest of some other person in the property.45 The rationale therefor was expressed by this
Court in the earlier case of Republic v. Court of Appeals,46 thus:

Where innocent third persons, relying on the correctness of the certificate of title thus issued, acquire rights over the property the court cannot disregard such rights and order the total
cancellation of the certificate. The effect of such an outright cancellation would be to impair public confidence in the certificate of title, for everyone dealing with property registered under
the Torrens system would have to inquire in every instance whether the title has been regularly or irregularly issued. This is contrary to the evident purpose of the law. Every person
dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go behind the certificate to determine the
condition of the property. x x x47

Green Acres is considered an innocent purchaser for value. It relied on the certificates of title of Filcon, free from any liens and encumbrances. The only annotation on them was a
cancelled real estate mortgage in favor of PCI Bank. Thus, as held by the CA, Green Acres was under no obligation to investigate beyond Filcons titles as Green Acres had all the
reason to believe that said titles were free from any lien, claim or encumbrance.

We also agree with the CA that Cabrals allegation that the Spouses Moraga, Filcon and Green Acres were parties to illegal contracts cannot be given weight as such goes into the
merits of the case and may not be considered in the execution stage.

If there is anyone to be blamed for Cabrals failure to recover the subject properties, it is Cabral herself, who, due to her own negligence, failed to annotate a notice of lis pendens on the
titles of the Spouses Moraga and Filcon and thus give notice to future transferees. She cannot claim that she was clueless that the subject properties were being transferred. As Green
Acres correctly pointed out, the transfers to Filcon and eventually to Green Acres were made through public documents and procedures. Also, considering the significant size of the
properties, occupation of the same cannot be made clandestinely. In fact, the properties were fenced by concrete walls and Filcon had constructed a batch plant while Green Acres
erected a warehouse and building on it. Had her adverse claim been annotated on said titles, said notice would have served as a warning to Green Acres or other purchasers of the
properties that any right they acquire would be subject to the outcome of the litigation before the DARAB. Having failed to make such annotation, this Court has no choice but to uphold
the titles of Green Acres, an innocent purchaser for value.

Whether the DARAB Decision in

favor of Cabral constitutes a cloud
on Green Acres title over the subject
properties

Green Acres argues that the DARAB decision is among those enumerated in Article 47648 of the Civil Code as a possible source of a cloud on title to real property. It contends that
there can hardly be any doubt that the DARAB Decision is an "instrument," or if not, a "record" and reflects a "claim" on the properties, while the proceedings before the DARAB are
"proceedings" directed at the real properties now owned by Green Acres which are "apparently valid or effective" but "unenforceable" against the titles of Green Acres. It also contends
that the appellate courts reliance on Foster-Gallego v. Spouses Galang49 is misplaced since nothing in said case supports the proposition that a decision of a coordinate court cannot
be a source of cloud under Article 476 of the Civil Code. Green Acres submits that Foster-Gallego is not applicable because the ruling there was that an action to quiet title is not the
proper remedy when to remove a cloud on a title, a final and executory decision of the court need to be reviewed or vacated. In the present case, Green Acres does not seek a review
or reversal of the DARAB decision.

Cabral, for her part, insists that the DARAB decision is not among those enumerated in Article 476 which may cast a cloud on title to real property. As to the applicability of FosterGallego, she argues that assuming that the ruling on the main issue in said case is not directly germane, the pronouncements therein on the nature, function, purpose and limitations of
a case for quieting of title and the power of the courts in such proceedings are applicable.

Green Acres arguments are meritorious.

Article 476 of the Civil Code provides:

Art. 476. Whenever there is a cloud on title to real property or any interest therein, by reason of any instrument, record, claim, encumbrance or proceeding which is apparently valid or
effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title.

An action may also be brought to prevent a cloud from being cast upon title to real property or any interest therein.

Quieting of title is a common law remedy for the removal of any cloud upon, doubt, or uncertainty affecting title to real property. Whenever there is a cloud on title to real property or any
interest in real property by reason of any instrument, record, claim, encumbrance, or proceeding that is apparently valid or effective, but is in truth and in fact, invalid, ineffective,
voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. In such action, the competent court is tasked to
determine the respective rights of the complainant and the other claimants, not only to place things in their proper places, and make the claimant, who has no rights to said immovable,
respect and not disturb the one so entitled, but also for the benefit of both, so that whoever has the right will see every cloud of doubt over the property dissipated, and he can thereafter
fearlessly introduce any desired improvements, as well as use, and even abuse the property.50

For an action to quiet title to prosper, two indispensable requisites must concur: (1) the plaintiff or complainant has a legal or equitable title or interest in the real property subject of the
action; and (2) the deed, claim, encumbrance, or proceeding claimed to be casting a cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy.51

There is no dispute as to the first requisite since Green Acres has legal title over the subject properties. The issue lies in the second requisite.

A cloud on title consists of (1) any instrument, record, claim, encumbrance or proceeding; (2) which is apparently valid or effective; (3) but is in truth and in fact invalid, ineffective,
voidable, or unenforceable; and (4) may be prejudicial to the title sought to be quieted.52

This Court holds that the DARAB decision in favor of Cabral satisfies all four elements of a cloud on title.

As Green Acres correctly points out, the DARAB decision, a final one at that, is both an "instrument" and a "record." Blacks Law Dictionary defines an instrument as a document or
writing which gives formal expression to a legal act or agreement, for the purpose of creating, securing, modifying or terminating a right.53 A record, on the other hand, is defined as a
written account of some act, court proceeding, transaction or instrument drawn up under authority of law, by a proper officer, and designed to remain as a memorial or permanent
evidence of the matters to which it relates.54 It is likewise a "claim" which is defined as a cause of action or a demand for money or property55 since Cabral is asserting her right over
the subject lots. More importantly, it is a "proceeding" which is defined as a regular and orderly progress in form of law including all possible steps in an action from its commencement
to the execution of judgment and may refer not only to a complete remedy but also to a mere procedural step that is part of a larger action or special proceeding.56

Also, the DARAB decision is apparently valid and effective.1wphi1 It is a final decision that has not been reversed, vacated or nullified. It is likewise apparently effective and may be
prejudicial to Green Acres titles since it orders the cancellation of the titles of the Spouses Moraga and Filcon all from which Green Acres derived its titles. However, as discussed
above, it is ineffective and unenforceable against Green Acres because Green Acres was not properly impleaded in the DARAB proceedings nor was there any notice of lis pendens
annotated on the title of Filcon so as to serve notice to Green Acres that the subject properties were under litigation. As such, Green Acres is an innocent purchaser for value.

Furthermore, in the case of Dare Adventure Farm Corporation v. Court of Appeals,57 this Court had the occasion to rule that one of the proper remedies of a person who was not
impleaded in the proceedings declaring null and void the title from which his title to the property had been derived, is an action for quieting title. In said case, Dare Adventure Farm
Corporation purchased property from the Goc-ongs. Dare later discovered that said property was previously mortgaged by the Goc-ongs to the Ngs. When the Goc-ongs failed to pay
their obligation, the mortgage was foreclosed and the Ngs were declared owners of the property. Dare, who was not impleaded in the foreclosure case, filed a petition for annulment of
the judgment of the trial court with the appellate court. The Court upheld the appellate courts dismissal of the petition since such remedy may be availed only when other remedies are
wanting. We further ruled that Dares resort to annulment of judgment was unnecessary since it cannot be prejudiced by the judgment as it was not impleaded. Two remedies were
suggested to Dare as proper recourse, one of which is an action for quieting of title:

We agree with the CA's suggestion that the petitioner's proper recourse was either an action for quieting of title or an action for reconveyance of the property. It is timely for the Court to
remind that the petitioner will be better off if it should go to the courts to obtain relief through the proper recourse; otherwise, it would waste its own time and effort, aside from thereby
unduly burdening the dockets of the courts.

The petitioner may vindicate its rights in the property through an action for quieting of title, a common law remedy designed for the removal of any cloud upon, or doubt, or uncertainty
affecting title to real property. The action for quieting of title may be brought whenever there is a cloud on title to real property or any interest in real property by reason of any
instrument, record, claim, encumbrance, or proceeding that is apparently valid or effective, but is, in truth and in fact, invalid, ineffective, voidable, or unenforceable, and may be
prejudicial to said title. In the action, the competent court is tasked to determine the respective rights of the plaintiff and the other claimants, not only to put things in their proper places,
and make the claimant, who has no rights to the immovable, respect and not disturb the one so entitled, but also for the benefit of both, so that whoever has the right will see every
cloud of doubt over the property dissipated, and he can thereafter fearlessly introduce any desired improvements, as well as use, and even abuse the property.58

WHEREFORE, the petition in G.R. No. 175542 is GRANTED. The Decision dated November 24, 2006 of the Court of Appeals in CA-G.R. CV No. 85766 is REVERSED and SET
ASIDE. TCT Nos. T-345660 (M), T-345661 (M) and T -345662 (M) registered in the name of Green Acres Holdings, Inc. are declared VALID and any cloud over such titles which may
have been created by the Decision dated January 17, 2001 of the Department of Agrarian Reform Adjudication Board in DARAB Case No. 5129 (Reg. Case No. 739-Bul-94) is hereby
REMOVED.

The petition in G.R. No. 183205 is DENIED for lack of merit. The Decision dated February 27, 2008 and Resolution dated May 29, 2008 of the Court of Appeals in CA-G.R. SP No.
99651 are AFFIRMED.

With costs against the petitioner in G.R. No. 183205.

SO ORDERED.

27. G.R. No. 173926

March 6, 2013

HEIRS OF LORENZO BUENSUCESO, represented by German Buensuceso, as substituted by Iluminada Buensuceso, Ryan Buensuceso and Philip Buensuceso, Petitioners,
vs.
LOVY PEREZ, substituted by Erlinda Perez-Hernandez, Teodoro G. Perez and Candida Perez-Atacador,Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 filed by the Heirs of Lorenzo Buensuceso (Lorenzo), represented by German Buensuceso (German), to nullify the decision2 dated April
27, 2006 and the resolution3 dated August 4, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 85931 insofar as it reversed the September 4, 2003 resolution4 of the Department of
Agrarian Reform Adjudication Board (DARAB) in DARAB Case No. 7178. The DARAB resolution set aside its earlier decision5 and the decision of the Provincial Agrarian Reform
Adjudication Board (PARAD)6 dismissing Germans complaint for recovery of possession7 against Lovy Perez.

The Factual Antecedents

As the CA summarized in the assailed decision, German was the son and heir of Lorenzo Buensuceso, the farmer-beneficiary of an agricultural lot, one point thirty-seven (1.37)
hectares in area, situated in Sto. Cristo, Gapan, Nueva Ecija (disputed lot). The disputed lot was awarded to

Lorenzo pursuant to Operation Land Transfer under Presidential Decree (P.D.) No. 27, and covered by Certificate of Land Transfer No. 049645 (CLT)8 issued on July 28, 1973. Upon
Lorenzos death, German allegedly immediately occupied the disputed lot and had been cultivating and residing within its premises since then. German claimed that, in 1989, Lovy
Perez forcibly entered the disputed lot, thus, compelling him to file a petition for recovery of possession with the PARAD.

In her answer with counterclaim, Lovy argued that she is the real and lawful tenant of the disputed lot as evidenced by: (1) the duly acknowledged and registered contract of leasehold
(lease contract)9 dated October 5, 1988, between her and the landowner, Joaquin Garces, which Lorenzo signed as a witness; and (2) the certifications issued by the Municipal
Agrarian Reform Officer (MARO) of the Department of Agrarian Reform (DAR),10 Gapan, Nueva Ecija, and by the Barangay Agrarian Reform Council11 stating that she is the disputed
lots registered agricultural lessee. She also claimed that she has been paying the lease rentals to Garces, as shown by receipts,12and the irrigation services13 beginning 1984 as
certified to by the National Irrigation Administration, and that she is a bona fide member of the Samahang Nayon.

On July 31, 1997, the PARAD dismissed the petition, ruling that German failed to prove that he or his father, Lorenzo, was the farm helper or the regular tenant-lessee of the disputed
lot. In contrast, Lovy successfully proved that she was the lawful tenant-lessee from all of her documentary evidence, particularly the lease contract, which established the tenancy
relation between her and Garces. German appealed the dismissal to the DARAB.

The Ruling of the DARAB

On January 16, 2001, the DARAB affirmed in toto the PARADs decision. German sought reconsideration, which he obtained in due course.

In its resolution, the DARAB set aside its earlier decision and ordered Lovy to surrender possession of the disputed lot to German. This time, the DARAB considered the CLT as clear
evidence of the Governments recognition of Lorenzo as the tenant-beneficiary of the disputed lot entitled to avail of the statutory mechanisms under P.D. No. 27 for acquiring its
ownership. It maintained the presumption of the CLTs continued validity, as the record neither showed that it was cancelled nor that grounds exist for its cancellation. Also, the DARAB
refused to recognize the personality of Garces to execute the lease contract and declared it void. It held that Lorenzo is deemed the owner of the disputed lot from the time the CLT was
issued in 1973. When the DARAB denied her motion for reconsideration, Lovy filed a petition for review14 with the CA.

While the case was pending before the CA, Lovy died and was substituted by her heirs - Erlinda Perez-Hernandez, Teodoro G. Perez and Candida Perez-Atacador (respondents).

The Ruling of the CA

The CA granted Lovys appeal and reversed the DARAB resolution. As the decisions of the PARAD and the DARAB earlier did, the CA ruled that Lorenzo had long abandoned the
disputed lot, which he confirmed when he signed as a witness to the lease contract between Garces and Lovy; that, with the execution of the lease contract, Lovy became the qualified
farmer-beneficiary, who then cultivated the disputed lot on her own account.

Additionally, the CA declared that Lorenzos CLT was not sufficient to constitute him as the owner of the disputed lot since Lorenzo failed to comply with the obligation to pay the lease
rentals that Section 26 of Republic Act (R.A.) No. 3844 requires. The CA denied Germans motion for reconsideration in its August 4, 2006 resolution,15 prompting the present
recourse.

The Petition

German faults the CA for not upholding the validity and legality of Lorenzos CLT. He argues that, as holder of the CLT, he as Lorenzos heir was entitled not only to the possession
of the disputed lot16 but also to the full benefits of a farmer-tenant under P.D. No. 27. He also argues that nothing on the records showed that the CLT had been cancelled; that Lorenzo
had failed to comply with his obligations as tenant-beneficiary; or that he or Lorenzo had abandoned the disputed lot.17

On October 16, 2006,18 during the pendency of the case before the Court, German died and was substituted by his wife, Iluminada, and his sons, Ryan and Philip (a minor), all
surnamed Buensuceso.19

The Case for the Respondents

In their defense, the respondents argue that: first, a petition for review under Rule 45 is restricted to questions of law. The question of who between Lorenzo and German, on the one
hand, and Lovy, on the other, actually tilled and cultivated the disputed lot is a clear question of fact that is not proper for a Rule 45 petition.20

Second, no cogent reason exists to modify or reverse the CAs decision as the duly notarized and registered lease contract, among others, indisputably shows that Lovy had been
actually cultivating the disputed lot since 1984.21

Third, the factual findings of the PARAD, the DARAB (in its earlier January 16, 2001 decision) and the CA are binding and conclusive on this Court, especially when, as in this case,
they are supported by substantial evidence.22

Lastly, on the issue of ownership, the respondents maintain that Lorenzos CLT is not sufficient to constitute him as owner of the disputed lot since he must first comply with certain
requisites and conditions before he can acquire absolute ownership over it. By abandoning the disputed lot, Lorenzo failed to comply with his obligations as a CLT holder, thus
disqualifying him from its possession.23

The Courts Ruling

We first address the procedural matters raised.

The rules invoked by the respondents are well settled: a Rule 45 petition is limited to questions of law, and the factual findings of the lower courts are, as a rule, conclusive on this
Court.24 The question of who, between German and the respondents, is entitled to the continued possession of the disputed lot involves factual issues and is not the proper subject of a
Rule 45 petition.

Despite this Rule 45 requirement, however, our pronouncements have likewise recognized exceptions, such as the situation obtaining here where the tribunals below conflict in their
factual findings.25 We note that the DARAB (in its resolution) in effect reversed its earlier decision and the PARADs ruling while the CA, in turn, set aside the DARABs September 4,
2003 resolution. In this light, we cannot support the procedural objection raised.

On the merits, German, as substituted by his heirs, asserts possession and ownership over the disputed lot, emphasizing the issuance of and the continued validity of Lorenzos CLT.
They invoke P.D. No. 27 to justify their position, arguing that as holder in due course of a CLT, Lorenzo remains a qualified beneficiary under the Act.

The respondents, on the other hand, claim entitlement to the continued possession of the disputed lot following the declarations of the PARAD, the DARAB (in its earlier decision) and
the CA that Lovy is the disputed lots lawful tenant. Also, they insist that Lorenzo or his heirs cannot be the owners of the disputed lot because Lorenzo failed to comply with his
obligations under the CLT. Neither can German possess the disputed lot because Lorenzo had long abandoned it.

On the issue of ownership of the disputed lot

We agree with the CA that the mere issuance of the CLT does not vest full ownership on the holder26 and does not automatically operate to divest the landowner of all of his rights over
the landholding. The holder must first comply with certain mandatory requirements to effect a transfer of ownership. Under R.A. No. 665727 in relation with P.D. No. 2728 and E.O. No.
228,29 the title to the landholding shall be issued to the tenant-farmer only upon the satisfaction of the following requirements: (1) payment in full of the just compensation for the
landholding, duly determined by final judgment of the proper court; (2) possession of the qualifications of a farmer-beneficiary under the law; (3) full-pledged membership of the farmerbeneficiary in a duly recognized farmers cooperative; and (4) actual cultivation of the landholding. We explained in several cases that while a tenant with a CLT is deemed the owner of
a landholding, the CLT does not vest full ownership on him.30 The tenant-holder of a CLT merely possesses an inchoate right that is subject to compliance with certain legal
preconditions for perfecting title and acquiring full ownership. For these reasons, we hold that Lorenzos right and claim to ownership over the disputed lot were, at most, inchoate.31

In the same vein, we hold that German as Lorenzos heir is not automatically rendered the owner of the disputed lot. German must also still first comply with certain procedural and
mandatory requirements in order to acquire Lorenzos rights under the CLT, including the right to acquire ownership of the disputed lot. Under Section 27 of R.A. No. 6657, lands not yet
fully paid by the beneficiary may be transferred, with prior approval of the DAR, to any heir of the beneficiary who, as a condition for such transfer, shall cultivate the land for himself.

On the validity of the lease contract between Garces and Lovy

We agree with the DARAB, in its resolution, that Garces had no authority to execute the lease contract. While Garces, as landowner, retained an interest over the disputed lot, any
perceived failure on Lorenzos part to comply with his obligations under the CLT did not cause the automatic cancellation of the CLT nor of the disputed lots reversion to Garces. "Lands
acquired under P.D. No. 27 do not revert to the landowner,"32 and this is true even if the CLT is cancelled. The land must be transferred back to the government and Garces could not,
by himself, institute Lovy as the new tenant-beneficiary.

Pursuant to R.A. No. 6657 in relation with P.D. No. 27,33 any sale or disposition of agricultural lands made after the effectivity of R.A. No. 6657 which has been found contrary to its
provisions shall be null and void. The proper procedure for the reallocation of the disputed lot must be followed to ensure that there indeed exist grounds for the cancellation of the CLT
or for forfeiture of rights under it, and that the lot is subsequently awarded to a qualified farmer-tenant pursuant to the law.34

Under Ministry Memorandum Circular No. 04-83 in relation with Ministry Memorandum Circular No. 08-80 and Ministry Memorandum Circular No. 07-79, the following procedures must
be observed for the reallocation of farmholdings covered by P.D. No. 27 by reason of abandonment or the refusal to become a beneficiary, among others:

I. Investigation Procedure

1. The conduct of verification by the concerned Agrarian Reform Team Leader (ARTL) to ascertain the reasons for the refusal. All efforts shall be exerted to convince the
tenant-farmer to become a beneficiary and to comply with his obligations as such beneficiary.

2. If the tenant-farmer still refuses, the ARTL shall determine the substitute. The ARTL shall first consider the immediate member of the tenant-farmers family who
assisted in the cultivation of the land, and who is willing to be substituted to all the rights and obligations of the tenant-farmer. In the absence or refusal of such member,
the ARTL shall choose one from a list of at least three qualified tenants recommended by the President of the Samahang Nayon or, in default, any organized farmer
association, subject to the award limits under P.D. No. 27.

3. Formal notice of the report shall be given to the concerned farmer-beneficiary together with all the pertinent documents and evidences.

4. The ARTL shall submit the records of the case with his report and recommendation to the District Officer within 5 days from the ARTLs determination of the substitute.
The District Officer shall likewise submit his report and recommendation to the Regional Director and the latter to the Bureau of Agrarian Legal Assistance, for review,
evaluation, and preparation of the final draft decision for final approval.

5. The decision shall declare the cancellation of the CLT if issued.35

In the event of the farmer-beneficiarys death, the transfer or reallocation of his landholding to his heirs shall be governed by Ministry Memorandum Circular No. 19-78.

In the present case, as Associate Justice Estela M. Perlas-Bernabe observed in her Reflections, Lorenzos CLT was not shown to have been properly cancelled in light of the failure to
observe the required procedures or processes. Thus, we declare the lease contract between Garces and Lovy as void. Consequently, we cannot recognize Lovys claim that she is the
present and actual agricultural lessee of the disputed lot.

As to whether Lorenzo abandoned the disputed lot

We find merit in the respondents argument that Lorenzo had long abandoned the disputed lot, thus, depriving him and his heirs of possession over it. Abandonment is a ground for the
termination of tenancy relations under Section 8 of R.A. No. 3844,36 and, under Section 22 of R.A. No. 6657 as well as under DAR Administrative Order No. 02-94 in relation to Section
22, R.A. 6657, disqualifies the beneficiary of lots awarded under P.D. No. 27 from its coverage. To additionally reiterate what we have discussed above, actual cultivation of the
farmholding is a mandatory condition for the transfer of rights under the CLT to qualify the transferee as a beneficiary under Section 22 of R.A. No. 6657.

For abandonment to exist, the following requisites must concur: (1) a clear intent to abandon; and (2) an external act showing such intent.37 The term is defined as the "willful failure of
the ARB, together with his farm household, to cultivate, till, or develop his land to produce any crop, or to use the land for any specific economic purpose continuously for a period of two
calendar years."38 It entails, among others, the relinquishment of possession of the lot for at least two (2) calendar years and the failure to pay the amortization for the same
period.39 "What is critical in abandonment is intent which must be shown to be deliberate and clear."40 The intent must be established by the factual failure to work on the landholding
absent any valid Reason41 as well as a clear intent, which is shown as a separate element.

In the present case, Lorenzo, in allowing and acquiescing to the execution of the lease contract through his signature, with presumed full awareness of its implications,42 effectively
surrendered his rights over the disputed lot. His signing of the lease contract constitutes the external act of abandonment. Notably, neither Lorenzo nor German impugned the existence
or the execution of the lease contract or the validity of Lorenzos signature on it during the proceedings before the PARAD and the DARAB. Additionally, German did not present any
evidence to support his position that Lovy forcibly entered the disputed property, thus depriving them of its possession and actual cultivation.1wphi1

We observe that, in contrast with the respondents unwavering position that Lovy had been in actual possession and cultivation of the disputed lot since 1988, Germans assertion of
continuous possession and cultivation is significantly weakened by the inconsistencies in his pleadings. German claimed that Lorenzo had been continuously tilling the disputed lot until
1989 when Lovy forcibly entered and took over its possession. At the same time, he maintained that he immediately took possession and actual cultivation of the disputed lot upon
Lorenzos death and had been in its possession since then. Interestingly, Lorenzo died in 1992. What is clear, however, from Germans various averments is that Lorenzo had not been
cultivating the disputed lot since 1988. Even if we were to believe Germans claim of continued possession and actual cultivation of the disputed lot even after Lovy forcibly entered in
1989, this claim only supports the finding of abandonment. Lorenzo would not have stood idly and allowed Lovy to cultivate the disputed lot if he did not have the intention to abandon
its possession in favor of the latter.

We reiterate that abandonment is a ground for the cancellation of a CLT and the forfeiture of the farmer-beneficiarys right to the landholding. Nevertheless, for a cancellation or
forfeiture to take place, the proper procedures must be observed and a final judgment rendered declaring a cancellation or forfeiture.

WHEREFORE, in view of these considerations, we hereby REMAND this case to the Department of Agrarian Reform for the conduct of investigation and of the necessary proceedings
to determine the qualified beneficiary of the disputed lot. No costs.

SO ORDERED.

28. G.R. No. 199146, March 19, 2014

HEIRS OF PACIFICO POCDO, NAMELY, RITA POCDO GASIC, GOLIC POCDO, MARCELA POCDO ALFELOR, KENNETH POCDO, NIXON CADOS, JACQUELINE CADOS LEE,
EFLYN CADOS, AND GIRLIE CADOS DAPLIN, HEREIN REPRESENTED BY THEIR ATTORNEYINFACT JOHN POCDO,Petitioners, v. ARSENIA AVILA AND EMELINDA
CHUA, Respondents.

RESOLUTION

CARPIO, J.:

The Case
This petition for review1 assails the 12 October 2011 Decision2 of the Court of Appeals in CAG.R. CV No. 91039. The Court of Appeals affirmed the 14 January 2008 Resolution of the
Regional Trial Court of Baguio City, Branch 61, in Civil Case No. 4710R, dismissing the complaint for lack of jurisdiction.
The Facts
In June 2000, Pacifico Pocdo, who was later substituted by his heirs upon his death, filed a complaint to quiet title over a 1,728square meter property (disputed property) located in
Camp 7, Baguio City, and covered by Tax Declaration 9606008106641. Pacifico claimed that the disputed property is part of Lot 43, TS39, which originally belonged to Pacificos
father, Pocdo Pool. The disputed property is allegedly different from the onehectare portion alloted to Polon Pocdo, the predecessorininterest of the defendants Arsenia Avila and
Emelinda Chua, in a partition made by the heirs of Pocdo Pool. Pacifico alleged that the defendants unlawfully claimed the disputed property, which belonged to Pacifico.
The facts of the case were summarized by the Court of Appeals as follows:chanRoblesvirtualLawlibrary
As it appears, in 1894, Pocdo Pool, who died in 1942, began his occupation and claim on three lots that were eventually surveyed in his name as Lot 43, TS 39SWO36431, Lot 44,
TS 39SWO36420 and Lot 45 TS 39SWO36429 with an area of 144,623 [sq.m.], 64,112 [sq.m.], and 9,427 square meters, respectively, and situated at Residence Section 4,
Baguio City. These lots were the subject of a petition to reopen judicial proceedings filed by the Heirs of Pocdo Pool with the CFI of Baguio City in Civil Reservation Case No. 1, LRC
Case 211. The registration of the lots in the names of the petitioners were [sic] granted in October 1964, but since the decision was not implemented within the 10 years [sic] prescribed
period, the Heirs filed their ancestral land claims with the DENR. In August 1991, Certificates of Ancestral Lands Claims (CALS) were issued by the DENR for Lots 44 and 45, but Lot 43
was not approved due to Memorandum Order 9815 issued by the DENR Secretary in September 1998.
In the meantime, on September 14, 1960, Polon Pocdo, an heir of Pocdo Pool, ceded his rights over the three lots to Pacifico Pocdo in exchange for a one hectare lot to be taken from
Lot 43. However, Pacifico entered into a contract with Florencio Pax and Braulio Yaranon on November 21, 1968 revoking the agreement with Polon. In the contract, the 4,875 square
meters where Polons house was located became part of the 1hectare given to Pax and Yaranon in exchange for their services in the titling of Pacificos lands.
Polon filed a complaint in August 1980 [with] the Office of the Barangay Captain at Camp 7, Baguio City, which was settled by an amicable settlement dated September 3, 1980
between Pacifico and Polon. They agreed that Polon would again retain the 4,875 square meters and Pacifico would give the 5,125 square meter area, the remaining portion of the 1
hectare share of Polon, to be taken from Lot 43 after a segregation.
On April 18, 1981, Polon entered into a Catulagan with Arsenia Avila authorizing the latter to undertake the segregation of his onehectare land from Lot 43 in accord with the amicable
settlement of September 3, 1980. In exchange, Polon would award to her 2,000 square meters from the 1hectare lot. After spending time, money and effort in the execution of the
survey, Avila gave the survey results to Polon prompting Polon to execute a Waiver of Rights dated January 21, 1987. Accordingly, the subdivided lots were declared for tax purposes
and the corresponding tax declaration issued to Polon and Arsenia, with 8,010 square meters going to Polon and 1,993 square meters to Avila.
On March 10, 2000, finding the amicable settlement, the Catulagan and Waiver of Rights in order, the CENRO of Baguio City issued in favor of Avila a Certificate of Exclusion of 993
square meters from the Ancestral Land Claim of the Heirs of Pocdo Pool over Lot 43.
On April 27, 2000, however, the Heirs of Polon Pocdo and his wife Konon filed an affidavit of cancellation with OICCENRO Teodoro Suaking and on that basis, Suaking cancelled the
Certificate of Exclusion. On May 8, 2000, Avila complained to the Regional Executive Director or RED the unlawful cancellation of her Certificate of Exclusion, and on June 1, 2000, the
RED issued a memorandum setting aside the revocation and restoring the Certificate of Exclusion. On August 13, 2001, Avila filed an administrative complaint against Suaking, and on

July 16, 2002, the RED dismissed the lettercomplaint of Avila and referred the administrative complaint to the DENR Central Office.
Acting on the motion for reconsideration by Avila [against oppositors Pacifico Pocdo, et al.], the RED in an Order on October 28, 2002 set aside the July 16, 2002 order. The Affidavit of
Cancellation dated April 27, 2002 filed by the heirs of Polon Pocdo was dismissed for lack of jurisdiction and the validity of the Amicable Settlement, Catulagan and Deed of Waiver of
Rights were recognized. The letter dated April 28, 2000 and certification issued on May 31, 2000 by Suaking were ordered cancelled. Accordingly, the RED held that the TSA
applications of Arsenia Avila and others under TSA Application 15313, 15314, 15409 and 15410 should be given due course subject to compliance with existing laws and regulations.
The DENR Secretary affirmed his Order in [his] Decision of May 14, 2004 in DENR Case 5599, with the modification that the TSAs fo[r] the appellee Avila could now be made the basis
of disposition through public bidding and the appellant may participate in the bidding if qualified.
Pacifico Pocdo, as the appellant, went on appeal to the Office of the President which resulted in an affirmance of DENR Secretarys decision on April 19, 2005 in OP Case 04H360.
As mentioned, having exhausted administrative remedies, the Heirs of Pacifico Pocdo challenged the OP resolution before the Court of Appeals, but this petition was dismissed for
having been filed late. The Supreme Court dismissed the Heirs appeal from this decision.
The instant case, Civil Case 4710R, before the Regional Trial Court of Baguio City, Branch 61 was filed by Pacifico Pocdo against Arsenia Avila and Emelinda Chua in June 2000, just
after the RED set aside Suakings revocation on April 28, 2000 and ordered the restoration of Avilas Certificate of Exclusion. Since then, the judicial proceedings have run parallel to the
administrative case.3
In a Resolution4 dated 14 January 2008, the Regional Trial Court dismissed the case for lack of jurisdiction. The trial court held that the DENR had already declared the disputed
property as public land, which the State, through the DENR, has the sole power to dispose. Thus, the claim of petitioners to quiet title is not proper since they do not have title over the
disputed property. The trial court agreed with the DENR Secretarys ruling that petitioner may participate in the public bidding of the disputed property if qualified under applicable rules.
Petitioners appealed to the Court of Appeals, asserting that the case is not limited to quieting of title since there are other issues not affected by the DENR ruling, particularly the validity
of the Waiver of Rights and the Catulagan. Petitioners maintained that the DENRs ruling that the disputed property is public land did not preclude the court from taking cognizance of
the issues on who is entitled possession to the disputed property and whether the questioned documents are valid and enforceable against Pacifico and his heirs.
The Ruling of the Court of Appeals
The Court of Appeals ruled that petitioners, in raising the issue of quieting of title, failed to allege any legal or equitable title to quiet. Under Article 477 of the Civil Code, in an action to
quiet title, the plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the action. Instead of an action to quiet title or accion
reivindicatoria, the Court of Appeals stated that petitioners should have filed an accion publiciana based merely on the recovery of possession de jure.
On the validity of the Catulagan and the Waiver of Rights, the Court of Appeals held that petitioners have no right to question these since they were not parties to said documents had
not participated in any manner in their execution. The Court of Appeals ruled that only the contracting parties are bound by the stipulations of the said documents. Those not parties to
the said documents, and for whose benefit they were not expressly made, cannot maintain an action based on the said documents.
Thus, the Court of Appeals affirmed the trial courts resolution, subject to the right of petitioners to file the appropriate action.
The Issues
Petitioners raise the following issues:chanRoblesvirtualLawlibrary
THE COURT OF APPEALS ERRED IN RULING THAT THE PETITIONERS SHOULD JUST FILE THE NECESSARY ACTION FOR RECOVERY OF POSSESSION BECAUSE SAID
COURT HAS FAILED TO TAKE INTO CONSIDERATION THAT RECOVERY OF POSSESSION IS PRECISELY ONE OF THE CAUSES OF ACTION IN THE PRESENT CASE.
THE COURT OF APPEALS ERRED IN RULING THAT THE RTC HAD NO JURISDICTION SINCE IT IS THE COURTS, NOT THE DENR, THAT HAS JURISDICTION OVER
ACTIONS INVOLVING POSSESSION OF LANDS, EVEN ASSUMING WITHOUT ADMITTING, THAT THE LAND IS A PUBLIC LAND.
THE COURT OF APPEALS ERRED IN UPHOLDING THE DISMISSAL OF THE CASE BECAUSE THERE ARE OTHER CAUSES OF ACTION OVER WHICH THE RTC HAS
JURISDICTION, i.e. RECOVERY OF POSSESSION, DECLARATION OF NULLITY OF DOCUMENTS.

THE COURT OF APPEALS ERRED IN FINDING THAT THE PETITIONERS HAVE NO TITLE TO THE PROPERTY THAT WOULD SUPPORT AN ACTION FOR QUIETING OF TITLE
WHEN TRIAL HAD NOT YET COMMENCED. NONETHELESS, THE RECORD IS REPLETE OF PROOF THAT THE PETITIONERS HAVE RIGHTS/TITLE OVER THE SUBJECT
PROPERTY.5
The Ruling of the Court
We find the petition without merit.
In the administrative case involving the disputed property, which forms part of Lot 43, the DENR ruled that Lot 43 is public land located within the Baguio Townsite Reservation. In his
Decision dated 14 May 2004 in DENR Case No. 5599, the DENR Secretary stated:chanRoblesvirtualLawlibrary
Lot 43 is public land and part of the Baguio Townsite Reservation. This has already been settled by the decision of the Court of First Instance of Benguet and Mountain Province dated
13 November 1922 in Civil Reservation Case No. 1. The fact that the heirs of Pocdo Pool were able to reopen Civil Reservation Case No. 1, LRC Case No. 211 and secure a decision
in their favor for registration of Lot 43 is of no moment. As held in Republic v. Pio R. Marcos (52 SCRA 238), the Court of First Instance of Baguio and Benguet had no jurisdiction to
order the registration of lands already declared public in Civil Reservation Case No. 1. Lot 43 being part of the Baguio Townsite Reservation, disposition thereof is under Townsite Sales
Application (TSA). Precisely on this bone [sic] that Lot 43 was not awarded a Certificate of Land Ancestral Claim [sic] under DENR Circular No. 03, series of 1990, because it is within
the Baguio Townsite Reservation.6
The DENR Decision was affirmed by the Office of the President which held that lands within the Baguio Townsite Reservation belong to the public domain and are no longer registrable
under the Land Registration Act.7 The Office of the President ordered the disposition of the disputed property in accordance with the applicable rules of procedure for the disposition of
alienable public lands within the Baguio Townsite Reservation, particularly Chapter X of Commonwealth Act No. 141 on Townsite Reservations and other applicable rules.
Having established that the disputed property is public land, the trial court was therefore correct in dismissing the complaint to quiet title for lack of jurisdiction. The trial court had no
jurisdiction to determine who among the parties have better right over the disputed property which is admittedly still part of the public domain. As held in Dajunos v. Tandayag:8
x x x The Tarucs action was for quieting of title and necessitated determination of the respective rights of the litigants, both claimants to a free patent title, over a piece of property,
admittedly public land. The law, as relied upon by jurisprudence, lodges the power of executive control, administration, disposition and alienation of public lands with the Director of
Lands subject, of course, to the control of the Secretary of Agriculture and Natural Resources.
In sum, the decision rendered in civil case 1218 on October 28, 1968 is a patent nullity. The court below did not have power to determine who (the Firmalos or the Tarucs) were entitled
to an award of free patent title over that piece of property that yet belonged to the public domain. Neither did it have power to adjudge the Tarucs as entitled to the true equitable
ownership thereof, the latters effect being the same: the exclusion of the Firmalos in favor of the Tarucs.9
In an action for quieting of title, the complainant is seeking for an adjudication that a claim of title or interest in property adverse to the claimant is invalid, to free him from the danger of
hostile claim, and to remove a cloud upon or quiet title to land where stale or unenforceable claims or demands exist.10Under Articles 47611 and 47712 of the Civil Code, the two
indispensable requisites in an action to quiet title are: (1) that the plaintiff has a legal or equitable title to or interest in the real property subject of the action; and (2) that there is a cloud
on his title by reason of any instrument, record, deed, claim, encumbrance or proceeding, which must be shown to be in fact invalid or inoperative despite its prima facie appearance of
validity.13
In this case, petitioners, claiming to be owners of the disputed property, allege that respondents are unlawfully claiming the disputed property by using void documents, namely the
Catulagan and the Deed of Waiver of Rights. However, the records reveal that petitioners do not have legal or equitable title over the disputed property, which forms part of Lot 43, a
public land within the Baguio Townsite Reservation. It is clear from the facts of the case that petitioners predecessorsininterest, the heirs of Pocdo Pool, were not even granted a
Certificate of Ancestral Land Claim over Lot 43, which remains public land. Thus, the trial court had no other recourse but to dismiss the case.
There is no more need to discuss the other issues raised since these are intrinsically linked to petitioners action to quiet title.
WHEREFORE, we DENY the petition. We AFFIRM the 12 October 2011 Decision of the Court of Appeals in CAG.R. CV No. 91039.
SO ORDERED.

29. G.R. No. 193517

January 15, 2014

THE HEIRS OF VICTORINO SARILI, NAMELY: ISABEL A. SARILI,* MELENCIA** S. MAXIMO, ALBERTO A. SARILI, IMELDA S. HIDALGO, all herein represented by CELSO A.
SARILI, Petitioners,
vs.
PEDRO F. LAGROSA, represented in this act by his Attorney-in-Fact LOURDES LABIOS MOJICA,Respondent.

DECISION

PERLAS-BERNABE, J.:

Assailed in this petition for review on Certiorari1 are the Decision2 dated May 20, 2010 and Resolution3 dated August 26, 2010 of the Court of Appeals (CA) in CA-G.R. CV No. 76258
which: (a) set aside the Decision4 dated May 27, 2002 of the Regional Trial Court of Caloocan City, Branch 131 (RTC) in Civil Case No. C-19152; (b) cancelled Transfer Certificate of
Title (TCT) No. 2622185 in the name of Victorino Sarili (Victorino) married to Isabel Amparo (Sps. Sarili); (c) reinstated TCT No. 559796 in the name of respondent Pedro F. Lagrosa
(respondent); and (d) awarded respondent moral damages, attorneys fees and litigation expenses.

The Facts

On February 17, 2000, respondent, represented by his attorney-in-fact Lourdes Labios Mojica (Lourdes) via a special power of attorney dated November 25, 19997 (November 25, 1999
SPA), filed a complaint8 against Sps. Sarili and the Register of Deeds of Caloocan City (RD) before the RTC, alleging, among others, that he is the owner of a certain parcel of land
situated in Caloocan City covered by TCT No. 55979 (subject property) and has been religiously paying the real estate taxes therefor since its acquisition on November 29, 1974.
Respondent claimed that he is a resident of California, USA, and that during his vacation in the Philippines, he discovered that a new certificate of title to the subject property was
issued by the RD in the name of Victorino married to Isabel Amparo (Isabel), i.e., TCT No. 262218, by virtue of a falsified Deed of Absolute Sale9 dated February 16, 1978 (February
16, 1978 deed of sale) purportedly executed by him and his wife, Amelia U. Lagrosa (Amelia). He averred that the falsification of the said deed of sale was a result of the fraudulent,
illegal, and malicious acts committed by Sps. Sarili and the RD in order to acquire the subject property and, as such, prayed for the annulment of TCT No. 262218, and that Sps. Sarili
deliver to him the possession of the subject property, or, in the alternative, that Sps. Sarili and the RD jointly and severally pay him the amount of P1,000,000.00, including moral
damages as well as attorneys fees.10

In their answer,11 Sps. Sarili maintained that they are innocent purchasers for value, having purchased the subject property from Ramon B. Rodriguez (Ramon), who possessed and
presented a Special Power of Attorney12 (subject SPA) to sell/dispose of the same, and, in such capacity, executed a Deed of Absolute Sale13 dated November 20, 1992 (November
20, 1992 deed of sale) conveying the said property in their favor. In this relation, they denied any participation in the preparation of the February 16, 1978 deed of sale, which may have
been merely devised by the "fixer" they hired to facilitate the issuance of the title in their names.14 Further, they interposed a counterclaim for moral and exemplary damages, as well as
attorneys fees, for the filing of the baseless suit.15

During the pendency of the proceedings, Victorino passed away16 and was substituted by his heirs, herein petitioners.17

The RTC Ruling

On May 27, 2002, the RTC rendered a Decision18 finding respondents signature on the subject SPA as "the same and exact replica"19 of his signature in the November 25, 1999 SPA
in favor of Lourdes.20 Thus, with Ramons authority having been established, it declared the November 20, 1992 deed of sale21 executed by the latter as "valid, genuine, lawful and
binding"22 and, as such, had validly conveyed the subject property in favor of Sps. Sarili. It further found that respondent "acted with evident bad faith and malice" and was, therefore,
held liable for moral and exemplary damages.23 Aggrieved, respondent appealed to the CA.

The CA Ruling

In a Decision24 dated May 20, 2010, the CA granted respondents appeal and held that the RTC erred in its ruling since the November 20, 1992 deed of sale, which the RTC found "as
valid and genuine," was not the source document for the transfer of the subject property and the issuance of TCT No. 262218 in the name of Sps. Sarili25but rather the February 16,
1978 deed of sale, the fact of which may be gleaned from the Affidavit of Late Registration26 executed by Isabel (affidavit of Isabel). Further, it found that respondent w as "not only able
to preponderate his claim over the subject property, but [has] likewise proved that his and his wifes signatures in the [February 16, 1978 deed of sale] x x x were forged."27 "[A]
comparison by the naked eye of the genuine signature of [respondent] found in his [November 25, 1999 SPA] in favor of [Lourdes], and those of his falsified signatures in [the February

16, 1978 deed of sale] and [the subject SPA] shows that they are not similar."28 It also observed that "[t]he testimony of [respondent] denying the authenticity of his purported signature
with respect to the [February 16, 1978 deed of sale] was not rebutted x x x."29 In fine, the CA declared the deeds of sale dated February 16, 1978 and November 20, 1992, as well as
the subject SPA as void, and consequently ordered the RD to cancel TCT No. 262218 in the name of Victorino married to Isabel, and consequently reinstate TCT No. 55979 in
respondents name. Respondents claims for moral damages and attorneys fees/litigation expenses were also granted by the CA.30

Dissatisfied, petitioners moved for reconsideration which was, however, denied in a Resolution31 dated August 26, 2010, hence, the instant petition.

The Issues Before the Court

The main issue in this case is whether or not there was a valid conveyance of the subject property to Sps. Sarili. The resolution of said issue would then determine, among others,
whether or not: (a) TCT No. 262218 in the name of Victorino married to Isabel should be annulled; and (b) TCT No. 55979 in respondents name should be reinstated.

The Courts Ruling

The petition lacks merit.

Petitioners essentially argue that regardless of the fictitious February 16, 1978 deed of sale, there was still a valid conveyance of the subject property to Sps. Sarili who relied on the
authority of Ramos (as per the subject SPA) to sell the same. They posit that the due execution of the subject SPA between respondent and Ramon and, subsequently, the November
20, 1992 deed of sale between Victorino and Ramon were duly established facts and that from the authenticity and genuineness of these documents, a valid conveyance of the subject
land from respondent to Victorino had leaned upon.32

The Court is not persuaded.

It is well-settled that even if the procurement of a certificate of title was tainted with fraud and misrepresentation, such defective title may be the source of a completely legal and valid
title in the hands of an innocent purchaser for value. Where innocent third persons, relying on the correctness of the certificate of title thus issued, acquire rights over the property, the
court cannot disregard such rights and order the total cancellation of the certificate. The effect of such an outright cancellation would be to impair public confidence in the certificate of
title, for everyone dealing with property registered under the Torrens system would have to inquire in every instance whether the title has been regularly or irregularly issued. This is
contrary to the evident purpose of the law.33

The general rule is that every person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go
beyond the certificate to determine the condition of the property. Where there is nothing in the certificate of title to indicate any cloud or vice in the ownership of the property, or any
encumbrance thereon, the purchaser is not required to explore further than what the Torrens Title upon its face indicates in quest for any hidden defects or inchoate right that may
subsequently defeat his right thereto.34

However, a higher degree of prudence is required from one who buys from a person who is not the registered owner, although the land object of the transaction is registered. In such a
case, the buyer is expected to examine not only the certificate of title but all factual circumstances necessary for him to determine if there are any flaws in the title of the
transferor.35 The buyer also has the duty to ascertain the identity of the person with whom he is dealing with and the latters legal authority to convey the property.36

The strength of the buyers inquiry on the sellers capacity or legal authority to sell depends on the proof of capacity of the seller. If the proof of capacity consists of a special power of
attorney duly notarized, mere inspection of the face of such public document already constitutes sufficient inquiry. If no such special power of attorney is provided or there is one but
there appears to be flaws in its notarial acknowledgment, mere inspection of the document will not do; the buyer must show that his investigation went beyond the document and into
the circumstances of its execution.37

In the present case, it is undisputed that Sps. Sarili purchased the subject property from Ramos on the strength of the latters ostensible authority to sell under the subject SPA. The
said document, however, readily indicates flaws in its notarial acknowledgment since the respondents community tax certificate (CTC) number was not indicated thereon. Under the
governing rule on notarial acknowledgments at that time,38 i.e., Section 163(a) of Republic Act No. 7160, otherwise known as the "Local Government Code of 1991," when an individual
subject to the community tax acknowledges any document before a notary public, it shall be the duty of the administering officer to require such individual to exhibit the community tax
certificate.39 Despite this irregularity, however, Sps. Sarili failed to show that they conducted an investigation beyond the subject SPA and into the circumstances of its execution as
required by prevailing jurisprudence. Hence, Sps. Sarili cannot be considered as innocent purchasers for value.

The defective notarization of the subject SPA also means that the said document should be treated as a private document and thus examined under the parameters of Section 20, Rule
132 of the Rules of Court which provides that "before any private document offered as authentic is received in evidence, its due execution and authenticity must be proved either: (a) by
anyone who saw the document executed or written; or (b) by evidence of the genuineness of the signature or handwriting of the maker x x x." Settled is the rule that a defective
notarization will strip the document of its public character and reduce it to a private instrument, and the evidentiary standard of its validity shall be based on preponderance of
evidence.40

The due execution and authenticity of the subject SPA are of great significance in determining the validity of the sale entered into by Victorino and Ramon since the latter only claims to
be the agent of the purported seller (i.e., respondent). Article 1874 of the Civil Code provides that "[w]hen a sale of a piece of land or any interest therein is through an agent, the
authority of the latter shall be in writing; otherwise, the sale shall be void." In other words, if the subject SPA was not proven to be duly executed and authentic, then it cannot be said
that the foregoing requirement had been complied with; hence, the sale would be void.

After a judicious review of the case, taking into consideration the divergent findings of the RTC and the CA on the matter,41 the Court holds that the due execution and authenticity of
the subject SPA were not sufficiently established under Section 20, Rule 132 of the Rules of Court as above-cited.

While Ramon identified the signature of respondent on the subject SPA based on his alleged familiarity with the latters signature,42 he, however, stated no basis for his identification of
the signatures of respondents wife Amelia and the witness, Evangeline F. Murral,43 and even failed to identify the other witness,44 who were also signatories to the said document. In
other words, no evidence was presented to authenticate the signatures of the other signatories of the subject SPA outside from respondent.45

Besides, as the CA correctly observed, respondents signature appearing on the subject SPA is not similar46 to his genuine signature appearing in the November 25, 1999 SPA in favor
of Lourdes,47 especially the signature appearing on the left margin of the first page.48

Unrebutted too is the testimony of respondent who, during trial, attested to the fact that he and his wife, Amelia, had immigrated to the USA since 1968 and therefore could not have
signed the subject SPA due to their absence.49

Further, records show that the notary public, Atty. Ramon S. Untalan, failed to justify why he did not require the presentation of respondents CTC or any other competent proof of the
identity of the person who appeared before him to acknowledge the subject SPA as respondents free and voluntary act and deed despite the fact that he did not personally know the
latter and that he met him for the first time during the notarization.50 He merely relied on the representations of the person before him51 and the bank officer who accompanied the
latter to his office,52 and further explained that the reason for the omission of the CTC was "because in [a] prior document, [respondent] has probably given us already his residence
certificate."53 This "prior document," was not, however, presented during the proceedings below, nor the CTC number ever identified.

Thus, in light of the totality of evidence at hand, the Court agrees with the CAs conclusion that respondent was able to preponderate his claims of forgery against the subject SPA.54 In
view of its invalidity, the November 20, 1992 sale relied on by Sps. Sarili to prove their title to the subject property is therefore void.1wphi1

At this juncture, it is well to note that it was, in fact, the February 16, 1978 deed of sale which as the CA found was actually the source of the issuance of TCT No. 262218.
Nonetheless, this document was admitted to be also a forgery.55 Since Sps. Sarilis claim over the subject property is based on forged documents, no valid title had been transferred to
them (and, in turn, to petitioners). Verily, when the instrument presented is forged, even if accompanied by the owners duplicate certificate of title, the registered owner does not
thereby lose his title, and neither does the assignee in the forged deed acquire any right or title to the property.56 Accordingly, TCT No. 262218 in the name of Victorino married to
Isabel should be annulled, while TCT No. 55979 in the name of respondent should be reinstated.

Anent the award of moral damages, suffice it to say that the dispute over the subject property had caused respondent serious anxiety, mental anguish and sleepless nights, thereby
justifying the aforesaid award.57 Likewise, since respondent was constrained to engage the services of counsel to file this suit and defend his interests, the awards of attorneys fees
and litigation expenses are also sustained.58

The Court, however, finds a need to remand the case to the court a quo in order to determine the rights and obligations of the parties with respect to the house Sps. Sarili had built59 on
the subject property in bad faith in accordance with Article 449 in relation to Articles 450, 451, 452, and the first paragraph of Article 546 of the Civil Code which respectively read as
follows:

ART. 449. He who builds, plants or sows in bad faith on the land of another, loses what is built, planted or sown without right to indemnity.

ART. 450. The owner of the land on which anything has been built, planted or sown in bad faith may demand the demolition of the work, or that the planting or sowing be removed, in
order to replace things in their former condition at the expense of the person who built, planted or sowed; or he may compel the builder or planter to pay the price of the land, and the
sower the proper rent.

ART. 451. In the cases of the two preceding articles, the landowner is entitled to damages from the builder, planter or sower.

ART. 452. The builder, planter or sower in bad faith is entitled to reimbursement for the necessary expenses of preservation of the land.

xxxx

ART. 546. Necessary expenses shall be refunded to every possessor; but only the possessor in good faith may retain the thing until he has been reimbursed therefor. (Emphases and
underscoring supplied)

xxxx

To be deemed a builder in good faith, it is essential that a person asserts title to the land on which he builds, i.e. , that he be a possessor in concept of owner, and that he be unaware
that there exists in his title or mode of acquisition any flaw which invalidates it.60 Good faith is an intangible and abstract quality with no technical meaning or statutory definition, and it
encompasses, among other things, an honest belief, the absence of malice and the absence of design to defraud or to seek an unconscionable advantage. It implies honesty of
intention, and freedom from knowledge of circumstances which ought to put the holder upon inquiry.61 As for Sps. Sarili, they knew or at the very least, should have known from the
very beginning that they were dealing with a person who possibly had no authority to sell the subject property considering the palpable irregularity in the subject SPAs acknowledgment.
Yet, relying solely on said document and without any further investigation on Ramoss capacity to sell Sps. Sarili still chose to proceed with its purchase and even built a house thereon.
Based on the foregoing it cannot be seriously doubted that Sps. Sarili were actually aware of a flaw or defect in their title or mode of acquisition and have consequently built the house
on the subject property in bad faith under legal contemplation. The case is therefore remanded to the court a quo for the proper application of the above-cited Civil Code provisions.

WHEREFORE, the petition is DENIED. The Decision dated May 20, 2010 and Resolution dated August 26, 2010 of the Court of Appeals in CA-G.R. CV No. 76258 are AFFIRMED.
However the case is REMANDED to the court a quo for the proper application of Article 449 in relation to Articles 450 451 452 and the first paragraph of Article 546 of the Civil Code
with respect to the house Spouses Victorino Sarili and Isabel Amparo had built on the subject property as herein discussed.

SO ORDERED.

30. G.R. No. 183858

April 17, 2013

HOLY TRINITY REALTY DEVELOPMENT CORPORATION, represented by JENNIFER R. MARQUEZ,Petitioner,

vs.
SPOUSES CARLOS AND ELIZABETH ABACAN, Respondents.

DECISION

SERENO, CJ.:

This is a Petition for Review under Rule 45 assailing the Decision1 and Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 97862.

The CA recalled and set aside the Order3 of the Municipal Trial Court in Cities (MTCC), Branch 2, Malo los City, and granted respondents' Motion to Quash Alias Writ of Possession
and Demolition4 in Civil Case Nos. 03-140 to 03-143.

The Facts of the case are as follows:

A parcel of land located in Sumapang, Malolos City is registered in the name of Freddie Santiago (Santiago) under Transfer Certificate of Title (TCT) No. 103697.5 On 23 August 1999,
petitioner Holy Trinity Realty Development Corporation (HTRDC) acquired the property from Santiago, but later found that the lot was already occupied by some individuals, among
them respondent-spouses Carlos and Elizabeth Abacan.6

HTRDC then filed a complaint for forcible entry against respondent-spouses and the other occupants. It withdrew the complaint, however, because it needed to verify the exact location
of the property, which the occupants claimed was covered by emancipation patents issued by the Department of Agrarian Reform Adjudication Board (DARAB).

HTRDC commenced a complaint with the DARAB for cancellation of emancipation patents against some of the occupants of the land. During the pendency of the DARAB case, the
occupants possession was tolerated.7 On 30 April 2002, the provincial adjudicator ordered the cancellation of the emancipation patents of the occupants of the land.8 The DARAB later
affirmed the decision of the provincial adjudicator.9

On 4 November 2003, HTRDC filed a complaint for unlawful detainer and damages with the MTCC of Malolos against the occupants of the subject land, again including respondent
spouses.10 Petitioner alleged that from the time it purchased the property in 1999 until the pendency of the DARAB case, it had no immediate need for the subject parcel of land. When
the need arose, it made both verbal and written demands on the occupants to vacate the property. Despite its final demand on 17 June 2003, the occupants failed to vacate the
property. Thus, HTRDC had to resort to the filing of an ejectment case against them.

Proceedings in the MTCC ensued, culminating in a Decision in favor of HTRDC. The trial court ordered the occupants to vacate the premises and to pay reasonable rent, attorneys
fees and costs of suit.11 Respondents moved to reconsider the decision, but their motion for reconsideration was denied for being a prohibited pleading in summary proceedings. The
MTCC then ordered the issuance of a writ of execution.12 Respondents appealed on 15 August 2005, but their appeal was denied due course for being filed out of time, as the period to
appeal had not been stayed by the filing of the motion for reconsideration.13 Thus, the Decision became final and executory.

Meanwhile, the provincial agrarian reform officer (PARO) filed an action for annulment of sale against HTRDC.14Respondents thereafter moved to stay execution on the ground that a
supervening event had transpired.15 The MTCC denied the motion, ruling that the mere filing of an action by the PARO did not materially change the situation of the parties, and hence,
may not be considered as a supervening event.16

In order to prevent the enforcement of the writ of execution and demolition, respondents filed several actions in the Regional Trial Court (RTC), to wit: (1) Civil Case No. 245-M-2006 for
annulment of judgment;17 (2) Special Civil Action No. 364-M-2006 for certiorari;18 and (3) Civil Case No. 59-M-2007 for quieting of title.19 Civil Case No. 245-M-2006 and Special Civil
Action No. 364-M-2006 were both dismissed by the RTC on the grounds of forum shopping and immutability of final judgment,20 while Civil Case No. 59-M-2007 was dismissed on the
ground of finality of judgment.21 Respondents did not appeal any of the adverse rulings.

The MTCC issued an Alias Writ of Execution on 25 October 2006,22 and an Alias Special Order of Demolition on 28 October 2006.23 Respondents moved to quash both writs on the
ground that Emancipation Patent Nos. 00780489 and 00780490 had been issued in their favor during the pendency of the case. As such, they argued that they had now acquired

ownership of relevant portions of the subject property.24 The MTCC denied their motion on the ground that respondents acquisition of ownership is not a supervening event that will bar
the execution of the judgment in the unlawful detainer case.25

From the Order of the MTCC denying their motion to quash, respondents filed directly with the CA a Special Civil Action for Certiorari with Prayer for a Temporary Restraining Order and
Writ of Preliminary Injunction.26

The appellate court issued a Writ of Preliminary Injunction27 and ultimately granted the petition for certiorari in a Decision dated 27 March 2008. The CA held that the MTCC had no
jurisdiction over the unlawful detainer case, and disposed of the case as follows:

IN VIEW OF ALL THE FOREGOING, the instant petition is hereby GRANTED and the Order dated January 17, 2007 of the Municipal Trial Court in Cities (MTCC), Branch 2 of Malolos
City, Bulacan, issued in Civil Case No. 03-140, is RECALLED and SET ASIDE and, in lieu thereof, the Motion to Quash Alias Writ of Possession [sic] and Demolition of the petitioners in
said case is GRANTED. The writ of preliminary injunction earlier issued is thus made permanent. No pronouncement as to costs.

SO ORDERED.28

Aggrieved by the decision of the CA, petitioner HTRDC filed the instant petition for review before this Court.

The Courts Ruling

We find merit in the instant petition.

Before proceeding to the merits of the case, we first deal with a procedural issue.

HTRDC correctly argued that respondents erred in filing the special civil action for certiorari directly with the CA instead of the RTC. In doing so, they violated the time-honored principle
of respect for the hierarchy of courts. While this Court, the CA, and the RTC have concurrent jurisdiction to issue writs of certiorari the parties to a suit are not given unbridled freedom
to choose between court forums.29 Judicial hierarchy indicates that "petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the RTC, and
those against the latter, with the CA."30 Therefore, respondents petition for certiorari was dismissible outright on procedural grounds.

Turning now to the merits of the petition, we find that the CA committed reversible error in ruling that the MTCC had no jurisdiction over the unlawful detainer case. What was before it
was a petition for certiorari against the MTCCs denial of respondents motion to quash. The petition was not directed at the MTCCs Consolidated Decision of 25 May 2005, nor could it
be, because a Rule 65 petition for certiorari must be filed not later than 60 days from notice of the judgment.31 Since respondents failed to timely appeal the Consolidated Decision, it
has long attained finality and has become immutable and unalterable pursuant to the doctrine on finality of judgment.32 Thus, as respondents sole argument in their motion to quash
was the existence of a material supervening event, and as the MTCCs denial of their motion was premised on the conclusion that their subsequent acquisition of ownership was not a
supervening event, the resolution of the present case should be limited to that issue.

Did the MTCC commit grave abuse of discretion in denying respondents motion to quash? We rule in the negative.

The term "grave abuse of discretion" has a specific meaning in jurisprudence.1wphi1 In Litton Mills v. Galleon Traders,33we explained:

An act of a court or tribunal may only be considered as committed in grave abuse of discretion when the same was performed in a capricious or whimsical exercise of judgment which is
equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform a duty enjoined by
law, or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic manner by reason of passion and personal hostility. x x x. (Citation omitted)

In this case, the motion to quash was grounded on the sole argument that the judgment should no longer be enforced because of the occurrence of a material supervening event.
Respondents alleged that before the alias writs were issued, but after the MTCC rendered judgment in the unlawful detainer case, they had acquired ownership over the subject
property as evidenced by Emancipation Patent Nos. 00780489 and 00780490.34

The MTCC correctly denied their motion, citing our ruling in Oblea v. Court of Appeals35 and Chua v. Court of Appeals36 to the effect that the subsequent acquisition of ownership is
not a supervening event that will bar the execution of the judgment in the unlawful detainer case. According to the MTCC:

This court gives due weight to the ruling of the Supreme Court in the cases of Oblea vs. Court of Appeals (244 SCRA 101) and Chua vs. Court of Appeals (271 SCRA 564), wherein it
made a categorical pronouncement that the subsequent acquisition of ownership by any person is not a supervening event that will bar the execution of the judgment in the unlawful
detainer case. True it is that the sole issue in an action for unlawful detainer x x x is physical or material possession. Such issue of physical or material possession was already passed
upon by this court during trial. As held in the case of Dizon vs. Concina (30 SCRA 897), the judgment rendered in an action for forcible entry or detainer shall be effective with respect to
the possession only and in no wise bind the title or affect the ownership of the land or building. Such judgment shall not bar an action between the parties respecting title to the land or
building. (Sec. 18, Rule 70, 1997 Rules of Civil Procedure)37

It is well-settled that the sole issue in ejectment cases is physical or material possession of the subject property, independent of any claim of ownership by the parties.38 The argument
of respondent-spouses that they subsequently acquired ownership of the subject property cannot be considered as a supervening event that will bar the execution of the questioned
judgment, as unlawful detainer does not deal with the issue of ownership.

As the case now stands, both parties are claiming ownership of the subject property: petitioner, by virtue of a Deed of Sale executed in its favor by the registered land owner; and
respondents, by subsequently issued emancipation patents in their names. This issue would more appropriately be ventilated in a full-blown proceeding, rather than in a motion to stay
the execution of the judgment rendered in the instant summary ejectment proceeding. To reiterate, the sole issue in the present case is de facto possession of the subject property, and
this was conclusively settled by the MTCC in HTRDC's favor in its final and executory Consolidated Decision of 25 May 2005. We therefore rule that the CA committed reversible error
in ruling that the MTCC committed grave abuse of discretion in denying respondents' motion to quash the alias writs of execution and demolition.

WHEREFORE, the instant Petition for Review is GRANTED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 97862 dated 27 March 2008 and 14 July
2008, respectively, are hereby SET ASIDE and REVERSED. The Order dated 17 January 2007 of the Municipal Trial Court in Cities, Branch 2, Malolos City, in Civil Case Nos. 03-140
to 03-143 is hereby REINSTATED.

SO ORDERED.

31. G.R. No. 189477

February 26, 2014

HOMEOWNERS SAVINGS AND LOAN BANK, Petitioner-Appellant,

vs.
ASUNCION P. FELONIA and LYDIA C. DE GUZMAN, represented by MARIBEL FRIAS, Respondents-Appellees.
MARIE MICHELLE P. DELGADO, REGISTER OF DEEDS OF LAS PINAS CITY and RHANDOLFO B. AMANSEC, in his capacity as Clerk of Court Ex-Officio Sheriff, Office of
the Clerk of Court, Las Pias City,Respondents-Defendants.

DECISION

PEREZ, J.:

Assailed in this Petition for Review on Certiorari is the Decision1 and Resolution2 of the Court of Appeals (CA), in CA-G.R. CV No. 87540, which affirmed with modifications, the
Decision3 of the Regional Trial Court (RTC), reinstating the title of respondents Asuncion Felonia (Felonia) and Lydia de Guzman (De Guzman) and cancelling the title of Marie Michelle
Delgado (Delgado).

The facts as culled from the records are as follows:

Felonia and De Guzman were the registered owners of a parcel of land consisting of 532 square meters with a five-bedroom house, covered by Transfer of Certificate of Title (TCT) No.
T-402 issued by the register of deeds of Las Pias City.

Sometime in June 1990, Felonia and De Guzman mortgaged the property to Delgado to secure the loan in the amount of P1,655,000.00. However, instead of a real estate mortgage,
the parties executed a Deed of Absolute Sale with an Option to Repurchase.4

On 20 December 1991, Felonia and De Guzman filed an action for Reformation of Contract (Reformation case), docketed as Civil Case No. 91-59654, before the RTC of Manila. On the
findings that it is "very apparent that the transaction had between the parties is one of a mortgage and not a deed of sale with right to repurchase,"5 the RTC, on 21 March 1995
rendered a judgment favorable to Felonia and De Guzman. Thus:

WHEREFORE, judgment is hereby rendered directing the [Felonia and De Guzman] and the [Delgado] to execute a deed of mortgage over the property in question taking into account
the payments made and the imposition of the legal interests on the principal loan.

On the other hand, the counterclaim is hereby dismissed for lack of merit.

No pronouncements as to attorneys fees and damages in both instances as the parties must bear their respective expenses incident to this suit.6

Aggrieved, Delgado elevated the case to the CA where it was docketed as CA-G.R. CV No. 49317. The CA affirmed the trial court decision. On 16 October 2000, the CA decision
became final and executory.7

Inspite of the pendency of the Reformation case in which she was the defendant, Delgado filed a "Petition for Consolidation of Ownership of Property Sold with an Option to Repurchase
and Issuance of a New Certificate of Title" (Consolidation case) in the RTC of Las Pias, on 20 June 1994.8 After an ex-parte hearing, the RTC ordered the issuance of a new title
under Delgados name, thus:

WHEREFORE, judgment is rendered-

1. Declaring [DELGADO] as absolute owner of the subject parcel of land covered by Transfer Certificate of Title No. T-402 of the Register of Deeds of Las Pias, Metro
Manila;

2. Ordering the Register of Deeds of Las Pias, Metro Manila to cancel Transfer Certificate of Title No. T-402 and issue in lieu thereof a new certificate of title and owners
duplicate copy thereof in the name of [DELGADO].9

By virtue of the RTC decision, Delgado transferred the title to her name. Hence, TCT No. T-402, registered in the names of Felonia and De Guzman, was canceled and TCT No. 44848
in the name of Delgado, was issued.

Aggrieved, Felonia and De Guzman elevated the case to the CA through a Petition for Annulment of Judgment.10

Meanwhile, on 2 June 1995, Delgado mortgaged the subject property to Homeowners Savings and Loan Bank (HSLB) using her newly registered title. Three (3) days later, or on 5 June
1995, HSLB caused the annotation of the mortgage.

On 14 September 1995, Felonia and De Guzman caused the annotation of a Notice of Lis Pendens on Delgados title, TCT No. 44848. The Notice states:

Entry No. 8219/T-44848 NOTICE OF LIS PENDENS filed by Atty. Humberto A. Jambora, Counsel for the Plaintiff, that a case been commenced in the RTC, Branch 38, Manila,
entitled ASUNCION P. FELONIA and LYDIA DE GUZMAN thru VERONICA P. BELMONTE, as Atty-in-fact (Plaintiffs) v.s. MARIE MICHELLE DELGADO defendant in Civil Case No.
91-59654 for Reformation of Instrument.

Copy on file in this Registry.

Date of Instrument Sept. 11, 1995

Date of Inscription Sept. 14, 1995 at 9:55 a.m.11

On 20 November1997, HSLB foreclosed the subject property and later consolidated ownership in its favor, causing the issuance of a new title in its name, TCT No. 64668.

On 27 October 2000, the CA annulled and set aside the decision of the RTC, Las Pias City in the Consolidation case. The decision of the CA, declaring Felonia and De Guzman as the
absolute owners of the subject property and ordering the cancellation of Delgados title, became final and executory on 1 December 2000.12 Thus:

WHEREFORE, the petition is GRANTED and the subject judgment of the court a quo is ANNULLED and SET ASIDE.13

On 29 April 2003, Felonia and De Guzman, represented by Maribel Frias (Frias), claiming to be the absolute owners of the subject property, instituted the instant complaint against
Delgado, HSLB, Register of Deeds of Las Pias City and Rhandolfo B. Amansec before the RTC of Las Pias City for Nullity of Mortgage and Foreclosure Sale, Annulment of Titles of
Delgado and HSLB, and finally, Reconveyance of Possession and Ownership of the subject property in their favor.

As defendant, HSLB asserted that Felonia and De Guzman are barred from laches as they had slept on their rights to timely annotate, by way of Notice of Lis Pendens, the pendency of
the Reformation case. HSLB also claimed that it should not be bound by the decisions of the CA in the Reformation and Consolidation cases because it was not a party therein.

Finally, HSLB asserted that it was a mortgagee in good faith because the mortgage between Delgado and HSLB was annotated on the title on 5 June 1995, whereas the Notice of Lis
Pendens was annotated only on 14 September 1995.

After trial, the RTC ruled in favor of Felonia and De Guzman as the absolute owners of the subject property. The dispositive portion of the RTC decision reads:

WHEREFORE, premises considered, the Court hereby finds for the [Felonia and De Guzman] with references to the decision of the Court of Appeals in CA-G.R. CV No. 49317 and CAG.R. SP No. 43711 as THESE TWO DECISIONS CANNOT BE IGNORED and against [Delgado] and [HSLB], Register of Deeds of Las Pias City ordering the (sic) as follows:

1. The Register of Deeds of Las Pias City to cancel Transfer Certificate of Title Nos. 44848 and T-64668 as null and void and reinstating Transfer Certificate of Title No.
T-402 which shall contain a memorandum of the fact and shall in all respect be entitled to like faith and credit as the original certificate of title and shall, thereafter be
regarded as such for all intents and purposes under the law;

2. Declaring the Mortgage Sheriffs Sale and the Certificate of Sale issued in favor of HSLB null and void, without prejudice to whatever rights the said Bank may have
against [Delgado];

3. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of PHP500,000.00 for compensatory damages;

4. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of PHP500,000.00 for exemplary damages;

5. Ordering [Delgado] to pay [Felonia and De Guzman] the amount of PHP500,000.00 for moral damages;

6. Ordering [Delgado] to pay 20% of the total obligations as and by way of attorneys fees;

7. Ordering [Delgado] to pay cost of suit.14

On appeal, the CA affirmed with modifications the trial court decision. The dispositive portion of the appealed Decision reads:

WHEREFORE, in the light of the foregoing, the decision appealed from is AFFIRMED with the MODIFICATIONS that the awards of actual damages and attorneys fees are DELETED,
moral and exemplary damages are REDUCED to P50,000.00 each, and Delgado is ordered to pay the appellees P25,000.00 as nominal damages.15

Hence, this petition.

Notably, HSLB does not question the affirmance by the CA of the trial courts ruling that TCT No. 44848, the certificate of title of its mortgagor-vendor, and TCT No. 64668, the
certificate of title that was secured by virtue of the Sheriffs sale in its favor, should be cancelled "as null and void" and that TCT No. T-402 in the name of Felonia and De Guzman
should be reinstated.

Recognizing the validity of TCT No. T-402 restored in the name of Felonia and De Guzman, petitioners pray that the decision of the CA be modified "to the effect that the mortgage lien
in favor of petitioner HSLB annotated as entry No. 4708-12 on TCT No. 44848 be [ordered] carried over on TCT No. T-402 after it is reinstated in the name of [Felonia and De
Guzman]."16

Proceeding from the ruling of the CA that it is a mortgagee in good faith, HSLB argues that a denial of its prayer would run counter to jurisprudence giving protection to a mortgagee in
good faith by reason of public policy.

We cannot grant the prayer of petitioner. The priorly registered mortgage lien of HSLB is now worthless.

Arguably, HSLB was initially a mortgagee in good faith. In Bank of Commerce v. San Pablo, Jr.,17 the doctrine of mortgagee in good faith was explained:

There is, however, a situation where, despite the fact that the mortgagor is not the owner of the mortgaged property, his title being fraudulent, the mortgage contract and any foreclosure
sale arising there from are given effect by reason of public policy. This is the doctrine of "the mortgagee in good faith" based on the rule that all persons dealing with property covered by
the Torrens Certificates of Title, as buyers or mortgagees, are not required to go beyond what appears on the face of the title. The public interest in upholding indefeasibility of a
certificate of title, as evidence of lawful ownership of the land or of any encumbrance thereon, protects a buyer or mortgagee who, in good faith, relied upon what appears on the face of
the certificate of title.

When the property was mortgaged to HSLB, the registered owner of the subject property was Delgado who had in her name TCT No. 44848. Thus, HSLB cannot be faulted in relying
on the face of Delgados title. The records indicate that Delgado was at the time of the mortgage in possession of the subject property and Delgados title did not contain any annotation
that would arouse HSLBs suspicion. HSLB, as a mortgagee, had a right to rely in good faith on Delgados title, and in the absence of any sign that might arouse suspicion, HSLB had
no obligation to undertake further investigation. As held by this Court in Cebu International Finance Corp. v.

CA:18

The prevailing jurisprudence is that a mortgagee has a right to rely in good faith on the certificate of title of the mortgagor of the property given as security and in the absence of any
sign that might arouse suspicion, has no obligation to undertake further investigation. Hence, even if the mortgagor is not the rightful owner of, or does not have a valid title to, the
mortgaged property, the mortgagee or transferee in good faith is nonetheless entitled to protection.

However, the rights of the parties to the present case are defined not by the determination of whether or not HSLB is a mortgagee in good faith, but of whether or not HSLB is a
purchaser in good faith. And, HSLB is not such a purchaser.

A purchaser in good faith is defined as one who buys a property without notice that some other person has a right to, or interest in, the property and pays full and fair price at the time of
purchase or before he has notice of the claim or interest of other persons in the property.19

When a prospective buyer is faced with facts and circumstances as to arouse his suspicion, he must take precautionary steps to qualify as a purchaser in good faith. In Spouses Mathay
v. CA,20 we determined the duty of a prospective buyer:

Although it is a recognized principle that a person dealing on a registered land need not go beyond its certificate of title, it is also a firmly settled rule that where there are circumstances
which would put a party on guard and prompt him to investigate or inspect the property being sold to him, such as the presence of occupants/tenants thereon, it is of course, expected
from the purchaser of a valued piece of land to inquire first into the status or nature of possession of the occupants, i.e., whether or not the occupants possess the land en concepto de
dueo, in the concept of the owner. As is the common practice in the real estate industry, an ocular inspection of the premises involved is a safeguard a cautious and prudent purchaser
usually takes. Should he find out that the land he intends to buy is occupied by anybody else other than the seller who, as in this case, is not in actual possession, it would then be
incumbent upon the purchaser to verify the extent of the occupants possessory rights. The failure of a prospective buyer to take such precautionary steps would mean negligence on
his part and would thereby preclude him from claiming or invoking the rights of a purchaser in good faith.

In the case at bar, HSLB utterly failed to take the necessary precautions.1wphi1 At the time the subject property was mortgaged, there was yet no annotated Notice of Lis Pendens.
However, at the time HSLB purchased the subject property, the Notice of Lis Pendens was already annotated on the title.21

Lis pendens is a Latin term which literally means, "a pending suit or a pending litigation" while a notice of lis pendens is an announcement to the whole world that a real property is in
litigation, serving as a warning that anyone who acquires an interest over the property does so at his/her own risk, or that he/she gambles on the result of the litigation over the
property.22 It is a warning to prospective buyers to take precautions and investigate the pending litigation.

The purpose of a notice of lis pendens is to protect the rights of the registrant while the case is pending resolution or decision. With the notice of lis pendens duly recorded and
remaining uncancelled, the registrant could rest secure that he/she will not lose the property or any part thereof during litigation.

The doctrine of lis pendens is founded upon reason of public policy and necessity, the purpose of which is to keep the subject matter of the litigation within the Courts jurisdiction until
the judgment or the decree have been entered; otherwise, by successive alienations pending the litigation, its judgment or decree shall be rendered abortive and impossible of
execution.23

Indeed, at the time HSLB bought the subject property, HSLB had actual knowledge of the annotated Notice of Lis Pendens. Instead of heeding the same, HSLB continued with the
purchase knowing the legal repercussions a notice of lis pendens entails. HSLB took upon itself the risk that the Notice of Lis Pendens leads to.1wphi1 As correctly found by the CA,
"the notice of lis pendens was annotated on 14 September 1995, whereas the foreclosure sale, where the appellant was declared as the highest bidder, took place sometime in 1997.
There is no doubt that at the time appellant purchased the subject property, it was aware of the pending litigation concerning the same property and thus, the title issued in its favor was
subject to the outcome of said litigation."24

This ruling is in accord with Rehabilitation Finance Corp. v. Morales,25 which underscored the significance of a lis pendens, then defined in Sec. 24, Rule 7 now Sec. 14 of Rule 13 in
relation to a mortgage priorly annotated on the title covering the property. Thus:

The notice of lis pendens in question was annotated on the back of the certificate of title as a necessary incident of the civil action to recover the ownership of the property affected by it.
The mortgage executed in favor of petitioner corporation was annotated on the same title prior to the annotation of the notice of lis pendens; but when petitioner bought the property as
the highest bidder at the auction sale made as an aftermath of the foreclosure of the mortgage, the title already bore the notice of lis pendens. Held: While the notice of lis pendens
cannot affect petitioners right as mortgagee, because the same was annotated subsequent to the mortgage, yet the said notice affects its right as purchaser because notice of lis
pendens simply means that a certain property is involved in a litigation and serves as a notice to the whole world that one who buys the same does so at his own risk.26

The subject of the lis pendens on the title of HSLBs vendor, Delgado, is the "Reformation case" filed against Delgado by the herein respondents. The case was decided with finality by
the CA in favor of herein respondents. The contract of sale in favor of Delgado was ordered reformed into a contract of mortgage. By final decision of the CA, HSLBs vendor, Delgado,
is not the property owner but only a mortgagee. As it turned out, Delgado could not have constituted a valid mortgage on the property. That the mortgagor be the absolute owner of the
thing mortgaged is an essential requisite of a contract of mortgage. Article 2085 (2) of the Civil Code specifically says so:

Art. 2085. The following requisites are essential to the contracts of pledge and mortgage:

xxxx

(2) That the pledgor or mortagagor be the absolute owner of the thing pledged or mortgaged.

Succinctly, for a valid mortgage to exist, ownership of the property is an essential requisite.27

Reyes v. De Leon28 cited the case of Philippine National Bank v. Rocha29 where it was pronounced that "a mortgage of real property executed by one who is not an owner thereof at
the time of the execution of the mortgage is without legal existence." Such that, according to DBP v. Prudential Bank,30 there being no valid mortgage, there could also be no valid
foreclosure or valid auction sale.

We go back to Bank of Commerce v. San Pablo, Jr.31 where the doctrine of mortgagee in good faith, upon which petitioner relies, was clarified as "based on the rule that all persons
dealing with property covered by the Torrens Certificate of Title, as buyers or mortgagees, are not required to go beyond what appears on the face of the title. In turn, the rule is based
on "x x x public interest in upholding the indefeasibility of a certificate of title, as evidence of lawful ownership of the land or of any encumbrance thereon."32

Insofar as the HSLB is concerned, there is no longer any public interest in upholding the indefeasibility of the certificate of title of its mortgagor, Delgado. Such title has been nullified in
a decision that had become final and executory. Its own title, derived from the foreclosure of Delgado's mortgage in its favor, has likewise been nullified in the very same decision that
restored the certificate of title in respondents' name. There is absolutely no reason that can support the prayer of HSLB to have its mortgage lien carried over and into the restored
certificate of title of respondents.

WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals in CA-G.R. CV No. 87540 is AFFIRMED.

SO ORDERED.

32. G.R. No. 172588

March 13, 2013

ISABEL N. GUZMAN, Petitioner,

vs.
ANIANO N. GUZMAN and PRIMITIVA G. MONTEALTO, Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari,1 filed by petitioner Isabel N. Guzman, assailing the February 3, 2006 decision2 and the April 17, 2006 resolution3 of the Court of
Appeals (CA) in CA-G.R. SP No. 90799. The CA decision dismissed the petitioners petition for certiorari for being the wrong mode of appeal and for lack of merit. The CA resolution
denied the petitioners motion for reconsideration for lack of merit.

THE FACTUAL ANTECEDENTS

On June 15, 2000, the petitioner filed with the Municipal Trial Court (MTC) of Tuguegarao City, Cagayan, Branch 4, a complaint for ejectment against her children, respondents Aniano
N. Guzman and Primitiva G. Montealto.4 The petitioner alleged that she and Arnold N. Guzman owned the 6/7th and 1/7th portions, respectively, of a 1,446-square meter parcel of land,
known as Lot No. 2419-B, in Tuguegarao City, Cagayan, under Transfer Certificate of Title No. T-74707;5 the respondents occupied the land by tolerance; the respondents did not
comply with her January 17, 2000 written demand to vacate the property;6 and subsequent barangay conciliation proceedings failed to settle the differences between them.7

In their answer,8 the respondents countered that the petitioner transferred, in a December 28, 1996 document,9 all her property rights in the disputed property, except her usufructuary
right, in favor of her children, and that the petitioner engaged in forum shopping since she already raised the issue of ownership in a petition for cancellation of adverse claim against the
respondents, pending with Branch 4 of the Regional Trial Court (RTC) of Tuguegarao City, Cagayan.10

THE MTCs RULING

In a November 27, 2002 decision,11 the MTC found the petitioner to be the lawful owner of the land with a right to its possession since the respondents had no vested right to the land
since they are merely the petitioners children to whom no ownership or possessory rights have passed. It held that the petitioner committed no forum shopping since she asserted
ownership only to establish her right of possession, and the lower courts can provisionally resolve the issue of ownership to determine who has the better right of possession. The MTC
directed the respondents to vacate the land and surrender possession to the petitioner, and to pay P5,000.00 as monthly rental from January 2000 until possession is surrendered,
plus P15,000.00 as moral and exemplary damages.

The respondents appealed to the RTC of Tuguegarao City, Cagayan, Branch 1.12 They argued that: (a) the MTC had no jurisdiction over the case; (b) the petitioner has no cause of
action against the respondents; (c) the petitioner engaged in forum shopping; and (d) the MTC erred in deciding the case in the petitioners favor.13

THE RTCs RULING

In its May 19, 2005 decision,14 the RTC rejected the respondents arguments, finding that the MTC has jurisdiction over ejectment cases under Section 33(2) of Batas Pambansa
Bilang 129;15 the petitioner has a valid cause of action against the respondents since the complaint alleged the petitioners ownership, the respondents possession by tolerance, and
the respondents refusal to vacate upon the petitioners demand; and, the petitioner did not engage in forum shopping since the petition for the cancellation of adverse claim has a
cause of action totally different from that of ejectment.

The RTC, however, still ruled for the respondents and set aside the MTC ruling. It took into account the petitioners transfer of rights in the respondents favor which, it held, could not be
unilaterally revoked without a court action. It also noted that the petitioner failed to allege and prove that earnest efforts at a compromise have been exerted prior to the filing of the
complaint.16 Thus, the RTC ordered the petitioner to pay the respondents P25,000.00 as attorneys fees and P25,000.00 as litigation expenses.

On June 16, 2005, the petitioner received a copy of the RTC decision.17 On June 30, 2005, the petitioner filed her first motion for reconsideration.18 In its July 6, 2005 order,19 the
RTC denied the petitioners motion for reconsideration for lack of the required notice of hearing.20

On July 14, 2005, the petitioner filed a second motion for reconsideration.21 In its July 15, 2005 order,22 the RTC denied the second motion for reconsideration for having been filed out
of time.

On July 20, 2005, the petitioner filed a third motion for reconsideration.23 In its July 22, 2005 order,24 the RTC denied the third motion for reconsideration with finality.

On August 8, 2005, the petitioner filed a Rule 65 petition for certiorari with the CA, alleging that the RTC committed a grave abuse of discretion: (a) in deciding the case based on
matters not raised as issues on appeal; (b) in finding that the transfer of rights could not be unilaterally revoked without a court action; (c) in holding that the petitioner failed to prove that
earnest efforts at a compromise have been exerted prior to the filing of the complaint; and (d) in denying the petitioners motion for reconsideration on a mere technicality.

THE CAs RULING

In its February 3, 2006 decision,25 the CA dismissed the petition. The CA noted that a Rule 42 petition for review, not a Rule 65 petition for certiorari, was the proper remedy to assail
an RTC decision rendered in the exercise of its appellate jurisdiction. It found that the petitioner lost her chance to appeal when she filed a second motion for reconsideration, a
prohibited pleading under Section 5, Rule 37 of the Rules of Court. The CA also held that the petitioner cannot validly claim that the respondents occupied the properties through mere
tolerance since they were co-owners of the property as compulsory heirs of Alfonso Guzman, the original owner.

When the CA denied26 the motion for reconsideration27 that followed, the petitioner filed the present Rule 45 petition.

THE PETITION

The petitioner justifies the filing of a Rule 65 petition for certiorari with the CA by claiming that the RTC judge acted with grave abuse of discretion in passing on issues not raised in the
appeal and in not relaxing the rule on the required notice of hearing on motions. She further argues that the CAs finding of co-ownership is bereft of factual and legal basis.

THE CASE FOR THE RESPONDENTS

The respondents submit that the proper remedy for appealing a decision of the RTC, exercising appellate jurisdiction, is a Rule 42 petition for review, and that a Rule 65 petition for
certiorari is not a substitute for a lost appeal.

THE ISSUE

The case presents to us the issue of whether the CA committed a reversible error in dismissing the petitioners petition for certiorari.

THE COURTs RULING

The petition lacks merit.

The petitioner availed of the wrong remedy

The petitioners resort to a Rule 65 petition for certiorari to assail the RTC decision and orders is misplaced. When the RTC issued its decision and orders, it did so in the exercise of its
appellate jurisdiction; the proper remedy therefrom is a Rule 42 petition for review.28 Instead, the petitioner filed a second motion for reconsideration and thereby lost her right to
appeal; a second motion for reconsideration being a prohibited pleading pursuant to Section 5, Rule 37 of the Rules of Court.29 The petitioners subsequent motions for reconsideration
should be considered as mere scraps of paper, not having been filed at all, and unable to toll the reglementary period for an appeal.

The RTC decision became final and executory after fifteen (15) days from receipt of the denial of the first motion for reconsideration. It is elementary that once a decision becomes final
and executory, it is "immutable and unalterable, and can no longer be modified in any respect, even if the modification is meant to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether the modification is attempted to be made by the court rendering it or by the highest court of the land."30 Thus, the RTC decision,
even if allegedly erroneous, can no longer be modified.

Apparently, to resurrect her lost appeal, the petitioner filed a Rule 65 petition for certiorari, imputing grave abuse of discretion on the RTC for deciding the case against her. Certiorari,
by its very nature, is proper only when appeal is not available to the aggrieved party; the remedies of appeal and certiorari are mutually exclusive, not alternative or successive.31 It
cannot substitute for a lost appeal, especially if one's own negligence or error in one's choice of remedy occasioned such loss or lapse.32

No grave abuse of discretion

In any case, even granting that the petition can be properly filed under Rule 65 of the Rules of Court, we hold that it was bound to fail.1wphi1

It should be noted that as a legal recourse, certiorari is a limited form of review.33 It is restricted to resolving errors of jurisdiction and grave abuse of discretion, not errors of
judgment.34 Indeed, as long as the lower courts act within their jurisdiction, alleged errors committed in the exercise of their discretion will amount to mere errors of judgment
correctable by an appeal or a petition for review.35

In this case, the imputed errors pertained to the RTCs appreciation of matters not raised as errors on appeal, specifically, the transfer of rights and subsequent unilateral revocation,
and the strictly enforced rule on notice of hearing. These matters involve only the RTCs appreciation of facts and its application of the law; the errors raised do not involve the RTCs
jurisdiction, but merely amount to a claim of erroneous exercise of judgment.1wphi1

Besides, the RTC acted within its jurisdiction in considering the matter of the petitioners transfer of rights, even if it had not been raised as an error. Under Section 18, Rule 70 of the
Rules of Court,36 the RTC is mandated to decide the appeal based on the entire record of the MTC proceedings and such pleadings submitted by the parties or required by the RTC.
Nonetheless, even without this provision, an appellate court is clothed with ample authority to review matters, even if they are not assigned as errors on appeal, if it finds that their
consideration is necessary in arriving at a just decision of the case, or is closely related to an error properly assigned, or upon which the determination of the question raised by error
properly assigned is dependent.37 The matter of the petitioners transfer of rights, which was in the records of the case, was the basis for the RTCs decision.

The RTC did not also commit a grave abuse of discretion in strictly enforcing the requirement of notice of hearing. The requirement of notice of hearing is an integral component of
procedural due process that seeks to avoid "surprises that may be sprung upon the adverse party, who must be given time to study and meet the arguments in the motion before a
resolution by the court."38 Given the purpose of the requirement, a motion unaccompanied by a notice of hearing is considered a mere scrap of paper that does not toll the running of
the period to appeal. This requirement of notice of hearing equally applies to the petitioners motion for reconsideration.39 The petitioners alleged absence of counsel is not a valid
excuse or reason for non-compliance with the rules.

A final point

Ejectment cases are summary proceedings intended to provided an expeditious means of protecting actual possession or right of possession of property. Title is not involved, hence, it
is a special civil action with a special procedure. The only issue to be resolved in ejectment cases is the question of entitlement to the physical or material possession of the premises or
possession de facto. Thus, any ruling on the question of ownership is only provisional, made solely for the purpose of determining who is entitled to possession de facto.40 Accordingly,
any ruling on the validity of the petitioners transfer of rights is provisional and should be resolved in a proper proceeding.

WHEREFORE, we hereby DENY the appeal. The February 3, 2006 decision and the April 17, 2006 resolution of the Court of Appeals in CA- G.R. SP No. 90799 are AFFIRMED. Costs
against petitioner Isabel N. Guzman.

SO ORDERED.

33. G.R. No. 180269

February 20, 2013

JOSE Z. CASILANG, SR., substituted by his heirs, namely: FELICIDAD CUD lAMA T VDA. DE CASILANG, JOSE C. CASILANG, JR., RICARDO C. CASILANG, MARIA
LOURDES C. CASILANG, CHRISTOPHER C. CASILANG, BEN C. CASILANG, DANTE C. CASILANG, GREGORIO C. CASILANG, HERALD C. CASILANG; and FELICIDAD Z.
CASILANG, MARCELINA Z. CASILANG, JACINTA Z. CASILANG, BONIFACIO Z. CASILANG, LEONORA Z. CASILANG, and FLORA Z. CASILANG, Petitioners,
vs.
ROSARIO Z. CASILANG-DIZON, MARIO A. CASILANG, ANGELO A. CASILANG, RODOLFO A. CASILANG, and ATTY. ALICIA B. FABIA, in her capacity as Clerk of Court and
Ex-Officio Sheriff of Pangasinan and/or her duly authorized representative, Respondents.

DECISION

REYES, J.:

Before us is a petition for review of the Decision1 dated July 19, 2007 of the Court of Appeals (CA) in CA-G.R. CV No. 79619, which reversed and set aside the Decision2 dated April
21, 2003 of the Regional Trial Court (RTC) of Dagupan City, Branch 41, in Civil Case No. 98-02371-D.

Antecedent Facts

The late spouses Liborio Casilang (Liborio) and Francisca Zacarias (Francisca) had eight (8) children, namely: Felicidad Casilang (Felicidad), Ireneo Casilang (Ireneo), Marcelina
Casilang (Marcelina), Jacinta Casilang (Jacinta), Bonifacio Casilang (Bonifacio), Leonora Casilang (Leonora), Jose Casilang (Jose) and Flora Casilang (Flora). Liborio died intestate on
October 11, 1982 at the age of 83, followed not long after by his wife Francisca on December 25, 1982. Their son Bonifacio also died in 1986, survived by his child Bernabe Casilang
(Bernabe), while son Ireneo died on June 11, 1992, survived by his four (4) children, namely: Mario Casilang (Mario), Angelo Casilang (Angelo), Rosario Casilang-Dizon (Rosario) and
Rodolfo Casilang (Rodolfo), herein respondents.

The estate of Liborio, which left no debts, consisted of three (3) parcels of land located in Barangay Talibaew, Calasiao, Pangasinan, namely: (1) Lot No. 4676, with an area of 4,164
square meters; (2) Lot No. 4704, containing 1,164 sq m; and (3) Lot No. 4618, with 897 sq m.

On May 26, 1997, respondent Rosario filed with the Municipal Trial Court (MTC) of Calasiao, Pangasinan a complaint for unlawful detainer, docketed as Civil Case No. 847, to evict her
uncle, petitioner Jose from Lot No. 4618. Rosario claimed that Lot No. 4618 was owned by her father Ireneo, as evidenced by Tax Declaration (TD) No. 555 issued in 1994 under her
fathers name. On April 3, 1997, the respondents executed a Deed of Extrajudicial Partition with Quitclaim3 whereby they adjudicated Lot No. 4618 to themselves. In the same
instrument, respondents Mario, Angelo and Rodolfo renounced their respective shares in Lot No. 4618 in favor of Rosario.

In his Answer, Jose raised the defense that he was the "lawful, absolute, exclusive owner and in actual possession" of the said lot, and that he acquired the same "through intestate
succession from his late father."4 For some reason, however, he and his lawyer, who was from the Public Attorneys Office, failed to appear at the scheduled pre-trial conference, and
Jose was declared in default; thus, the adverse judgment against him.5

On February 18, 1998, the MTC rendered judgment finding Rosario to be the owner of Lot No. 4618, and ordering Jose to remove his house, vacate Lot No. 4618, and pay
Rosario P500.00 in monthly rentals from the filing of the complaint until she was placed in possession, plus attorneys fees of P5,000.00, litigation expenses and costs. On March 23,
1998, the MTC issued a writ of execution; and on August 28, 1998, a Writ of Demolition6 was issued.

On June 2, 1998, the petitioners, counting 7 of the 8 children of Liborio and Francisca,7 filed with the RTC of Dagupan City a Complaint,8 docketed as Civil Case No. 98-02371-D for
"Annulment of Documents, Ownership and Peaceful Possession with Damages" against the respondents. On June 10, 1998, the petitioners moved for the issuance of a writ of
preliminary injunction or temporary restraining order, which the RTC however denied on June 23, 1998.

Among the documents sought to be annulled was the 1997 Deed of Extrajudicial Partition executed by Ireneos children over Lot No. 4618, as well as TD No. 555, and by necessary
implication its derivatives, TD No. 15177 (for the lot) and TD No. 15176 (for the house), both of which were issued in 1998 in the name of Rosario Casilang-Dizon.9

The petitioners alleged in their complaint that all eight (8) children of Liborio entered into a verbal partition of his estate, pursuant to which Jose was allotted Lot No. 4618 as his share;
that Ireneo never claimed ownership of Lot No. 4618, nor took possession of it, because his share was the southwestern 1/5 portion of Lot No. 4676, containing an area of 1,308 sq

m,10 of which he took exclusive possession during his lifetime; that Jose has always resided in Lot No. 4618 since childhood, where he built his familys semi-concrete house just a few
steps away from his parents old bamboo hut; that he took in and cared for his aged parents in his house until their deaths in 1982; that one of his children has also built a house on the
lot.11 Jose, said to be the most educated of the Casilang siblings, worked as an insurance agent.12 The complete disposition of the intestate estate of Liborio per the parties verbal
partition appears as follows:

1. Lot No. 4676, with 4,164 sq m, declared under TD No. 534 in Liborios name,13 was verbally partitioned among Marcelina (236 sq m), Leonora (1,965 sq m), Flora (655
sq m), and Ireneo, represented by his children, the herein respondents-defendants (1,308 sq m), as shown in a Deed of Extrajudicial Partition with Quitclaim dated
January 8, 1998, subsequently executed by all the Casilang siblings and their representatives.

2. Lot No. 4704, with 1,164 sq m, declared under TD No. 276 in Liborios name,14 was divided among Jacinta and Bonifacio, who died in 1986 and is now represented by
his son Bernabe; and

3. Lot No. 4618, containing 897 sq m, declared since 1994 under TD No. 555 in Ireneos name,15 is now the subject of the controversy below. Jose insists that he
succeeded to it per verbal partition, and that he and his family have always occupied the same peacefully, adversely and exclusively even while their parents were
alive.16

For her part, Rosario alleged in her answer with counterclaim,17 which she filed on September 15, 1998, that:

a) She is the actual and lawful owner of Lot No. 4618 with an area of 897 square meters, having acquired the same by way of a Deed of Extra judicial Partition with
Quitclaim dated 3 April 1997 which was duly executed among herein Appellant ROSARIO and her brothers, namely, MARIO, ANGELO and RODOLFO, all surnamed
CASILANG;

b) Her ownership over subject property could be traced back to her late father IR[E]NEO which the latter inherited by way of intestate succession from his deceased father
LIBORIO sometime in 1992; that the residential house described in herein Appellee JOSEs complaint is an illegal structure built by him in 1997 without her (ROSARIOs)
knowledge and consent; that in fact, an ejectment suit was filed against Appellee JOSE with the Municipal Trial Court in Calasiao, Pangasinan in Civil Case No. 847;

c) The subject lot is never a portion of Appellee JOSEs share from the intestate of his deceased father, LIBORIO; that on the contrary, the lot is his deceased brother
IR[E]NEOs share from the late LIBORIOs intestate estate; that in fact, the property has long been declared in the name of the late IRENEO as shown by Tax Declaration
No. 555 long before his children ROSARIO DIZON, MARIO, ANGELO and RODOLFO, all surnamed CASILANG, executed the Deed of Partition dated 18 February 1998;
that Appellee JOSE had actually consumed his shares which he inherited from his late father, and after a series of sales and dispositions of the same made by him, he
now wants to take Appellants property;

d) Appellee JOSE is never the rightful owner of the lot in question and has not shown any convincing proof of his supposed ownership; that the improvements introduced
by him, specifically the structures he cited are the subject of a Writ of Demolition dated 28 August 1998 pursuant to the Order dated 17 August 1998 of the MTC of
Calasiao, Pangasinan;

e) No protestation or objection was ever made by Appellee JOSE in Civil Case No. 847 (Unlawful Detainercase) where he was the defendant; that the truth was that his
possession of the subject property was upon the tolerance and benevolence of his late brother IRENEO during the latters lifetime and that Appellant ROSARIO;

f) The RTC Clerk of Court and Ex-officio Provincial Sheriff would just be doing her job if she and her deputies would implement the writ of execution/demolition issued by
the MTC of Calasiao, Pangasinan since it is its ministerial duty to do so;

g) The Appellees have no cause of action; not having shown in their complaint the basis, the reason and the very core of their claim as to why the questioned document
should be nullified.18 (Citation omitted)

In their reply19 to Rosarios aforesaid answer, the petitioners asserted that the MTC committed a grave error in failing to consider a material fact-that Jose had long been in prior
possession under a claim of title which he obtained by partition.

At the pre-trial conference in Civil Case No. 98-02371-D, the parties entered into the following stipulations:

1. That the late LIBORIO is the father of FELICIDAD, MARCELINA, JUANITA, LEONORA, FLORA and IRENEO, all surnamed CASILANG;

2. That the late LIBORIO died in 1982; That the late LIBORIO and his family resided on Lot [No.] 4618 up to his death in 1982; That the house of the late LIBORIO is
located on Lot [No.] 4618;

3. That Plaintiff JOSE used to reside on the lot in question because there was a case for ejectment filed against him;

4. That the house which was demolished is the family house of the late LIBORIO and FRANCISCA ZACARIAS with the qualification that it was given to the defendants;

5. That the action involves members of the same family; and

6. That no earnest efforts were made prior to the institution of the case in court.20

Ruling of the RTC

After a full trial on the merits, the RTC in its Decision21 dated April 21, 2003 decreed as follows:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendants as follows:

1. Declaring the Deed of Extrajudicial Partition with Quitclaim dated April 3, 1997 null and void;

2. Declaring plaintiff Jose Z. Casilang Sr. as the lawful owner and possessor of the subject Lot No. 4618 and as such, entitled to the peaceful possession of the same;

3. Ordering the defendants to pay to plaintiff Jose Z. Casilang Sr. attorneys fees in the amount of P20,000.00 and litigation expenses in the amount of P5,000.00, and to
pay the costs of suit.

SO ORDERED.22

The RTC affirmed Joses ownership and possession of Lot No. 4618 by virtue of the oral partition of the estate of Liborio by all the siblings. In the Deed of Extrajudicial Partition with
Quitclaim23 dated January 8, 1998, subsequently executed by all the eight (8) Casilang siblings and their legal representativeswith Ireneo represented by his four (4) children, and
Bonifacio by his son Bernabepetitioners Jose, Felicidad, Jacinta and Bernabe, acknowledged that they had already received their respective shares of inheritance in
advance,"24 and therefore,renounced their claims over Lot No. 4676 in favor of co-heirs Marcelina, Leonora, Flora and Ireneo, as follows:

We hereby RENOUNCED, WAIVED AND QUITCLAIM, all our rights, interests and participations over the WHOLE parcel of land [Lot No. 4676], left by the late, LIBORIO CASILANG, in
favor of our coheirs, namely: MARCELINA Z. CASILANG-PARAYNO, LEONORA Z. CASILANG-SARMIENTO, FLORA Z. CASILANG, MARIO A. CASILANG, ANGELO A. CASILANG,
ROSARIO A. CASILANGDIZON AND RODOLFO A. CASILANG.25

Thus, Jose expressly renounced his share in Lot No. 4676, which has an area of 4,164 sq m, because he had already received in advance his share in his fathers estate, Lot No. 4618
with 897 sq m:

To the mind of the court, Jose Casilang could have not [sic] renounced and waived his rights and interests over Lot [No.] 4676 if he believes that Lot [No.] 4618 is not his, while the
other lot, Lot [No.] 470[4], was divided between sister Jacinta Casilang and brother Bonifacio Casilang[,] Sr., who was represented by his son. In the same [way] as testified to by
plaintiffs Felicidad Casilang and Jacinta Casilang, they signed the Deed of Extrajudicial Partition with Quitclaim wherein they waived and renounced their rights and interests over Lot
[No.] 4676 because they have already received their share, which is Lot [No.] 470[4].26

The RTC found baseless the claim of Rosario that Lot No. 4618 was an inheritance of her father Ireneo considering that a tax declaration is not conclusive proof of ownership. The RTC
even noted that the tax declaration of Ireneo started only in 1994, although he had been dead since 1992. "Such being the case, the heirs of Ir[e]neo Casilang has [sic] no basis in
adjudicating unto themselves Lot No. 4618 and partitioning the same by executing the Deed of Extrajudicial Partition with Quitclaim."27

Appeal to the CA

Undeterred, Rosario appealed to the CA averring that: (1) the lower court erred in declaring the Deed of Extrajudicial Partition with Quitclaim dated April 3, 1997 as null and void; and (2)
the lower court erred in declaring Jose as the lawful owner and possessor of the subject Lot No. 4618.28

In the now assailed decision, the CA reversed the RTC by relying mainly on the factual findings and conclusions of the MTC in Civil Case No. 847, viz:

Per the records, the above described property was subject of Civil Case No. 847 decided by the MTC of Calasiao, First Judicial Region, Province of Pangasinan which rendered a
judgment, supra, in favor of Appellant ROSARIO ordering herein Appellee JOSE and all persons claiming rights under him to vacate the land of Appellant ROSARIO. It was found by
the MTC that the latter is the owner of the subject parcel of land located at Talibaew, Calasiao, Pangasinan; that the former owner of the land is the late IRENEO (who died on 11 June
1992), father of Appellant ROSARIO; that Extra Judicial Partition with Quitclaim was executed by and among the heirs of the late IRENEO; that MAURO [sic], ANGELO and RODOLFO,
all surnamed CASILANG waived and quitclaimed their respective shares over the subject property in favor of Appellant ROSARIO; that Appellee JOSE was allowed by the late IRENEO
during his lifetime to occupy a portion of the land without a contract of lease and no rentals being paid by the former; that Appellant ROSARIO allowed Appellee JOSE to continue
occupying the land after the Extra Judicial Partition with Quitclaim was executed.29

Moreover, noting that the decision in Civil Case No. 847 in favor of Rosario was issued on February 18, 1998 while the petitioners complaint in Civil Case No. 98-02371-D was filed on
June 2, 1998, the CA concluded that the latter case was a mere afterthought:

If the latter has really a strong and valid reason to question the validity of the Deed of Extra Judicial Partition with Quitclaim, supra, he could have done it soon after the said Deed was
executed on 3 April 1997. However, curiously enough, it was only when the MTC ordered his eviction from the subject property that he decided to file the instant case against the
Appellants.30

Petition for Review in the Supreme Court

Now in this petition for review on certiorari, petitioners maintain that:

IN UPHOLDING THE LEGALITY [OF] THE DEED OF EXTRAJUDICIAL PARTITION AND QUITCLAIM DATED APRIL 3, 1997, THE HONORABLE COURT OF APPEALS GROSSLY
VIOLATED THE SUBSTANTIVE RIGHT OF JOSE Z. CASILANG, SR. AS DIRECT COMPULSORY HEIR.31

Our Ruling and Discussions

There is merit in the petition.

Inferior courts are empowered to rule on the question of ownership raised by the defendant in an ejectment suit, but only to resolve the issue of possession; its
determination is not conclusive on the issue of ownership.

It is well to be reminded of the settled distinction between a summary action of ejectment and a plenary action for recovery of possession and/or ownership of the land. What really
distinguishes an action for unlawful detainer from a possessory action (accion publiciana) and from a reinvindicatory action (accion reinvindicatoria) is that the first is limited to the
question of possession de facto. Unlawful detainer suits (accion interdictal) together with forcible entry are the two forms of ejectment suit that may be filed to recover possession of real
property. Aside from the summary action of ejectment, accion publiciana or the plenary action to recover the right of possession and accion reinvindicatoria or the action to recover
ownership which also includes recovery of possession, make up the three kinds of actions to judicially recover possession.32

Under Section 3 of Rule 70 of the Rules of Court, the Summary Procedure governs the two forms of ejectment suit, the purpose being to provide an expeditious means of protecting
actual possession or right to possession of the property. They are not processes to determine the actual title to an estate. If at all, inferior courts are empowered to rule on the question
of ownership raised by the defendant in such suits, only to resolve the issue of possession and its determination on the ownership issue is not conclusive.33 As thus provided in Section
16 of Rule 70:

Sec. 16. Resolving defense of ownership.When the defendant raises the defense of ownership in his pleadings and the question of possession cannot be resolved without deciding
the issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession.

It is apropos, then, to note that in contrast to Civil Case No. 847, which is an ejectment case, Civil Case No. 98-02371-D is for "Annulment of Documents, Ownership and Peaceful
Possession;" it is an accion reinvindicatoria, or action to recover ownership, which necessarily includes recovery of possession34 as an incident thereof. Jose asserts his ownership
over Lot No. 4618 under a partition agreement with his co-heirs, and seeks to invalidate Ireneos "claim" over Lot No. 4618 and to declare TD No. 555 void, and consequently, to annul
the Deed of Extrajudicial Partition and Quitclaim executed by Ireneos heirs.

It is imperative to review the CAs factual conclusions since they are entirely contrary to those of the RTC, they have no citation of specific supporting evidence, and are
premised on the supposed absence of evidence, particularly on the parties verbal partition, but are directly contradicted by the evidence on record.

It must be noted that the factual findings of the MTC, which the CA adopted without question, were obtained through Summary Procedure and were based solely on the complaint and
affidavits of Rosario, after Jose had been declared in default. But since a full trial was had in Civil Case No. 98-02371-D, the CA should have pointed out the specific errors and
weaknesses in the RTCs factual conclusions before it could rule that Jose was unable to present "any evidentiary support" to establish his title, and that his continued possession of Lot
No. 4618 was by mere tolerance of Rosario. At most, however, the CA only opined that it was conjectural for the RTC to conclude, that Jose had already received his inheritance when
he renounced his share in Lot No. 4676. It then ruled that the RTC erred in not considering the findings of the MTC in Civil Case No. 847-that Joses possession over subject property
was by mere tolerance. Said the appellate court:

Given the claim of the Appellee that Lot [No.] 4618 was orally given/assigned to him by his deceased father LIBORIO, or that his claim was corroborated by his sisters (his co-plaintiffsAppellees), or that their claim is indubitably tied up with the Deed of Extrajudicial Partition with Quitclaim over Lot No. 4676, still We cannot fully agree with the pronouncement of the
court a quo that Appellee JOSE could not have renounced and waived his rights and interest over Lot [No.] 4676 if he believes that Lot [No.] 4618 is not his. Wanting any evidentiary
support, We find this stance as conjectural being unsubstantiated by law or convincing evidence. At the most and taking the factual or legal circumstances as shown by the records, We
hold that the court a quo erred in not considering the findings of the MTC in Civil Case No. 847 ruling that herein Appellee JOSEs possession over subject property was by mere
tolerance. Based as it is on mere tolerance, Appellee JOSEs possession therefore could not, in any way, ripen into ownership.35 (Citations omitted)

By relying solely on the MTCs findings, the CA completely ignored the testimonial, documentary and circumstantial evidence of the petitioners, obtained by the RTC after a full trial on
the merits. More importantly, the CA did not point to any evidence of Rosario that Ireneo had inherited Lot No. 4618 from Liborio. All it did was adopt the findings of the MTC.

The Supreme Court is not a trier of facts, and unless the case falls under any of the well-defined exceptions, the Supreme Court will not delve once more into the findings of facts.
In Sps. Sta. Maria v. CA,36 this Court stated:

Settled is the rule that the jurisdiction of this Court in cases brought before it from the Court of Appeals via Rule 45 of the Rules of Court is limited to reviewing errors of law. Findings of
fact of the latter are conclusive, except in the following instances: (1) when the findings are grounded entirely on speculation, surmises, or conjectures; (2) when the inference made is
manifestly mistaken, absurd, or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are
conflicting; (6) when in making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee;
(7) when the findings are contrary to those of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set
forth in the petition as well as in the petitioners main and reply briefs are not disputed by the respondent; and (10) when the findings of fact are premised on the supposed absence of
evidence and contradicted by the evidence on record.37 (Citation omitted)

In the instant case, the factual findings of the CA and the RTC are starkly contrasting. Moreover, we find that the CA decision falls under exceptions (7), (8) and (10) above, which
warrants another review of its factual findings.

The evidence supporting Rosarios claim of sole ownership of Lot No. 4618 is the Deed of Extrajudicial Partition with Quitclaim, which she executed with her brothers Mario, Angelo and
Rodolfo. There is no question that by itself, the said document would have fully conveyed to Rosario whatever rights her brothers might have in Lot No. 4618. But what needs to be
established first is whether or not Ireneo did in fact own Lot No. 4618 through succession, as Rosario claims. And here now lies the very crux of the controversy.

A review of the parties evidence shows that they entered into an oral partition, giving Lot No. 4618 to Jose as his share, whereas Rosario presented no proof whatsoever
that her father inherited Lot No. 4618 from his father Liborio.

Rosarios only proof of Ireneos ownership is TD No. 555, issued in his name, but she did not bother to explain why it was dated 1994, although Ireneo died on June 11, 1992. Liborios
ownership of Lot No. 4618 is admitted by all the parties, but it must be asked whether in his lifetime Liborio did in fact transmit it to Ireneo, and if not, whether it was conveyed to him by
Liborios heirs. It is imperative for Rosario to have presented proof of this transfer to Ireneo, in such a form as would have vested ownership in him. We find, instead, a preponderance of
contrary evidence.

1. In his testimony, Jose claimed that his parents bamboo house in Lot No. 4618 disintegrated from wear and tear; so he took them in to his semi-concrete house in the
same lot, which was just a few steps away, and he cared for them until they died; shortly before Liborios death, and in the presence of all his siblings, his father Liborio
assigned Lot No. 4618 to him as his inheritance; his house was demolished in 1998 as a result of the ejectment case filed against him; but his family continued to live
thereat after reconstructing the house; Ireneo and his family did not live in Lot No. 4618; although Joses job as an insurance agent took him around Pangasinan, he
always came home to his family in his house in Lot No. 4618, which he used as his permanent address; only Lot No. 4676 was included in the Deed of Extrajudicial
Partition dated January 8, 1998 because Lot No. 4618 had already been distributed to Jose, and Lot No. 4704 had already been assigned to Jacinta and Bonifacio as
their share in their fathers estate.38

2. Joses testimony was corroborated by petitioners Felicidad,39 Jacinta,40 Leonora,41 and Flora,42 who all confirmed that their brother Jose has always resided in Lot
No. 4618 from his childhood up to the present, that he took their aged parents into his house after their bamboo house was destroyed, and he attended to their needs until
they died in 1982. The sisters were also one in saying that their father Liborio verbally willed Lot No. 4618 to Jose as his share in his estate, and that their actual partition
affirmed their fathers dispositions. Jacinta claimed that she and Bonifacio have since taken possession of Lot No. 4704 pursuant to their partition, and have also declared
their respective portions for tax purposes.43 Flora corroborated Jacinta on their taking possession of Lot No. 4704, as well as that Jose built his house on Lot No. 4618
next to his parents and they came to live with him in their old age. Flora affirmed that Exhibit "F" correctly reflects their verbal partition of Lot No. 4676, and that she was
fully in accord with it. She added that Felicidad and Marcelina had since constructed their own houses on the portions of Lot No. 4676 assigned to them.44Felicidad
mentioned that in their partition, Ireneo was given a portion of Lot No. 4676, while Lot No. 4704 was divided between Jacinta and Bonifacio, and Jose alone got Lot No.
4618. Leonora confirmed that they were all present when their father made his above dispositions of his estate.

3. Benjamin Lorenzo, a long-time neighbor of the Casilangs testified that Joses house stands on Lot No. 4618 and Ireneo did not live with his family on the said lot but
was a tenant in another farm some distance away.45

4. For her part, Rosario merely asserted that her father Ireneo succeeded to Lot No. 4618 from Liborio, as shown in TD No. 555 (Exhibit "1"); that she and her brothers
extra-judicially settled Ireneos estate, and that they each waived their shares in her favor; and, that she has been paying taxes on Lot No. 4618. Rosario admitted,
however, that Jose has lived in the lot since he was a child, and he has reconstructed his house thereon after its court-ordered demolition.46 But Rosario on crossexamination backtracked by claiming that it was her father Ireneo and grandfather Liborio who built the old house in Lot No. 4618, where Ireneo resided until his death; he
even planted various fruit trees. Yet, there is no mention whatsoever to this effect by any of the witnesses. Rosario also contradicted herself when she denied that Jose
lived there because his job as insurance agent took him away often and yet admitted that Joses house stands there, which he reconstructed after it was ordered
demolished by the MTC. Inexplicably, Rosario disclaimed knowledge of Ireneos share in Lot No. 4676, although she was a signatory, along with her brothers and all the
petitioners, in the deed of partition of the said lot, whereby she got 1,308 sq m. Rosario also admitted that taxes were paid on the lot only beginning in 1997, not before.47

5. Benjamin Dizon, husband of Rosario, testified that Rosario was losing appetite and sleep because of the case filed by Jose; that Ireneo died in another farm; that
Ireneo had a house in Lot No. 4618 but Jose took over the house after he died in 1992.48 Respondent Angelo, brother of Rosario, claimed that when he was 13 or 14
years old, he heard his grandfather tell his father Ireneo that he would inherit Lot No. 4618. On cross-examination, Angelo insisted that his father had always lived with his
family in his grandfathers house in Lot No. 4618, that Jose did not live there but was given another lot, although he could not say which lot it was; he admitted that his
grandmother lived with Jose when she died, and Ireneos share was in Lot No. 4676.49

6. On rebuttal, Jose recounted that after his four children were married, Ireneo lived as a tenant in another farm; that during a period of illness he lived in Manila for some
time, and later resided in Cagayan with his two married sons; and lastly on his return, worked as a tenant of the Maningding family for about 10 years in Calasiao, staying
in a hut one kilometer away. Jose also claimed that Ireneo had asked Liborio for a portion of Lot No. 4676, a lot which is bigger than Lot No. 4618 by several hundreds of
square meters.50

7. On sur-rebuttal, Rosario claimed that her grandparents, father and mother lived in Lot No. 4618 when she was a child until she married and left in 1976; that her uncle
Jose asked permission from Liborio to be allowed to stay there with his family. She admitted that Jose built his house in 1985, three years after Liborio died, but as if to
correct herself, she also claimed that Jose built his house in Lot No. 4676, and not in Lot No. 4618. (Contrarily, her aunt Leonora testified that Jose built his house in Lot
No. 4618 while their parents were alive.)51 Moreover, if such was the case, Rosario did not explain why she filed Civil Case No. 847, if she thought her uncle built his
house in Lot No. 4676, and not in Lot No. 4618.52 Rosario also claimed that Ireneo always came home in the evenings to his father Liborios house from the Maningding
farm, which he tenanted for 10 years, but obviously, by then Liborios house had long been gone. Again, confusedly, Rosario denied that she knew of her fathers share in
Lot No. 4676.

From the testimonies of the parties, we are convinced that the conclusion of the RTC is well-supported that there was indeed a verbal partition among the heirs of Liborio, pursuant to
which each of his eight children received his or her share of his estate, and that Joses share was Lot No. 4618.

The parties verbal partition is valid, and has been ratified by their taking possession of their respective shares.

The validity of an oral partition is well-settled in our jurisdiction. In Vda. de Espina v. Abaya,53 this Court declared that an oral partition is valid:

Anent the issue of oral partition, We sustain the validity of said partition. "An agreement of partition may be made orally or in writing. An oral agreement for the partition of the property
owned in common is valid and enforceable upon the parties. The Statute of Frauds has no operation in this kind of agreements, for partition is not a conveyance of property but simply a
segregation and designation of the part of the property which belong to the co-owners."54

In Maestrado v. CA,55 the Supreme Court upheld the partition after it found that it conformed to the alleged oral partition of the heirs, and that the oral partition was confirmed by the
notarized quitclaims executed by the heirs subsequently.56 In Maglucot-Aw v. Maglucot,57 the Supreme Court elaborated on the validity of parol partition:

On general principle, independent and in spite of the statute of frauds, courts of equity have enforce [sic] oral partition when it has been completely or partly performed.

Regardless of whether a parol partition or agreement to partition is valid and enforceable at law, equity will [in] proper cases, where the parol partition has actually been consummated
by the taking of possession in severalty and the exercise of ownership by the parties of the respective portions set off to each, recognize and enforce such parol partition and the rights
of the parties thereunder. Thus, it has been held or stated in a number of cases involving an oral partition under which the parties went into possession, exercised acts of ownership, or
otherwise partly performed the partition agreement, that equity will confirm such partition and in a proper case decree title in accordance with the possession in severalty.

In numerous cases it has been held or stated that parol partition may be sustained on the ground of estoppel of the parties to assert the rights of a tenant in common as to parts of land
divided by parol partition as to which possession in severalty was taken and acts of individual ownership were exercised. And a court of equity will recognize the agreement and decree
it to be valid and effectual for the purpose of concluding the right of the parties as between each other to hold their respective parts in severalty.

A parol partition may also be sustained on the ground that the parties thereto have acquiesced in and ratified the partition by taking possession in severalty, exercising acts of
ownership with respect thereto, or otherwise recognizing the existence of the partition.

A number of cases have specifically applied the doctrine of part performance, or have stated that a part performance is necessary, to take a parol partition out of the operation of the
statute of frauds. It has been held that where there was a partition in fact between tenants in common, and a part performance, a court of equity would have regard to and enforce such
partition agreed to by the parties.58

Joses possession of Lot No. 4618 under a claim of ownership is well borne out by the records. It is also consistent with the claimed verbal partition with his siblings, and fully
corroborated by his sisters Felicidad, Jacinta, Leonora, and Flora, who further testified that they each had taken possession of their own shares and built their houses thereon.

A possessor of real estate property is presumed to have title thereto unless the adverse claimant establishes a better right.59 Moreover, under Article 541 of the Civil Code, one who
possesses in the concept of owner has in his favor the legal presumption that he possesses with a just title, and he cannot be obliged to show or prove it. Similarly, Article 433 of the
Civil Code provides that actual possession under a claim of ownership raises a disputable presumption of ownership. Thus, actual possession and exercise of dominion over definite
portions of the property in accordance with an alleged partition are considered strong proof of an oral partition60 which the Court will not hesitate to uphold.

Tax declarations and tax receipts are not conclusive evidence of ownership.

It is settled that tax declarations and tax receipts alone are not conclusive evidence of ownership. They are merelyindicia of a claim of ownership,61 but when coupled with proof of
actual possession of the property, they can be the basis of claim of ownership through prescription.62 In the absence of actual, public and adverse possession, the declaration of the
land for tax purposes does not prove ownership.63 We have seen that there is no proof that Liborio, or the Casilang siblings conveyed Lot No. 4618 to Ireneo. There is also no proof
that Ireneo himself declared Lot No. 4618 for tax purposes, and even if he or his heirs did, this is not enough basis to claim ownership over the subject property. The Court notes that
TO No. 555 was issued only in 1994, two years after Ireneo's death. Rosario even admitted that she began paying taxes only in 1997.64 More impmiantly, Ireneo never claimed Lot No.
4618 nor took possession of it in the concept of owner.

WHEREFORE, premises considered, the Petition is GRANTED. The Decision dated July 19, 2007 of the Court of Appeals in CA-G.R. CV No. 79619 is hereby REVERSED and SET
ASIDE, and the Decision dated April 21, 2003 of the Regional Trial Court of Dagupan City, Branch 41 in Civil Case No. 98-02371-D is REINSTATED.

SO ORDERED.

34. G.R. No. 174436

January 23, 2013

JUANITA ERMITAO, represented by her Attorney-in-Fact, ISABELO ERMITAO, Petitioner,

vs.
LAILANIE M. PAGLAS, Respondent.

DECISION

PERALTA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Decision1 and Resolution2 dated September 8, 2004 and
August 16, 2006, respectively, of the Court of Appeals (CA) in CA-G.R. SP No. 77617.

On November 5, 1999, herein respondent and petitioner, through her representative, lsabelo R. Ermitao, executed a Contract of Lease wherein petitioner leased in favor of respondent
a 336 square meter residential lot and a house standing thereon located at No. 20 Columbia St., Phase l, Doa Vicenta Village, Davao City. The contract period is one (1) year, which
commenced on November 4, 1999, with a monthly rental rate of P13,500.00. Pursuant to the contract, respondent paid petitioner P2,000.00 as security deposit to answer for unpaid
rentals and damage that may be cause to the leased unit.

Subsequent to the execution of the lease contract, respondent received information that sometime in March 1999, petitioner mortgaged the subject property in favor of a certain Charlie
Yap (Yap) and that the same was already foreclosed with Yap as the purchaser of the disputed lot in an extra-judicial foreclosure sale which was registered on February 22, 2000. Yap's
brother later offered to sell the subject property to respondent. Respondent entertained the said offer and negotiations ensued. On June 1, 2000, respondent bought the subject property
from Yap forP950,000.00. A Deed of Sale of Real Property was executed by the parties as evidence of the contract. However, it was made clear in the said Deed that the property was
still subject to petitioner's right of redemption.

Prior to respondent's purchase of the subject property, petitioner filed a suit for the declaration of nullity of the mortgage in favor of Yap as well as the sheriff's provisional certificate of
sale which was issued after the disputed house and lot were sold on foreclosure.

Meanwhile, on May 25, 2000, petitioner sent a letter demanding respondent to pay the rentals which are due and to vacate the leased premises. A second demand letter was sent on
March 25, 2001. Respondent ignored both letters.

On August 13, 2001, petitioner filed with the Municipal Trial Court in Cities (MTCC), Davao City, a case of unlawful detainer against respondent.

In its Decision dated November 26, 2001, the MTCC, Branch 6, Davao City dismissed the case filed by petitioner and awarded respondent the amounts of P25,000.00 as attorney's fees
and P2,000.00 as appearance fee.

Petitioner filed an appeal with the Regional Trial Court (RTC) of Davao City.

On February 14, 2003, the RTC rendered its Decision, the dispositive portion of which reads as follows:

WHEREFORE, PREMISES CONSIDERED, the assailed Decision is AFFIRMED with MODIFICATION. AFFIRMED insofar as it dismissed the case for unlawful detainer but modified in
that the award of attorney's fees in defendant's herein respondent's favor is deleted and that the defendant respondent is ordered to pay plaintiff herein petitioner the equivalent of ten
months unpaid rentals on the property or the total sum of P135,000.00.

SO ORDERED.3

The RTC held that herein respondent possesses the right to redeem the subject property and that, pending expiration of the redemption period, she is entitled to receive the rents,
earnings and income derived from the property.

Aggrieved by the Decision of the RTC, petitioner filed a petition for review with the CA.

On September 8, 2004, the CA rendered its assailed Decision disposing, thus:

WHEREFORE, premises considered, the assailed Decision of the Regional Trial Court, Branch 16, 11th Judicial Region, Davao City is AFFIRMED with the MODIFICATIONS as
follows:

(a) Private respondent's obligation to pay the petitioner the amount of ONE HUNDRED THIRTY-FIVE THOUSAND PESOS (P135,000.00) equivalent of ten (10) months is
hereby DELETED;

(b) Attorney's fees and litigation expenses were correctly awarded by the trial court having compelled the private respondent to litigate and incur expenses to protect her
interests by reason of the unjustified act of petitioner (Producers Bank of the Philippines vs. Court of Appeals, 365 SCRA 326), Thus: litigation expenses of only TEN
THOUSAND PESOS (P10,000.00) not TWENTY-FIVE THOUSAND PESOS (P25,000.00); and

(c) Attorney's fees REI NSTAT ED in the amount of TEN THOUSAND PESOS (P10,000.00) instead of only TWO THOUSAND PESOS (P2,000.00).

SO ORDERED.4

Quoting extensively from the decision of the MTCC as well as on respondent's comment on the petition for review, the CA ruled that respondent did not act in bad faith when she bought
the property in question because she had every right to rely on the validity of the documents evidencing the mortgage and the foreclosure proceedings.

Petitioner filed a Motion for Reconsideration, but the CA denied it in its Resolution dated August 16, 2006.

Hence, the instant petition for review on certiorari raising the following assignment of errors:

A.WHETHER OR NOT THE COURT OF APPEALS ERRED IN DISMISSING THE UNLAWFUL DETAINER CASE BY RULING THAT A SHERIFF'S FINAL CERTIFICATE
OF SALE WAS ALREADY ISSUED WHICH DECISION IS NOT BASED ON THE EVIDENCE AND IN ACCORDANCE WITH THE APPLICABLE LAWS AND
JURISPRUDENCE.

B. WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT RULED THAT PRIVATE RESPONDENT WAS A BUYER IN GOOD FAITH EVEN IF SHE WAS
INFORMED BY PETITIONER THROUGH A LETTER ADVISING HER THAT THE REAL ESTATE MORTGAGE CONTRACT WAS SHAM, FICTITIOUS AS IT WAS A
PRODUCT OF FORGERY BECAUSE PETITIONER'S PURPORTED SIGNATURE APPEARING THEREIN WAS SIGNED AND FALSIFIED BY A CERTAIN ANGELA
CELOSIA.

C. WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT AWARDED ATTORNEY'S FEES WHICH WAS DELETED BY RTC-BRANCH 16 OF DAVAO CITY
DESPITE THE ABSENCE OF ANY EXPLANATION AND/OR JUSTIFICATION IN THE BODY OF THE DECISION.5

At the outset, it bears to reiterate the settled rule that the only question that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the premises,
that is, to the possession de facto and not to the possession de jure.6 It does not even matter if a party's title to the property is questionable.7 In an unlawful detainer case, the sole
issue for resolution is the physical or material possession of the property involved, independent of any claim of ownership by any of the party litigants.8 Where the issue of ownership is
raised by any of the parties, the courts may pass upon the same in order to determine who has the right to possess the property.9The adjudication is, however, merely provisional and
would not bar or prejudice an action between the same parties involving title to the property.10

In the instant case, pending final resolution of the suit filed by petitioner for the declaration of nullity of the real estate mortgage in favor of Yap, the MTCC, the RTC and the CA were
unanimous in sustaining the presumption of validity of the real estate mortgage over the subject property in favor of Yap as well as the presumption of regularity in the performance of
the duties of the public officers who subsequently conducted its foreclosure sale and issued a provisional certificate of sale. Based on the presumed validity of the mortgage and the

subsequent foreclosure sale, the MTCC, the RTC and the CA also sustained the validity of respondent's purchase of the disputed property from Yap. The Court finds no cogent reason
to depart from these rulings of the MTCC, RTC and CA. Thus, for purposes of resolving the issue as to who between petitioner and respondent is entitled to possess the subject
property, this presumption stands.

Going to the main issue in the instant petition, it is settled that in unlawful detainer, one unlawfully withholds possession thereof after the expiration or termination of his right to hold
possession under any contract, express or implied.11 In such case, the possession was originally lawful but became unlawful by the expiration or termination of the right to possess;
hence, the issue of rightful possession is decisive for, in such action, the defendant is in actual possession and the plaintiffs cause of action is the termination of the defendants right to
continue in possession.12

In the instant petition, petitioner's basic postulate in her first and second assigned errors is that she remains the owner of the subject property. Based on her contract of lease with
respondent, petitioner insists that respondent is not permitted to deny her title over the said property in accordance with the provisions of Section 2 (b), Rule 131 of the Rules of Court.

The Court does not agree.

The conclusive presumption found in Section 2 (b), Rule 131 of the Rules of Court, known as estoppel against tenants, provides as follows:

Sec. 2. Conclusive presumptions. The following are instances of conclusive presumptions:

xxxx

(b) The tenant is not permitted to deny the title of his landlord at the time of the commencement of the relation of landlord and tenant between them. (Emphasis supplied).

It is clear from the abovequoted provision that what a tenant is estopped from denying is the title of his landlord at the time of the commencement of the landlord-tenant relation.13 If the
title asserted is one that is alleged to have been acquired subsequent to the commencement of that relation, the presumption will not apply.14 Hence, the tenant may show that the
landlord's title has expired or been conveyed to another or himself; and he is not estopped to deny a claim for rent, if he has been ousted or evicted by title paramount.15 In the present
case, what respondent is claiming is her supposed title to the subject property which she acquired subsequent to the commencement of the landlord-tenant relation between her and
petitioner. Hence, the presumption under Section 2 (b), Rule 131 of the Rules of Court does not apply.

The foregoing notwithstanding, even if respondent is not estopped from denying petitioner's claim for rent, her basis for such denial, which is her subsequent acquisition of ownership of
the disputed property, is nonetheless, an insufficient excuse from refusing to pay the rentals due to petitioner.

There is no dispute that at the time that respondent purchased Yap's rights over the subject property, petitioner's right of redemption as a mortgagor has not yet expired. It is settled that
during the period of redemption, it cannot be said that the mortgagor is no longer the owner of the foreclosed property, since the rule up to now is that the right of a purchaser at a
foreclosure sale is merely inchoate until after the period of redemption has expired without the right being exercised.16 The title to land sold under mortgage foreclosure remains in the
mortgagor or his grantee until the expiration of the redemption period and conveyance by the master's deed.17 Indeed, the rule has always been that it is only upon the expiration of the
redemption period, without the judgment debtor having made use of his right of redemption, that the ownership of the land sold becomes consolidated in the purchaser.18

Stated differently, under Act. No. 3135, the purchaser in a foreclosure sale has, during the redemption period, only an inchoate right and not the absolute right to the property with all the
accompanying incidents.19 He only becomes an absolute owner of the property if it is not redeemed during the redemption period.20

Pending expiration of the period of redemption, Section 7 of Act No. 3135,21 as amended, provides:

Sec. 7. In any sale made under the provisions of this Act, the purchaser may petition the Court of First Instance of the province or place where the property or any part thereof is
situated, to give him possession thereof during the redemption period, furnishing bond in an amount equivalent to the use of the property for a period of twelve months, to indemnify the
debtor in case it be shown that the sale was made without violating the mortgage or without complying with the requirements of this Act. Such petition shall be made under oath and
filed in [the] form of an ex parte motion in the registration or cadastral proceedings if the property is registered, or in special proceedings in the case of property registered under the
Mortgage Law or under section one hundred and ninety-four of the Administrative Code, or of any other real property encumbered with a mortgage duly registered in the office of any
register of deeds in accordance with any existing law, and in each case the clerk of the court shall, upon the filing of such petition, collect the fees specified in paragraph eleven of

section one hundred and fourteen of Act Numbered Four hundred and ninety-six, as amended by Act Numbered Twenty-eight hundred and sixty-six, and the court shall, upon approval
of the bond, order that a writ of possession issue, addressed to the sheriff of the province in which the property is situated, who shall execute said order immediately.

Thus, it is clear from the abovequoted provision of law that, as a consequence of the inchoate character of the purchaser's right during the redemption period, Act. No. 3135, as
amended, allows the purchaser at the foreclosure sale to take possession of the property only upon the filing of a bond, in an amount equivalent to the use of the property for a period of
twelve (12) months, to indemnify the mortgagor in case it be shown that the sale was made in violation of the mortgage or without complying with the requirements of the law. In Cua Lai
Chu v. Laqui,22 this Court reiterated the rule earlier pronounced in Navarra v. Court of Appeals23 that the purchaser at an extrajudicial foreclosure sale has a right to the possession of
the property even during the one-year redemption period provided the purchaser files an indemnity bond. That bond, nonetheless, is not required after the purchaser has consolidated
his title to the property following the mortgagor's failure to exercise his right of redemption for in such a case, the former has become the absolute owner thereof.24

It, thus, clearly follows from the foregoing that, during the period of redemption, the mortgagor, being still the owner of the foreclosed property, remains entitled to the physical
possession thereof subject to the purchaser's right to petition the court to give him possession and to file a bond pursuant to the provisions of Section 7 of Act No. 3135, as amended.
The mere purchase and certificate of sale alone do not confer any right to the possession or beneficial use of the premises.25

In the instant case, there is neither evidence nor allegation that respondent, as purchaser of the disputed property, filed a petition and bond in accordance with the provisions of Section
7 of Act No. 3135. In addition, respondent defaulted in the payment of her rents. Thus, absent respondent's filing of such petition and bond prior to the expiration of the period of
redemption, coupled with her failure to pay her rent, she did not have the right to possess the subject property.

On the other hand, petitioner, as mortgagor and owner, was entitled not only to the possession of the disputed house and lot but also to the rents, earnings and income derived
therefrom. In this regard, the RTC correctly cited Section 32, Rule 39 of the Rules of Court which provides as follows:

Sec. 32. Rents, earnings and income of property pending redemption. The purchaser or a redemptioner shall not be entitled to receive the rents, earnings and income of the property
sold on execution, or the value of the use and occupation thereof when such property is in the possession of a tenant. All rents, earnings and income derived from the property pending
redemption shall belong to the judgment obligor until the expiration of his period of redemption. (Emphasis supplied)

While the above rule refers to execution sales, the Court finds no cogent reason not to apply the same principle to a foreclosure sale, as in this case.

The situation became different, however, after the expiration of the redemption period on February 23, 2001. Since there is no allegation, much less evidence, that petitioner redeemed
the subject property within one year from the date of registration of the certificate of sale, respondent became the owner thereof. Consolidation of title becomes a right upon the
expiration of the redemption period.26 Having become the owner of the disputed property, respondent is then entitled to its possession.

As a consequence, petitioner's ejectment suit filed against respondent was rendered moot when the period of redemption expired on February 23, 2001 without petitioner having
redeemed the subject property, for upon expiration of such period petitioner lost his possessory right over the same. Hence, the only remaining right that petitioner can enforce is his
right to the rentals during the time that he was still entitled to physical possession of the subject property that is from May 2000 until February 23, 2001.1wphi1

In this regard, this Court agrees with the findings of the MTCC that, based on the evidence and the pleadings filed by petitioner, respondent is liable for payment of rentals beginning
May 2000 until February 2001, or for a period of ten (10) months. However, it is not disputed that respondent already gave to petitioner the sum of P27,000.00, which is equivalent to
two (2) months rental, as deposit to cover for any unpaid rentals. It is only proper to deduct this amount from the rentals due to petitioner, thus leaving P108,000.00 unpaid rentals.

As to attorneys fees and litigation expenses, the Court agrees with the RTC that since petitioner is, in entitled to unpaid rentals, her complaint which, among others, prays for the
payment of unpaid rentals, is justified. Thus, the award of attorney' and litigation expenses to respondent should be deleted.

WHEREFORE, the Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 77617, dated September 8, 2004 and August 16, 2006, respectively, are AFFIRMED with the
following MODIFICATIONS: (1) respondent is ORDERED to pay petitioner P108,000.00 as and for unpaid rentals; (2) the award of attorneys fees and litigation expenses to respondent
is DELETED.

SO ORDERED.

35. G.R. No. 196577

February 25, 2013

LAND BANK OF THE PHILIPPINES, Petitioner,

vs.
BARBARA SAMPAGA POBLETE, Respondent.

DECISION

CARPIO, J.:

The Case

This Petition for Review on Certiorari1 seeks to reverse the Court of Appeals' Decision2 dated 28 September 20 I 0 and its Resolution3 dated 19 April 2011 in C A-G.R. CV No. 91666.
The Court of Appeals (C A) affirmed in toto the Decision4 of the Regional Trial Court (RTC) of San Jose, Occidental Mindoro, Branch 46, in Civil Case No. R-1331.

The Facts

The facts, as culled from the records, are as follows:

Petitioner Land Bank of the Philippines (Land Bank) is a banking institution organized and existing under Philippine laws. Respondent Barbara Sampaga Poblete (Poblete) is the
registered owner of a parcel of land, known as Lot No. 29, with an area of 455 square meters, located in Buenavista, Sablayan, Occidental Mindoro, under Original Certificate of Title
(OCT) No. P-12026. In October 1997, Poblete obtained a P300,000.00 loan from Kabalikat ng Pamayanan ng Nagnanais Tumulong at Yumaman Multi-Purpose Cooperative
(Kapantay). Poblete mortgaged Lot No. 29 to Kapantay to guarantee payment of the loan. Kapantay, in turn, used OCT No. P-12026 as collateral under its Loan Account No. 97-CC013 with Land Bank-Sablayan Branch.

In November 1998, Poblete decided to sell Lot No. 29 to pay her loan. She instructed her son-in-law Domingo Balen (Balen) to look for a buyer. Balen referred Angelito Joseph Maniego
(Maniego) to Poblete. According to Poblete, Maniego agreed to buy Lot No. 29 for P900,000.00, but Maniego suggested that a deed of absolute sale forP300,000.00 be executed
instead to reduce the taxes. Thus, Poblete executed the Deed of Absolute Sale dated 9 November 1998 (Deed dated 9 November 1998) with P300,000.00 as consideration.5 In the
Deed dated 9 November 1998, Poblete described herself as a "widow." Poblete, then, asked Balen to deliver the Deed dated 9 November 1998 to Maniego and to receive the payment
in her behalf. Balen testified that he delivered the Deed dated 9 November 1998 to Maniego. However, Balen stated that he did not receive from Maniego the agreed purchase price.
Maniego told Balen that he would pay the amount upon his return from the United States. In an Affidavit dated 19 November 1998, Poblete stated that she agreed to have the payment
deposited in her Land Bank Savings Account.6

Based on a Certification issued by Land Bank-Sablayan Branch Department Manager Marcelino Pulayan on 20 August 1999,7 Maniego paid Kapantays Loan Account No. 97-CC-013
for P448,202.08. On 8 June 2000, Maniego applied for a loan of P1,000,000.00 with Land Bank, using OCT No. P 12026 as collateral. Land Bank alleged that as a condition for the
approval of the loan, the title of the collateral should first be transferred to Maniego.

On 14 August 2000, pursuant to a Deed of Absolute Sale dated 11 August 2000 (Deed dated 11 August 2000),8 the Register of Deeds of Occidental Mindoro issued Transfer Certificate
of Title (TCT) No. T-20151 in Maniegos name. On 15 August 2000, Maniego and Land Bank executed a Credit Line Agreement and a Real Estate Mortgage over TCT No. T- 20151.
On the same day, Land Bank released the P1,000,000.00 loan proceeds to Maniego. Subsequently, Maniego failed to pay the loan with Land Bank. On 4 November 2002, Land Bank
filed an Application for Extra-judicial Foreclosure of Real Estate Mortgage stating that Maniegos total indebtedness amounted toP1,154,388.88.

On 2 December 2002, Poblete filed a Complaint for Nullification of the Deed dated 11 August 2000 and TCT No. T-20151, Reconveyance of Title and Damages with Prayer for
Temporary Restraining Order and/or Issuance of Writ of Preliminary Injunction. Named defendants were Maniego, Land Bank, the Register of Deeds of Occidental Mindoro and Elsa Z.
Aguirre in her capacity as Acting Clerk of Court of RTC San Jose, Occidental Mindoro. In her Complaint, Poblete alleged that despite her demands on Maniego, she did not receive the
consideration of P900,000.00 for Lot No. 29. She claimed that without her knowledge, Maniego used the Deed dated 9 November 1998 to acquire OCT No. P-12026 from Kapantay.
Upon her verification with the Register of Deeds, the Deed dated 11 August 2000 was used to obtain TCT No. T-20151. Poblete claimed that the Deed dated 11 August 2000 bearing
her and her deceased husbands, Primo Poblete, supposed signatures was a forgery as their signatures were forged. As proof of the forgery, Poblete presented the Death Certificate
dated 27 April 1996 of her husband and Report No. 294-502 of the Technical Services Department of the National Bureau of Investigation showing that the signatures in the Deed dated

11 August 2000 were forgeries. Accordingly, Poblete also filed a case for estafa through falsification of public document against Maniego and sought injunction of the impending
foreclosure proceeding.

On 7 January 2003, Land Bank filed its Answer with Compulsory Counterclaim and Cross-claim. Land Bank claimed that it is a mortgagee in good faith and it observed due diligence
prior to approving the loan by verifying Maniegos title with the Office of the Register of Deeds. Land Bank likewise interposed a cross-claim against Maniego for the payment of the
loan, with interest, penalties and other charges. Maniego, on the other hand, separately filed his Answer. Maniego denied the allegations of Poblete and claimed that it was Poblete who
forged the Deed dated 11 August 2000. He also alleged that he paid the consideration of the sale to Poblete and even her loans from Kapantay and Land Bank.

The Ruling of the Regional Trial Court

On 28 December 2007, the RTC of San Jose, Occidental Mindoro, Branch 46, rendered a Decision in favor of Poblete, the dispositive portion of which reads:

WHEREFORE, by preponderance of evidence, judgment is hereby rendered in favor of the plaintiff and against the defendants, as follows:

1. Declaring the Deed of Sale dated August 11, 2000 over O.C.T. No. P-12026, as null and void;

2. Declaring Transfer of Certificate of Title No. T-20151 as null and void, it having been issued on the basis of a spurious and forged document;

3. The preliminary [i]njunction issued directing the defendants to refrain from proceedings [sic] with the auction sale of the plaintiffs properties, dated February 10, 2002,
is hereby made permanent;

4. Ordering defendant Angelito Joseph Maniego to return to the plaintiff O.C.T. No. P-12026; and

5. Ordering defendant Angelito Joseph Maniego to pay plaintiff the amount of P50,000.00, as and for reasonable attorneys fees.

Judgment is furthermore rendered on the cross-claim of defendant Land Bank of the Philippines against defendant Angelito Joseph Maniego, as follows:

A. Ordering defendant Angelito Joseph Maniego to pay his co-defendant [L]and Bank of the Philippines his loan with a principal of P1,000,000.00, plus interests, penalties
and other charges thereon; and

B. Ordering defendant Angelito Joseph Maniego to pay the costs of this suit.

SO ORDERED.9

The RTC ruled that the sale between Poblete and Maniego was a nullity. The RTC found that the agreed consideration was P900,000.00 and Maniego failed to pay the consideration.
Furthermore, the signatures of Poblete and her deceased husband were proven to be forgeries. The RTC also ruled that Land Bank was not a mortgagee in good faith because it failed
to exercise the diligence required of banking institutions. The RTC explained that had Land Bank exercised due diligence, it would have known before approving the loan that the sale
between Poblete and Maniego had not been consummated. Nevertheless, the RTC granted Land Banks cross-claim against Maniego.

In an Order dated 17 March 2008, the RTC denied the Motion for Reconsideration filed by Land Bank for want of merit. Thereafter, Land Bank and Maniego separately challenged the
RTCs Decision before the CA.

The Ruling of the Court of Appeals

On 28 September 2010, the CA promulgated its Decision affirming in toto the Decision of the RTC.10 Both Land Bank and Maniego filed their Motions for Reconsideration but the CA
denied both motions on 19 April 2011.11

In a Resolution dated 13 July 2011,12 the Second Division of this Court denied the Petition for Review on Certiorari filed by Maniego. This Resolution became final and executory on 19
January 2012.

On the other hand, Land Bank filed this petition.

The Issues

Land Bank seeks a reversal and raises the following issues for resolution:

1. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) ERRED IN UPHOLDING THE FINDING OF THE TRIAL COURT DECLARING TCT NO. T20151 AS NULL AND VOID. THE COURT OF APPEALS MISCONSTRUED AND MISAPPRECIATED THE EVIDENCE AND THE LAW IN NOT FINDING TCT NO. T20151 REGISTERED IN THE NAME OF ANGELITO JOSEPH MANIEGO AS VALID.

2. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) MISCONSTRUED THE EVIDENCE AND THE LAW IN NOT FINDING LAND BANK A
MORTGAGEE IN GOOD FAITH.

3. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) MISCONSTRUED THE EVIDENCE AND THE LAW IN NOT FINDING THE RESPONDENT
AND ANGELITO JOSEPH MANIEGO ASIN PARI DELICTO.

4. THE COURT OF APPEALS (FORMER SPECIAL ELEVENTH DIVISION) ERRED IN NOT APPLYING THE PRINCIPLE OF ESTOPPEL OR LACHES ON
RESPONDENT IN THAT THE PROXIMATE CAUSE OF HER LOSS WAS HER NEGLIGENCE TO SAFEGUARD HER RIGHTS OVER THE SUBJECT PROPERTY,
THEREBY ENABLING ANGELITO JOSEPH MANIEGO TO MORTGAGE THE SAME WITH LAND BANK.13

The Ruling of the Court

We do not find merit in the petition.

A petition for review under Rule 45 of the Rules of Court specifically provides that only questions of law may be raised, subject to exceptional circumstances14 which are not present in
this case. Hence, factual findings of the trial court, especially if affirmed by the CA, are binding on us.15 In this case, both the RTC and the CA found that the signatures of Poblete and
her deceased husband in the Deed dated 11 August 2000 were forged by Maniego. In addition, the evidence is preponderant that Maniego did not pay the consideration for the sale.
Since the issue on the genuineness of the Deed dated 11 August 2000 is essentially a question of fact, we are not dutybound to analyze and weigh the evidence again.16

It is a well-entrenched rule, as aptly applied by the CA, that a forged or fraudulent deed is a nullity and conveys no title.17 Moreover, where the deed of sale states that the purchase
price has been paid but in fact has never been paid, the deed of sale is void ab initio for lack of consideration.18 Since the Deed dated 11 August 2000 is void, the corresponding TCT
No. T-20151 issued pursuant to the same deed is likewise void. In Yu Bun Guan v. Ong,19 the Court ruled that there was no legal basis for the issuance of the certificate of title and the
CA correctly cancelled the same when the deed of absolute sale was completely simulated, void and without effect. In Erea v. Querrer-Kauffman,20 the Court held that when the
instrument presented for registration is forged, even if accompanied by the owners duplicate certificate of title, the registered owner does not thereby lose his title, and neither does the
mortgagee acquire any right or title to the property. In such a case, the mortgagee under the forged instrument is not a mortgagee protected by law.21

The issue on the nullity of Maniegos title had already been foreclosed when this Court denied Maniegos petition for review in the Resolution dated 13 July 2011, which became final
and executory on 19 January 2012.22 It is settled that a decision that has acquired finality becomes immutable and unalterable and may no longer be modified in any respect, even if
the modification is meant to correct erroneous conclusions of fact or law and whether it will be made by the court that rendered it or by the highest court of the land.23 This is without
prejudice, however, to the right of Maniego to recover from Poblete what he paid to Kapantay for the account of Poblete, otherwise there will be unjust enrichment by Poblete.

Since TCT No. T-20151 has been declared void by final judgment, the Real Estate Mortgage constituted over it is also void. In a real estate mortgage contract, it is essential that the
mortgagor be the absolute owner of the property to be mortgaged; otherwise, the mortgage is void.24

Land Bank insists that it is a mortgagee in good faith since it verified Maniegos title, did a credit investigation, and inspected Lot No. 29. The issue of being a mortgagee in good faith is
a factual matter, which cannot be raised in this petition.25 However, to settle the issue, we carefully examined the records to determine whether or not Land Bank is a mortgagee in
good faith.1wphi1

There is indeed a situation where, despite the fact that the mortgagor is not the owner of the mortgaged property, his title being fraudulent, the mortgage contract and any foreclosure
sale arising therefrom are given effect by reason of public policy.26 This is the doctrine of "the mortgagee in good faith" based on the rule that buyers or mortgagees dealing with
property covered by a Torrens Certificate of Title are not required to go beyond what appears on the face of the title.27 However, it has been consistently held that this rule does not
apply to banks, which are required to observe a higher standard of diligence.28 A bank whose business is impressed with public interest is expected to exercise more care and
prudence in its dealings than a private individual, even in cases involving registered lands.29 A bank cannot assume that, simply because the title offered as security is on its face free
of any encumbrances or lien, it is relieved of the responsibility of taking further steps to verify the title and inspect the properties to be mortgaged.30

Applying the same principles, we do not find Land Bank to be a mortgagee in good faith.

Good faith, or the lack of it, is a question of intention.31 In ascertaining intention, courts are necessarily controlled by the evidence as to the conduct and outward acts by which alone
the inward motive may, with safety, be determined.32

Based on the evidence, Land Bank processed Maniegos loan application upon his presentation of OCT No. P-12026, which was still under the name of Poblete. Land Bank even
ignored the fact that Kapantay previously used Pobletes title as collateral in its loan account with Land Bank.33 In Bank of Commerce v. San Pablo, Jr.,34 we held that when "the
person applying for the loan is other than the registered owner of the real property being mortgaged, [such fact] should have already raised a red flag and which should have induced
the Bank x x x to make inquiries into and confirm x x x [the] authority to mortgage x x x. A person who deliberately ignores a significant fact that could create suspicion in an otherwise
reasonable person is not an innocent purchaser for value."

The records do not even show that Land Bank investigated and inspected the property to ascertain its actual occupants. Land Bank merely mentioned that it inspected Lot No. 29 to
appraise the value of the property. We take judicial notice of the standard practice of banks, before approving a loan, to send representatives to the premises of the land offered as
collateral to investigate its real owners.35 In Prudential Bank v. Kim Hyeun Soon,36 the Court held that the bank failed to exercise due diligence although its representative conducted
an ocular inspection, because the representative concentrated only on the appraisal of the property and failed to inquire as to who were the then occupants of the property.

Land Bank claims that it conditioned the approval of the loan upon the transfer of title to Maniego, but admits processing the loan based on Maniegos assurances that title would soon
be his.37 Thus, only one day after Maniego obtained TCT No. T-20151 under his name, Land Bank and Maniego executed a Credit Line Agreement and a Real Estate Mortgage.
Because of Land Banks haste in granting the loan, it appears that Maniegos loan was already completely processed while the collateral was still in the name of Poblete. This is also
supported by the testimony of Land Bank Customer Assistant Andresito Osano.38

Where the mortgagee acted with haste in granting the mortgage loan and did not ascertain the ownership of the land being mortgaged, as well as the authority of the supposed agent
executing the mortgage, it cannot be considered an innocent mortgagee.39

Since Land Bank is not a mortgagee in good faith, it is not entitled to protection. The injunction against the foreclosure proceeding in the present case should be made permanent. Since
Lot No. 29 has not been transferred to a third person who is an innocent purchaser for value, ownership of the lot remains with Poblete. This is without prejudice to the right of either
party to proceed against Maniego.

On the allegation that Poblete is in pari delicto with Maniego, we find the principle inapplicable. The pari delicto rule provides that "when two parties are equally at fault, the law leaves
them as they are and denies recovery by either one of them."40 We adopt the factual finding of the RTC and the CA that only Maniego is at fault.

Finally, on the issues of estoppel and laches, such were not raised before the trial court.1wphi1 I fence, we cannot rule upon the same. It is settled that an issue which was neither
alleged in the complaint nor raised during the trial cannot be raised for the tirst time on appeal, as such a recourse would be offensive to the basic rules of t}1ir play, justice and due
process, since the opposing party would be deprived of the opp01iunity to introduce evidence rebutting such new issue.41

WHEREFORE, we DENY the petition. We AFFIRM the 28 September 2010 Decision and the 19 April 2011 Resolution of the Court of Appeals in CA-Ci.R. CV No. 91666. The injunction
against the foreclosure proceeding, issued by the Regional Trial Court of San Jose, Occidental Mindoro, Branch 46, is made permanent. Costs against Land Bank.

SO ORDERED.
36. G.R. No. 191667

April 17, 2013

LAND BANK OF THE PHILIPPINES, Petitioner,

vs.
EDUARDO M. CACAYURAN, Respondent.

DECISION

PERLAS-BERNABE, J.:

Assailed in this Petition for Review on Certiorari1 is the March 26, 2010 Decision2 of the Court of Appeals (CA) in CA-G.R. CV. No. 89732 which affirmed with modification the April 10,
2007 Decision3 of the Regional Trial Court (RTC) of Agoo, La Union, Branch 31, declaring inter alia the nullity of the loan agreements entered into by petitioner Land Bank of the
Philippines (Land Bank) and the Municipality of Agoo, La Union (Municipality).

The Facts

From 2005 to 2006, the Municipalitys Sangguniang Bayan (SB) passed certain resolutions to implement a multi-phased plan (Redevelopment Plan) to redevelop the Agoo Public Plaza
(Agoo Plaza) where the Imelda Garden and Jose Rizal Monument were situated.

To finance phase 1 of the said plan, the SB initially passed Resolution No. 68-20054 on April 19, 2005, authorizing then Mayor Eufranio Eriguel (Mayor Eriguel) to obtain a loan from
Land Bank and incidental thereto, mortgage a 2,323.75 square meter lot situated at the southeastern portion of the Agoo Plaza (Plaza Lot) as collateral. To serve as additional security,
it further authorized the assignment of a portion of its internal revenue allotment (IRA) and the monthly income from the proposed project in favor of Land Bank.5 The foregoing terms
were confirmed, approved and ratified on October 4, 2005 through Resolution No. 139-2005.6 Consequently, on November 21, 2005, Land Bank extended a P4,000,000.00 loan in
favor of the Municipality (First Loan),7 the proceeds of which were used to construct ten (10) kiosks at the northern and southern portions of the Imelda Garden. After completion, these
kiosks were rented out.8

On March 7, 2006, the SB passed Resolution No. 58-2006,9 approving the construction of a commercial center on the Plaza Lot as part of phase II of the Redevelopment Plan. To
finance the project, Mayor Eriguel was again authorized to obtain a loan from Land Bank, posting as well the same securities as that of the First Loan. All previous representations and
warranties of Mayor Eriguel related to the negotiation and obtention of the new loan10were ratified on September 5, 2006 through Resolution No. 128-2006.11 In consequence, Land
Bank granted a second loan in favor of the Municipality on October 20, 2006 in the principal amount of P28,000,000.00 (Second Loan).12

Unlike phase 1 of the Redevelopment Plan, the construction of the commercial center at the Agoo Plaza was vehemently objected to by some residents of the Municipality. Led by
respondent Eduardo Cacayuran (Cacayuran), these residents claimed that the conversion of the Agoo Plaza into a commercial center, as funded by the proceeds from the First and
Second Loans (Subject Loans), were "highly irregular, violative of the law, and detrimental to public interests, and will result to wanton desecration of the said historical and public
park."13 The foregoing was embodied in a Manifesto,14 launched through a signature campaign conducted by the residents and Cacayuran.

In addition, Cacayuran wrote a letter15 dated December 8, 2006 addressed to Mayor Eriguel, Vice Mayor Antonio Eslao (Vice Mayor Eslao), and the members of the SB namely,
Violeta Laroya-Balbin, Jaime Boado, Jr., Rogelio De Vera, James Dy, Crisogono Colubong, Ricardo Fronda, Josephus Komiya, Erwina Eriguel, Felizardo Villanueva, and Gerard
Mamuyac (Implicated Officers), expressing the growing public clamor against the conversion of the Agoo Plaza into a commercial center. He then requested the foregoing officers to
furnish him certified copies of various documents related to the aforementioned conversion including, among others, the resolutions approving the Redevelopment Plan as well as the
loan agreements for the sake of public information and transparency.

Unable to get any response, Cacayuran, invoking his right as a taxpayer, filed a Complaint16 against the Implicated Officers and Land Bank, assailing, among others, the validity of the
Subject Loans on the ground that the Plaza Lot used as collateral thereof is property of public dominion and therefore, beyond the commerce of man.17

Upon denial of the Motion to Dismiss dated December 27, 2006,18 the Implicated Officers and Land Bank filed their respective Answers.

For its part, Land Bank claimed that it is not privy to the Implicated Officers acts of destroying the Agoo Plaza. It further asserted that Cacayuran did not have a cause of action against
it since he was not privy to any of the Subject Loans.19

During the pendency of the proceedings, the construction of the commercial center was completed and the said structure later became known as the Agoos People Center (APC).

On May 8, 2007, the SB passed Municipal Ordinance No. 02-2007,20 declaring the area where the APC stood as patrimonial property of the Municipality.

The Ruling of the RTC

In its Decision dated April 10, 2007,21 the RTC ruled in favor of Cacayuran, declaring the nullity of the Subject Loans.22 It found that the resolutions approving the said loans were
passed in a highly irregular manner and thus, ultra vires; as such, the Municipality is not bound by the same.23 Moreover, it found that the Plaza Lot is proscribed from collateralization
given its nature as property for public use.24

Aggrieved, Land Bank filed its Notice of Appeal on April 23, 2007.25 On the other hand, the Implicated Officers appeal was deemed abandoned and dismissed for their failure to file an
appellants brief despite due notice.26 In this regard, only Land Banks appeal was given due course by the CA.

Ruling of the CA

In its Decision dated March 26, 2010,27 the CA affirmed with modification the RTCs ruling, excluding Vice Mayor Eslao from any personal liability arising from the Subject Loans.28

It held, among others, that: (1) Cacayuran had locus standi to file his complaint, considering that (a) he was born, raised and a bona fide resident of the Municipality; and (b) the issue at
hand involved public interest of transcendental importance;29 (2) Resolution Nos. 68-2005, 139-2005, 58-2006, 128-2006 and all other related resolutions (Subject Resolutions) were
invalidly passed due to the SBs non-compliance with certain sections of Republic Act No. 7160, otherwise known as the "Local Government Code of 1991" (LGC); (3) the Plaza Lot,
which served as collateral for the Subject Loans, is property of public dominion and thus, cannot be appropriated either by the State or by private persons;30 and (4) the Subject Loans
are ultra vires because they were transacted without proper authority and their collateralization constituted improper disbursement of public funds.

Dissatisfied, Land Bank filed the instant petition.

Issues Before the Court

The following issues have been raised for the Courts resolution: (1) whether Cacayuran has standing to sue; (2) whether the Subject Resolutions were validly passed; and (3) whether
the Subject Loans are ultra vires.

The Courts Ruling

The petition lacks merit.

A. Cacayurans standing to sue

Land Bank claims that Cacayuran did not have any standing to contest the construction of the APC as it was funded through the proceeds coming from the Subject Loans and not from
public funds. Besides, Cacayuran was not even a party to any of the Subject Loans and is thus, precluded from questioning the same.

The argument is untenable.

It is hornbook principle that a taxpayer is allowed to sue where there is a claim that public funds are illegally disbursed, or that public money is being deflected to any improper purpose,
or that there is wastage of public funds through the enforcement of an invalid or unconstitutional law. A person suing as a taxpayer, however, must show that the act complained of
directly involves the illegal disbursement of public funds derived from taxation. In other words, for a taxpayers suit to prosper, two requisites must be met namely, (1) public funds
derived from taxation are disbursed by a political subdivision or instrumentality and in doing so, a law is violated or some irregularity is committed; and (2) the petitioner is directly
affected by the alleged act.31

Records reveal that the foregoing requisites are present in the instant case.

First, although the construction of the APC would be primarily sourced from the proceeds of the Subject Loans, which Land Bank insists are not taxpayers money, there is no denying
that public funds derived from taxation are bound to be expended as the Municipality assigned a portion of its IRA as a security for the foregoing loans. Needless to state, the

Municipalitys IRA, which serves as the local government units just share in the national taxes,32 is in the nature of public funds derived from taxation. The Court believes, however,
that although these funds may be posted as a security, its collateralization should only be deemed effective during the incumbency of the public officers who approved the same, else
those who succeed them be effectively deprived of its use.

In any event, it is observed that the proceeds from the Subject Loans had already been converted into public funds by the Municipalitys receipt thereof. Funds coming from private
sources become impressed with the characteristics of public funds when they are under official custody.33

Accordingly, the first requisite has been clearly met.

Second, as a resident-taxpayer of the Municipality, Cacayuran is directly affected by the conversion of the Agoo Plaza which was funded by the proceeds of the Subject Loans. It is
well-settled that public plazas are properties for public use34 and therefore, belongs to the public dominion.35 As such, it can be used by anybody and no one can exercise over it the
rights of a private owner.36 In this light, Cacayuran had a direct interest in ensuring that the Agoo Plaza would not be exploited for commercial purposes through the APCs
construction. Moreover, Cacayuran need not be privy to the Subject Loans in order to proffer his objections thereto. In Mamba v. Lara, it has been held that a taxpayer need not be a
party to the contract to challenge its validity; as long as taxes are involved, people have a right to question contracts entered into by the government.37

Therefore, as the above-stated requisites obtain in this case, Cacayuran has standing to file the instant suit.

B. Validity of the Subject Resolutions

Land Bank avers that the Subject Resolutions provided ample authority for Mayor Eriguel to contract the Subject Loans. It posits that Section 444(b)(1)(vi) of the LGC merely requires
that the municipal mayor be authorized by the SB concerned and that such authorization need not be embodied in an ordinance.38

A careful perusal of Section 444(b)(1)(vi) of the LGC shows that while the authorization of the municipal mayor need not be in the form of an ordinance, the obligation which the said
local executive is authorized to enter into must be made pursuant to a law or ordinance, viz:

Sec. 444. The Chief Executive: Powers, Duties, Functions and Compensation. -

xxxx

(b) For efficient, effective and economical governance the purpose of which is the general welfare of the municipality and its inhabitants pursuant to Section 16 of this Code, the
municipal mayor shall:

xxxx

(vi) Upon authorization by the sangguniang bayan, represent the municipality in all its business transactions and sign on its behalf all bonds, contracts, and obligations, and such other
documents made pursuant to law or ordinance; (Emphasis and underscoring supplied)

In the present case, while Mayor Eriguels authorization to contract the Subject Loans was not contained as it need not be contained in the form of an ordinance, the said loans and
even the Redevelopment Plan itself were not approved pursuant to any law or ordinance but through mere resolutions. The distinction between ordinances and resolutions is wellperceived. While ordinances are laws and possess a general and permanent character, resolutions are merely declarations of the sentiment or opinion of a lawmaking body on a
specific matter and are temporary in nature.39 As opposed to ordinances, "no rights can be conferred by and be inferred from a resolution."40 In this accord, it cannot be denied that the
SB violated Section 444(b)(1)(vi) of the LGC altogether.

Noticeably, the passage of the Subject Resolutions was also tainted with other irregularities, such as (1) the SBs failure to submit the Subject Resolutions to the Sangguniang
Panlalawigan of La Union for its review contrary to Section 56 of the LGC;41 and (2) the lack of publication and posting in contravention of Section 59 of the LGC.42

In fine, Land Bank cannot rely on the Subject Resolutions as basis to validate the Subject Loans.

C. Ultra vires nature of the Subject

Loans

Neither can Land Bank claim that the Subject Loans do not constitute ultra vires acts of the officers who approved the same.

Generally, an ultra vires act is one committed outside the object for which a corporation is created as defined by the law of its organization and therefore beyond the powers conferred
upon it by law.43 There are two (2) types of ultra vires acts. As held in Middletown Policemen's Benevolent Association v. Township of Middletown:44

There is a distinction between an act utterly beyond the jurisdiction of a municipal corporation and the irregular exercise of a basic power under the legislative grant in matters not in
themselves jurisdictional. The former are ultra vires in the primary sense and void; the latter, ultra vires only in a secondary sense which does not preclude ratification or the application
of the doctrine of estoppel in the interest of equity and essential justice. (Emphasis and underscoring supplied)

In other words, an act which is outside of the municipalitys jurisdiction is considered as a void ultra vires act, while an act attended only by an irregularity but remains within the
municipalitys power is considered as an ultra vires act subject to ratification and/or validation. To the former belongs municipal contracts which (a) are entered into beyond the express,
implied or inherent powers of the local government unit; and (b) do not comply with the substantive requirements of law e.g., when expenditure of public funds is to be made, there must
be an actual appropriation and certificate of availability of funds; while to the latter belongs those which (a) are entered into by the improper department, board, officer of agent; and
(b)do not comply with the formal requirements of a written contract e.g., the Statute of Frauds.45

Applying these principles to the case at bar, it is clear that the Subject Loans belong to the first class of ultra vires acts deemed as void.

Records disclose that the said loans were executed by the Municipality for the purpose of funding the conversion of the Agoo Plaza into a commercial center pursuant to the
Redevelopment Plan. However, the conversion of the said plaza is beyond the Municipalitys jurisdiction considering the propertys nature as one for public use and thereby, forming
part of the public dominion. Accordingly, it cannot be the object of appropriation either by the State or by private persons.46 Nor can it be the subject of lease or any other contractual
undertaking.47 In Villanueva v. Castaeda, Jr.,48 citing Espiritu v. Municipal Council of Pozorrubio,49 the Court pronounced that:

x x x Town plazas are properties of public dominion, to be devoted to public use and to be made available to the public in general. They are outside the commerce of man and cannot
be disposed of or even leased by the municipality to private parties.1wphi1

In this relation, Article 1409(1) of the Civil Code provides that a contract whose purpose is contrary to law, morals, good customs, public order or public policy is considered void50 and
as such, creates no rights or obligations or any juridical relations.51 Consequently, given the unlawful purpose behind the Subject Loans which is to fund the commercialization of the
Agoo Plaza pursuant to the Redevelopment Plan, they are considered as ultra vires in the primary sense thus, rendering them void and in effect, non-binding on the Municipality.

At this juncture, it is equally observed that the land on which the Agoo Plaza is situated cannot be converted into patrimonial property as the SB tried to when it passed Municipal
Ordinance No. 02-200752 absent any express grant by the national government.53 As public land used for public use, the foregoing lot rightfully belongs to and is subject to the
administration and control of the Republic of the Philippines.54 Hence, without the said grant, the Municipality has no right to claim it as patrimonial property.

Nevertheless, while the Subject Loans cannot bind the Municipality for being ultra vires, the officers who authorized the passage of the Subject Resolutions are personally liable. Case
law states that public officials can be held personally accountable for acts claimed to have been performed in connection with official duties where they have acted ultra vires,55 as in
this case.

WHEREFORE, the petition is DENIED. Accordingly, the March 26, 2010 Decision of the Court of Appeals in CA-G.R. CV. No. 89732 is hereby AFFIRMED.

SO ORDERED.

37. G.R. No. 194168

February 13, 2013

LAND BANK OF THE PHILIPPINES, Petitioner,

vs.
SPOUSES PLACIDO and CLARA DY ORILLA, Respondents.

DECISION

PERALTA, J.:

This is a petition for revievv on certiorari assailing the Decision1 dated April 17, 2009 of the Court of Appeals (CA) in CA-G.R. CV No. 70071, and the Resolution2 dated Septernber 30,
2010 denying petitioner's Motion for Partial Reconsideration.3

The factual and procedural antecedents are undisputed:

Respondents spouses Placido and Clara Orilla (respondents) were the owners of a parcel of land situated in Bohol, identified as Lot No. 1, 11-12706, containing an area of 23.3416
hectares and covered by Transfer Certificate of Title No. 18401. In the latter part of November 1996, the Department of Agrarian Reform Provincial Agrarian Reform Office (DARPARO)
of Bohol sent respondents a Notice of Land Valuation and Acquisition dated November 15, 1996 informing them of the compulsory acquisition of 21.1289 hectares of their landholdings
pursuant to the Comprehensive Agrarian Reform Law (Republic Act [RA] 6657) for P371,154.99 as compensation based on the valuation made by petitioner Land Bank of the
Philippines (LBP).4

However, respondents rejected the said valuation. Consequently, a summary hearing was conducted by the Provincial Department of Agrarian Reform Adjudication Board (Provincial
DARAB) to determine the amount of just compensation. After the proceedings, the Provincial DARAB affirmed the valuation made by the petitioner.5

Not content with the decision, respondents filed an action for the determination of just compensation before the Regional Trial Court of Tagbilaran City sitting as a Special Agrarian
Court (SAC). The case was docketed as Civil Case No. 6085 and was raffled to Branch 3.

After trial on the merits, the SAC rendered a Decision dated November 20, 2000, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered fixing the just compensation of the land of petitioner subject matter of the instant action at P7.00 per square meter, as only prayed for,
which shall earn legal interest from the filing of the complaint until the same shall have been fully paid. Furthermore, respondents are hereby ordered to jointly and solidarily indemnify
the petitioners their expenses for attorneys fee and contract fee in the conduct of the appraisal of the land by a duly licensed real estate appraiser Angelo G. Fajardo of which petitioner
shall submit a bill of costs therefor for the approval of the Court.

SO ORDERED.6

On December 11, 2000, petitioner filed a Notice of Appeal. Subsequently, on December 15, 2000, respondents filed a Motion for Execution Pending Appeal, pursuant to Section 2, Rule
39 of the 1997 Rules of Civil Procedure and the consolidated cases of Landbank of the Philippines v. Court of Appeals, et al.7 and Department of Agrarian Reform v. Court of Appeals,
et al.8 Respondents argued that the total amount of P1,479,023.00, which is equivalent to P7.00 per square meter for 21.1289 hectares, adjudged by the SAC as just compensation,
could then be withdrawn under the authority of the aforementioned case.9

On December 21, 2000, the SAC issued an Order granting the Motion for Execution Pending Appeal, the dispositive of which reads:

WHEREFORE, the herein motion is granted and the petitioners are hereby ordered to post bond equivalent to one-half of the amount due them by virtue of the decision in this case.
The respondent Land Bank of the Philippines, is therefore, ordered to immediately deposit with any accessible bank, as may be designated by respondent DAR, in cash or in any
governmental financial instrument the total amount due the petitionerspouses as may be computed within the parameters of Sec. 18(1) of RA 6657. Furthermore, pursuant to the
Supreme Court decisions in "Landbank of the Philippines vs. Court of Appeals, et al." G.R. No. 118712, promulgated on October 6, 1995 and "Department of Agrarian Reform vs. Court
of Appeals, et al.," G.R. No. 118745, promulgated on October 6, 1995, the petitioners may withdraw the same for their use and benefit consequent to their right of ownership thereof.10

On December 25, 2000, respondents filed a Motion for Partial Reconsideration of the amount of the bond to be posted, but it was later denied in an Order dated January 11, 2001.11

For its part, petitioner filed a Motion for Reconsideration, which was likewise denied in an Order dated December 29, 2000.12

On March 13, 2001, petitioner filed with the CA a special civil action for certiorari and prohibition under Rule 65 of the Rules of Court with prayer for issuance of a temporary restraining
order and/or preliminary injunction. It questioned the propriety of the SAC Order granting the execution pending appeal.13

In its Decision dated July 29, 2002, the CA dismissed the petition on the ground that the assailed SAC Order dated December 21, 2000 granting execution pending appeal was
consistent with justice, fairness, and equity, as respondents had been deprived of the use and possession of their property, pursuant to RA 6657 and are entitled to be immediately
compensated with the amount as determined by the SAC under the principle of "prompt payment" of just compensation. Petitioner filed a Motion for Reconsideration, but it was
denied.14

Petitioner then sought recourse before this Court in a petition docketed as G.R. No. 157206.1wphi1 After due proceedings, this Court rendered a Decision15 dated June 27, 2008,
affirming the decision of the CA. The decretal portion reads:

WHEREFORE, the Decision of the Court of Appeals, dated July 29, 2002, is AFFIRMED.16

Petitioner filed a Motion for Reconsideration, but was denied with finality by the Court.

Meanwhile, in CA-G.R. CV No. 70071, the CA rendered a Decision17 dated April 17, 2009, granting the appeal filed by the petitioner. The dispositive portion reads:

WHEREFORE, premises considered, the instant appeal is GRANTED. The assailed decision of the Regional Trial Court sitting as Special Agrarian Court is hereby SET ASIDE.

This case is REMANDED to the trial court for the proper determination of just compensation for the land taken.

SO ORDERED.18

The CA held that there was no valid and sufficient legal basis for the SAC in fixing the just compensation for the subject property at P1,479,023.00. Thus, the CA remanded the case to
the SAC for the proper determination of just compensation.

In disposing the case, the CA also took into consideration the Motion for Execution Pending Appeal that was granted earlier by the SAC and affirmed by the CA and this Court, to wit:

Finally, the petitioners-appellees filed a Manifestation for Early Resolution before this Court revealing that the petitioners-appellees filed before the SAC a motion for execution pending
appeal which was granted. This Court affirmed the decision of the SAC. Ultimately, the Supreme Court affirmed the decision of the Court of Appeals. Therefore, should the SAC find
upon recomputation that the just compensation previously rendered is bigger than the recomputed value, the petitioners-appellees are ordered to return the excess considering that
payment may already have been given by LBP in pursuant to the finality of the motion for execution pending appeal.19

Unsatisfied, petitioner filed a Motion for Partial Reconsideration.20 Petitioner argued that when the CA set aside the valuation of the SAC amounting to P1,479,023.00, it necessarily
follows that said amount can no longer be the subject of an execution pending appeal. Petitioner theorized that by annulling the SAC decision and, consequently, remanding the case to
the trial court, the latters decision was voided and, therefore, it could no longer be executed.

On September 30, 2010, the CA issued a Resolution21 denying the motion. The CA held that the issue of the validity of the writ of execution was already resolved by the Supreme
Court with finality in G.R. No. 157206. That was precisely the reason why it stated in the decision that "should the SAC find upon recomputation that the just compensation previously
rendered is bigger than the recomputed value, the petitioners-appellees are ordered to return the excess, considering that payment may already have been given by the LBP in
pursuant to the finality of the motion for execution pending appeal."22

Hence, the petition assigning the lone error:

THE HONORABLE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF LAW IN HOLDING THAT THE TRIAL COURTS DECISION, WHICH WAS ANNULLED AND SET
ASIDE, CAN STILL BE THE SUBJECT OF EXECUTION.23

Petitioner argues that when the CA set aside the valuation of the SAC, it necessarily means that such valuation can no longer be the subject of an execution pending appeal. It adds
that the writ of execution ordering the LBP to pay respondents the amount of P1,479,023.00 remains unimplemented as of the time the CA rendered the decision annulling the aforesaid
valuation.

Petitioner posits that once a decision is annulled or set aside, it is rendered without legal effect for being a void judgment. Petitioner maintains that while the issue of the validity of the
writ of execution issued by the SAC had been upheld by this Court in G.R. No. 157206, the enforcement of the writ had been rendered moot and academic after the decision of the SAC
was reversed and set aside by the CA.

On their part, respondents contend that having attained finality, the decision of this Court in G.R. No. 157206 could no longer be disturbed. Moreover, the reason advanced by the CA in
denying the motion for partial reconsideration was merely an affirmation of the decision of this Court in the said case.

The petition is without merit.

At the onset, it should be noted that although this Court, in Land Bank of the Philippines v. Orilla,24 held that the SAC validly issued the Order granting execution pending appeal in the
exercise of its sound discretion in issuing the same according to the Rules, still what this Court deemed was justified in that particular case was the propriety of the issuance of the said
Order and not the amount of monetary award that respondents were entitled which, in turn, corresponds to the valuation of the subject property as determined by the SAC in its
Decision. Thus, this Court stated in the said case that "while this decision does not finally resolve the propriety of the determination of just compensation by the SAC in view of the
separate appeal on the matter, we find no grave abuse of discretion on the part of the SAC Judge in allowing execution pending appeal."25

Anent the present controversy, in its Decision annulling the SAC valuation, the CA opined:

x x x In granting the award, the SAC merely granted the amount prayed for by the spouses and did not provide any computation or explanation on how it arrived at the amount. There
was therefore no valid and sufficient legal basis for the award.26

The CA, therefore, concluded that there was no sufficient legal basis for the valuation arrived at by the SAC in the amount of P1,479,023.00. In fine, the CA effectively set aside and
voided the Decision of the RTC fixing the amount of just compensation for the subject property. As correctly argued by petitioner, being the fruit of a void judgment such amount cannot
be the proper subject of the Order granting the motion for execution pending appeal issued by the SAC.

A void judgment or order has no legal and binding effect, force or efficacy for any purpose. In contemplation of law, it is non-existent. Such judgment or order may be resisted in any
action or proceeding whenever it is involved. It is not even necessary to take any steps to vacate or avoid a void judgment or final order; it may simply be ignored.27

In Metropolitan Waterworks & Sewerage System v. Sison,28 this Court held that:

x x x "A void judgment is not entitled to the respect accorded to a valid judgment, but may be entirely disregarded or declared inoperative by any tribunal in which effect is sought to be
given to it. It is attended by none of the consequences of a valid adjudication. It has no legal or binding effect or efficacy for any purpose or at any place. It cannot affect, impair or create
rights. It is not entitled to enforcement and is, ordinarily, no protection to those who seek to enforce. All proceedings founded on the void judgment are themselves regarded as invalid.
In other words, a void judgment is regarded as a nullity, and the situation is the same as it would be if there were no judgments. It, accordingly, leaves the parties litigants in the same
position they were in before the trial."29

Accordingly, a void judgment is no judgment at all. It cannot be the source of any right nor of any obligation. All acts performed pursuant to it and all claims emanating from it have no
legal effect. Hence, it can never become final, and any writ of execution based on it is void: "x x x it may be said to be a lawless thing which can be treated as an outlaw and slain at
sight, or ignored wherever and whenever it exhibits its head."30

As correctly maintained by petitioner, since the valuation made by the SAC in its Decision dated November 20, 2000 having been annulled by the CA for its lack of sufficient and legal
basis, the void judgment can never be validly executed.

Nevertheless, it must be pointed out that the situation contemplated by the CA in the assailed Decision was one wherein payment has already been made by petitioner to the
respondents during the pendency of the appeal. Nowhere in the disquisition of the CA can it be inferred that it is enjoining the LBP to enforce the writ of execution in accordance with
the valuation made by the SAC. On the contrary, the CA respected the finality of the motion for execution pending appeal should the same have already been enforced. As pronounced
by the CA:

x x x Therefore, should the SAC find upon computation that the just compensation previously rendered is bigger than the recomputed value, the petitioners-appellees are ordered to
return the excess considering that payment mayalready have been given by LBP in pursuant to the finality of the motion for execution pending appeal.31

Verily, it appears that the writ of execution pending appeal remains unimplemented as of the time the CA rendered its decision annulling the valuation made by the SAC. The monetary
award having emanated from a void valuation, it follows that the writ of execution pending appeal cannot be properly implemented. As contemplated by the CA, the situation would have
been different if the writ was already enforced during the pendency of the appeal, for at that time the writ could still be validly enforced since the valuation made by the SAC still stands.
Necessarily, as directed by the CA, any excess amount paid to respondents should be returned to petitioner.

Nonetheless, the amount of P371,154.99 representing the compensation offered by the petitioner for the land taken, can still be properly awarded to respondents in accordance
with Land Bank of the Philippines v. Court of Appeals.32In the said case, the Court allowed the release of the offered compensation to the landowner pending the determination of the
final valuation of their properties. The Court opined that:

We are not persuaded. As an exercise of police power, the expropriation of private property under the CARP puts the landowner, and not the government, in a situation where the odds
are already stacked against his favor. He has no recourse but to allow it. His only consolation is that he can negotiate for the amount of compensation to be paid for the expropriated
property. As expected, the landowner will exercise this right to the hilt, but subject however to the limitation that he can only be entitled to a "just compensation." Clearly therefore, by
rejecting and disputing the valuation of the DAR, the landowner is merely exercising his right to seek just compensation. If we are to affirm the withholding of the release of the offered
compensation despite depriving the landowner of the possession and use of his property, we are in effect penalizing the latter for simply exercising a right afforded to him by law.33

Of course, this is without prejudice to the outcome of the case which was remanded to the SAC for recomputation of just compensation. Should the SAC find the said valuation too low
and determine a higher valuation for the subject property, petitioner should pay respondents the difference. Conversely, should the SAC determine that the valuation was too high,
respondents should return the excess. To be sure, the concept of just compensation embraces not only the correct determination of the amount to be paid to the owners of the land, but
also payment within a reasonable time from its taking. Without prompt payment, compensation cannot be considered "just" inasmuch as the property owner is made to suffer the
consequences of being immediately deprived of his land while being made to wait for a decade or more before actually receiving the amount necessary to cope with his loss.34

WHEREFORE, subject to the foregoing disquisitions, the Decision and Resolution of the Court of Appeals, dated April 17, 2009 and September 30, 2010, respectively, in CA-G.R. CV
No. 70071, are AFFIRMED. Petitioner Land Bank of the Philippines is ORDERED to release the amount of P3 71,154.99 to respondents spouses Placido and Clara Orilla, without
prejudice to the recomputation of the just compensation for the subject land by the Regional Trial Court.

SO ORDERED.

38. G.R. No. 190106

January 15, 2014

MAGDALENA T. VILLASI, Petitioner,

vs.
FILOMENO GARCIA, substituted by his heirs, namely, ERMELINDA H. GARCIA, LIZA GARCIA-GONZALEZ, THERESA GARCIA-TIANGSON, MARIVIC H. GARCIA, MARLENE
GARCIA-MOMIN, GERARDO H. GARCIA, GIDEON H. GARCIA and GENEROSO H. GARCIA, and ERMELINDA H. GARCIA, Respondents.

DECISION

PEREZ, J.:

This is a Petition for Review on Certiorari1 filed pursuant to Rule 45 of the Revised Rules of Court, assailing the 19 May 2009 Decision2 rendered by the Sixth Division of the Court of
Appeals in CA-G.R. SP No. 92587. The appellate court affirmed the Order3 of the Regional Trial Court R TC) of Quezon City, Branch 77, directing the Deputy Sheriff to suspend the
conduct of the execution sale of the buildings levied upon by him.

The Facts

Sometime in 1990, petitioner Magdalena T Villasi (Villasi) engaged the services of respondent Fil-Garcia Construction, Inc. (FGCI) to construct a seven-storey condominium building
located at Aurora Boulevard corner N. Domingo Street, Cubao, Quezon City. For failure of Villasi to fully pay the contract price despite several demands, FGCI initiated a suit for
collection of sum of money before the RTC of Quezon City, Branch 77. In its action docketed as Civil Case No. Q-91-8187, FGCI prayed, among others, for the payment of the amount
of P2,865,000.00, representing the unpaid accomplishment billings. Served with summons, Villasi filed an answer specifically denying the material allegations of the complaint.
Contending that FGCI has no cause of action against her, Villasi averred that she delivered the total amount of P7,490,325.10 to FGCI but the latter accomplished only 28% of the
project. After the pre-trial conference was terminated without the parties having reached an amicable settlement, trial on the merits ensued.

Finding that FGCI was able to preponderantly establish by evidence its right to the unpaid accomplishment billings, the RTC rendered a Decision4 dated 26 June 1996 in FGCIs favor.
While the trial court brushed aside the allegation of Villasi that an excess payment was made, it upheld the claim of FGCI to the unpaid amount of the contract price and, thus, disposed:

WHEREFORE, judgment is hereby rendered:

1. Ordering [Villasi] to pay [FGCI] the sum of P2,865,000.00 as actual damages and unpaid accomplishment billings;

2. Ordering [Villasi] to pay [FGCI] the amount of P500,000.00 representing the value of unused building materials;

3. Ordering [Villasi] to pay [FGCI] the amount of P100,000.00, as moral damages and P100,000.00 as attorneys fees.5

Elevated on appeal and docketed as CA-GR CV No. 54750, the Court of Appeals reversed the disquisition of the RTC in its Decision6 dated 20 November 2000. The appellate court
ruled that an overpayment was made by Villasi and thereby directed FGCI to return the amount that was paid in excess, viz:

WHEREFORE, premises considered, the present appeal is hereby GRANTED and the appealed decision in Civil Case No. Q-91-8187 is hereby REVERSED and SET ASIDE and
judgment is hereby rendered ordering the [FGCI] to return to [Villasi] the sum of P1,244,543.33 as overpayment under their contract, and the further sum ofP425,004.00 representing
unpaid construction materials obtained by it from [Villasi]. [FGCI] is likewise hereby declared liable for the payment of liquidated damages in the sum equivalent to 1/10 of 1% of the
contract price for each day of delay computed from March 6, 1991.

No pronouncement as to costs.7

Unrelenting, FGCI filed a Petition for Review on Certiorari before this Court, docketed as G.R. No. 147960, asseverating that the appellate court erred in rendering the 20 November
2000 Decision. This Court, however, in a Resolution dated 1 October 2001, denied the appeal for being filed out of time. The said resolution became final and executory on 27
November 2001, as evidenced by the Entry of Judgment8 made herein.

To enforce her right as prevailing party, Villasi filed a Motion for Execution of the 20 November 2000 Court of Appeals Decision, which was favorably acted upon by the RTC.9 A Writ of
Execution was issued on 28 April 2004, commanding the Sheriff to execute and make effective the 20 November 2000 Decision of the Court of Appeals.

To satisfy the judgment, the sheriff levied on a building located at No. 140 Kalayaan Avenue, Quezon City, covered by Tax Declaration No. D-021-01458, and built in the lots registered
under Transfer Certificates of Title (TCT) Nos. 379193 and 379194. While the building was declared for taxation purposes in the name of FGCI, the lots in which it was erected were
registered in the names of the Spouses Filomeno Garcia and Ermelinda Halili-Garcia (Spouses Garcia). After the mandatory posting and publication of notice of sale on execution of
real property were complied with, a public auction was scheduled on 25 January 2006.

To forestall the sale on execution, the Spouses Garcia filed an Affidavit of Third Party Claim10 and a Motion to Set Aside Notice of Sale on Execution,11 claiming that they are the
lawful owners of the property which was erroneously levied upon by the sheriff. To persuade the court a quo to grant their motion, the Spouses Garcia argued that the building covered
by the levy was mistakenly assessed by the City Assessor in the name of FGCI. The motion was opposed by Villasi who insisted that its ownership belongs to FGCI and not to the
Spouses Garcia as shown by the tax declaration.

After weighing the arguments of the opposing parties, the RTC issued on 24 February 2005 an Order12 directing the Sheriff to hold in abeyance the conduct of the sale on execution, to
wit:

WHEREFORE, premises considered, the Court hereby orders Deputy Sheriff Angel Doroni to suspend or hold in abeyance the conduct of the sale on execution of the buildings levied
upon by him, until further orders from the Court.13

The motion for reconsideration of Villasi was denied by the trial court in its 11 October 2005 Order.14

Arguing that the RTC gravely abused its discretion in ordering the suspension of the sale on execution, Villasi timely filed a Petition for Certiorari before the Court of Appeals. In a
Decision15 dated 19 May 2009, the appellate court dismissed the petition. In a Resolution16 dated 28 October 2009, the Court of Appeals refused to reconsider its decision.

Villasi is now before this Court via this instant Petition for Review on Certiorariassailing the adverse Court of Appeals Decision and Resolution and raising the following issues:

The Issues

I.

WHETHER OR NOT THE HONORABLE COURT OF APPEALS GRIEVOUSLY ERRED IN UPHOLDING THE DECISION OF THE TRIAL COURT TO SUSPEND AND HOLD IN
ABEYANCE THE SALE ON EXECUTION OF THE BUILDINGS LEVIED UPON ON THE BASIS OF RESPONDENTS AFFIDAVIT OF THIRD-PARTY CLAIM;

II.

WHETHER OR NOT THE HONORABLE COURT OF APPEALS GRIEVOUSLY ERRED WHEN IT HELD THAT THERE IS NO REASON TO PIERCE THE VEIL OF [FGCIS]
CORPORATE FICTION IN THE CASE AT BAR; [AND]

III.

WHETHER OR NOT THE BRANCH SHERIFF OF THE REGIONAL TRIAL COURT OF QUEZON CITY, BRANCH 77 SHOULD BE DIRECTED TO FILE THE APPROPRIATE NOTICE
OF LEVY WITH THE REGISTER OF DEEDS OF QUEZON CITY.17

The Courts Ruling

It is a basic principle of law that money judgments are enforceable only against the property incontrovertibly belonging to the judgment debtor, and if the property belonging to any third
person is mistakenly levied upon to answer for another mans indebtedness, such person has all the right to challenge the levy through any of the remedies provided for under the Rules
of Court. Section 16,18 Rule 39 specifically provides that a third person may avail himself of the remedies of either terceria, to determine whether the sheriff has rightly or wrongly taken
hold of the property not belonging to the judgment debtor or obligor, or an independent "separate action" to vindicate his claim of ownership and/or possession over the foreclosed

property. However, the person other than the judgment debtor who claims ownership or right over levied properties is not precluded from taking other legal remedies to prosecute his
claim.19

Indeed, the power of the court in executing judgments extends only to properties unquestionably belonging to the judgment debtor alone. An execution can be issued only against a
party and not against one who did not have his day in court. The duty of the sheriff is to levy the property of the judgment debtor not that of a third person. For, as the saying goes, one
man's goods shall not be sold for another man's debts.20

Claiming that the sheriff mistakenly levied the building that lawfully belongs to them, the Spouses Garcia availed themselves of the remedy of terceria under Section 16, Rule 39 of the
Revised Rules of Court. To fortify their position, the Spouses Garcia asserted that as the owners of the land, they would be deemed under the law as owners of the building standing
thereon. The Spouses Garcia also asserted that the construction of the building was financed thru a loan obtained from Metrobank in their personal capacities, and they merely
contracted FGCI to construct the building. Finally, the Spouses Garcia argued that the tax declaration, based on an erroneous assessment by the City Assessor, cannot be made as
basis of ownership.

For her part, Villasi insists that the levy effected by the sheriff was proper since the subject property belongs to the judgment debtor and not to third persons. To dispute the ownership
of the Spouses Garcia, Villasi pointed out that the levied property was declared for tax purposes in the name of FGCI. A Certification issued by the Office of the City Engineering of
Quezon City likewise showed that the building permit of the subject property was likewise issued in the name of FGCI. We grant the petition.

The right of a third-party claimant to file a terceria is founded on his title or right of possession.1avvphi1 Corollary thereto, before the court can exercise its supervisory power to direct
the release of the property mistakenly levied and the restoration thereof to its rightful owner, the claimant must first unmistakably establish his ownership or right of possession thereon.
In Spouses Sy v. Hon. Discaya,21 we declared that for a third-party claim or a terceria to prosper, the claimant must first sufficiently establish his right on the property:

[A] third person whose property was seized by a sheriff to answer for the obligation of the judgment debtor may invoke the supervisory power of the court which authorized such
execution. Upon due application by the third person and after summary hearing, the court may command that the property be released from the mistaken levy and restored to the
rightful owner or possessor. What said court can do in these instances, however, is limited to a determination of whether the sheriff has acted rightly or wrongly in the performance of his
duties in the execution of judgment, more specifically, if he has indeed taken hold of property not belonging to the judgment debtor. The court does not and cannot pass upon the
question of title to the property, with any character of finality. It can treat of the matter only insofar as may be necessary to decide if the sheriff has acted correctly or not. It can require
the sheriff to restore the property to the claimant's possession if warranted by the evidence. However, if the claimant's proofs do not persuade the court of the validity of his title or right
of possession thereto, the claim will be denied.22 (Emphasis and underscoring supplied).

Our perusal of the record shows that, as the party asserting their title, the Spouses Garcia failed to prove that they have a bona fide title to the building in question. Aside from their
postulation that as title holders of the land, the law presumes them to be owners of the improvements built thereon, the Spouses Garcia were unable to adduce credible evidence to
prove their ownership of the property. In contrast, Villasi was able to satisfactorily establish the ownership of FGCI thru the pieces of evidence she appended to her opposition. Worthy
to note is the fact that the building in litigation was declared for taxation purposes in the name of FGCI and not in the Spouses Garcias. While it is true that tax receipts and tax
declarations are not incontrovertible evidence of ownership, they constitute credible proof of claim of title over the property.23 In Buduhan v. Pakurao,24 we underscored the
significance of a tax declaration as proof that a holder has claim of title, and, we gave weight to the demonstrable interest of the claimant holding a tax receipt:

Although tax declarations or realty tax payment of property are not conclusive evidence of ownership, nevertheless, they are good indicia of possession in the concept of owner for no
one in his right mind would be paying taxes for a property that is not in his actual or at least constructive possession. They constitute at least proof that the holder has a claim of title
over the property. The voluntary declaration of a piece of property for taxation purposes manifests not only ones sincere and honest desire to obtain title to the property and announces
his adverse claim against the State and all other interested parties, but also the intention to contribute needed revenues to the Government. Such an act strengthens ones bona fide
claim of acquisition of ownership.25

It likewise failed to escape our attention that FGCI is in actual possession of the building and as the payment of taxes coupled with actual possession of the land covered by tax
declaration strongly supports a claim of ownership.26 Quite significantly, all the court processes in an earlier collection suit between FGCI and Villasi were served, thru the formers
representative Filomeno Garcia, at No. 140 Kalayaan Avenue, Quezon City, where the subject property is located. This circumstance is consistent with the tax declaration in the name
of FGCI.

The explanation proffered by the Spouses Garcia, that the City Assessor merely committed an error when it declared the property for taxation purposes in the name of FGCI, appears to
be suspect in the absence of any prompt and serious effort on their part to have it rectified before the onset of the instant controversy. The correction of entry belatedly sought by the
Spouses Garcia is indicative of its intention to put the property beyond the reach of the judgment creditor. Every prevailing party to a suit enjoys the corollary right to the fruits of the

judgment and, thus, court rules provide a procedure to ensure that every favorable judgment is fully satisfied.27 It is almost trite to say that execution is the fruit and end of the suit.
Hailing it as the "life of the law,"

ratio legis est anima,28 this Court has zealously guarded against any attempt to thwart the rigid rule and deny the prevailing litigant his right to savour the fruit of his victory.29 A
judgment, if left unexecuted, would be nothing but an empty triumph for the prevailing party.30

While it is a hornbook doctrine that the accessory follows the principal,31 that is, the ownership of the property gives the right by accession to everything which is produced thereby, or
which is incorporated or attached thereto, either naturally or artificially,32 such rule is not without exception. In cases where there is a clear and convincing evidence to prove that the
principal and the accessory are not owned by one and the same person or entity, the presumption shall not be applied and the actual ownership shall be upheld. In a number of cases,
we recognized the separate ownership of the land from the building and brushed aside the rule that accessory follows the principal.

In Carbonilla v. Abiera,33 we denied the claim of petitioner that, as the owner of the land, he is likewise the owner of the building erected thereon, for his failure to present evidence to
buttress his position:

To set the record straight, while petitioner may have proven his ownership of the land, as there can be no other piece of evidence more worthy of credence than a Torrens certificate of
title, he failed to present any evidence to substantiate his claim of ownership or right to the possession of the building. Like the CA, we cannot accept the Deed of Extrajudicial
Settlement of Estate (Residential Building) with Waiver and Quitclaim of Ownership executed by the Garcianos as proof that petitioner acquired ownership of the building. There is no
showing that the Garcianos were the owners of the building or that they had any proprietary right over it. Ranged against respondents proof of possession of the building since 1977,
petitioners evidence pales in comparison and leaves us totally unconvinced.34

In Caltex (Phil.) Inc. v. Felias,35 we ruled that while the building is a conjugal property and therefore liable for the debts of the conjugal partnership, the lot on which the building was
constructed is a paraphernal property and could not be the subject of levy and sale:

x x x. In other words, when the lot was donated to Felisa by her parents, as owners of the land on which the building was constructed, the lot became her paraphernal property. The
donation transmitted to her the rights of a landowner over a building constructed on it. Therefore, at the time of the levy and sale of the sheriff, Lot No. 107 did not belong to the conjugal
partnership, but it was paraphernal property of Felisa. As such, it was not answerable for the obligations of her husband which resulted in the judgment against him in favor of Caltex.36

The rule on accession is not an iron-clad dictum. On instances where this Court was confronted with cases requiring judicial determination of the ownership of the building separate
from the lot, it never hesitated to disregard such rule. The case at bar is of similar import. When there are factual and evidentiary evidence to prove that the building and the lot on which
it stands are owned by different persons, they shall be treated separately. As such, the building or the lot, as the case may be, can be made liable to answer for the obligation of its
respective owner.

Finally, the issue regarding the piercing of the veil of corporate fiction is irrelevant in this case. The Spouses Garcia are trying to protect FGCI from liability by asserting that they, not
FGCI, own the levied property. The Spouses Garcia are asserting their separation from FGCI. FGCI, the judgment debtor, is the proven owner of the building. Piercing FGCIs corporate
veil will not protect FGCI from its judgment debt. Piercing will result in the identification of the Spouses Garcia as FGCI itself and will make them liable for FGCIs judgment debt.

WHEREFORE, premises considered, the petition is GRANTED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 92587 are hereby REVERSED and
SET ASIDE. The Deputy Sheriff is hereby directed to proceed with the conduct of the sale on execution of the levied building.

SO ORDERED.

39. G.R. No. 192893

June 5, 2013

MANILA ELECTRIC COMPANY, Petitioner,

vs.
HEIRS OF SPOUSES DIONISIO DELOY and PRAXEDES MARTONITO, represented by POLICARPIO DELOY,Respondents.

DECISION

MENDOZA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking the reversal of the November 9, 2009 Decision' and the July 5, 2010 Resolution2 of the
Court of Appeals (CA), in CA-G.R. SP No. 96998. The challenged decision set aside the May 4, 2006 Resolution3 and the September 27, 2006 Order4 of the Regional Trial Court,
Trece Martires City, Branch 23 (RTC), which affirmed the dismissal of an unlawful detainer case by the Municipal Trial Court in Cities of Trece Martires City (MTCC).

The Facts

On July 8, 2003, Domingo Deloy, Maria Deloy-Masicap, Zosimo Deloy, Mario Deloy, Silveria Deloy-Mabiling, Norma Deloy, Milagros Panganiban, Lino Deloy, Cornelio Deloy, Maricel
Deloy, Adelina Banta, Rogelio Deloy, Evelyn Deloy, Edgardo Deloy, Cynthia Deloy, Donnabel Deloy, Glenda Deloy, Arnel Deloy, Ronnio Deloy, Isagani L. Reyes, and Policarpio Deloy
(respondents), all heirs of Spouses Dionisio Deloy (Dionisio) and Praxedes Martonito-Deloy, represented by Policarpio Deloy, instituted the Complaint for Unlawful Detainer5 against
Manila Electric Company (MERALCO) before the MTCC.

Respondents are the owners, by way of succession, of a parcel of land consisting of 8,550 square meters located in Trece Martires City (Trece Martires property). On November 12,
1965, Dionisio, respondents predecessor-in-interest, donated a 680-square meter portion (subject land) of the 8,550 square meter property to the Communications and Electricity
Development Authority (CEDA) for the latter to provide cheap and affordable electric supply to the province of Cavite. A deed of donation6 was executed to reflect and formalize the
transfer.

Sometime in 1985, CEDA offered for sale to MERALCO, its electric distribution system, consisting of transformers and accessories, poles and hardware, wires, service drops, and
customer meters and all rights and privileges necessary for providing electrical service in Cavite. This was embodied in a memorandum of agreement (MOA),7dated June 28, 1985,
signed by the parties.

On the same date, June 28, 1985, after the approval of the MOA, CEDA and MERALCO executed the Deed of Absolute Sale. Thereafter, MERALCO occupied the subject land.

On October 11, 1985, MERALCO, through its Assistant Vice President and Head of the Legal Department, Atty. L.D. Torres (Atty. Torres), wrote a letter8 to Dionisio requesting the
latters permission for the continued use of the subject land as a substation site.

The parties were not able to reach any agreement. In an internal memorandum,9 dated December 16, 1985, from L.G. De La Paz of the Trece Martires Substation of MERALCO to Atty.
G.R. Gonzales and Atty. Torres of the Realty Division of MERALCO, it was stated that the death of Dionisio, the lack of agreement yet among the heirs, and a request that a member of
the Deloy family be employed by MERALCO were some of the reasons.

Meanwhile, respondents claimed that they had no immediate use for the subject land and that they were preoccupied with the judicial proceedings to rectify errors involving the
reconstituted title of the Trece Martires property, which included the subject land. On November 22, 2001, the proceedings were terminated and the decision became final.10 Not long
after,respondents offered to sell the subject land to MERALCO, but their offer was rejected.

For said reason, in their letter,11 dated May 19, 2013, respondents demanded that MERALCO vacate the subject land on or before June 15, 2003. Despite the written demand,
MERALCO did not move out of the subject land. Thus, on July 8, 2003, respondents were constrained to file the complaint for unlawful detainer.

Traversing respondents complaint, MERALCO countered that CEDA, as the owner of the subject land by virtue of the deed of donation executed by Dionisio, lawfully sold to it all rights
necessary for the operation of the electric service in Cavite by way of a deed of sale on June 28, 1985.

MERALCO stressed that the condition of providing affordable electricity to the people of Cavite,12 imposed in the deed of donation between Dionisio and CEDA, was still being
observed and complied with. Thus, MERALCO claimed that, being CEDAs successor-in-interest, it had legal justification to occupy the subject land.

On September 15, 2005, the MTCC rendered the decision13 dismissing respondents complaint for unlawful detainer against MERALCO.

The MTCC ruled that it had no jurisdiction over the case because it would require an interpretation of the deed of donation making it one not capable of pecuniary estimation.
Nevertheless, it opined that MERALCO was entitled to the possession of the subject land. It was of the view that it would only be when the deed of donation would be revoked or the
deed of sale nullified that MERALCOs possession of the subject land would become unlawful.

Aggrieved, respondents appealed the MTCC ruling to the RTC. In its May 4, 2006 Resolution, the RTC sustained the MTCC decision.

The RTC pointed out that the only issue in an unlawful detainer case was possession. It affirmed the MTCC ruling that the latter had no jurisdiction to interpret contracts involving the
sale of the subject land to MERALCO, after the latter raised the issue of ownership of the subject land. According to the RTC, the interpretation of the deed of sale and the deed of
donation was the main, not merely incidental, issue.

Respondents moved for reconsideration but their motion was denied by the RTC in its September 27, 2006 Order.

Not satisfied with the adverse ruling, respondents elevated the case before the CA via a petition for review under Rule 42 of the Rules of Court.

In its November 9, 2001 Decision, the CA set aside the RTC ruling.

The fallo of the decision reads:

WHEREFORE, the instant Petition is GRANTED. The assailed Resolution, dated May 4, 2006, and Order, dated September 27, 2006, both of the Regional Trial Court of Trece Martires
City, Branch 23, in Civil Case No. TMCV-0055005, are hereby SET ASIDE and a new one rendered partially granting Petitioners Complaint for Unlawful Detainer against Respondent.
Accordingly, Respondent is ordered to vacate the subject property and to pay Petitioners the amount of P50,0000.00 monthly rental counting from June 16, 2003, up to the time
Respondent shall have fully vacated the subject property, and P25,000.00 as attorneys fees. Costs against Respondent.

SO ORDERED.14

In partially granting the appeal, the CA explained that an ejectment case, based on the allegation of possession by tolerance, would fall under the category of unlawful detainer.
Unlawful detainer involved the persons withholding from another of the possession of real property to which the latter was entitled, after the expiration or termination of the formers right
to hold possession under a contract, either express or implied. Where the plaintiff allowed the defendant to use his/her property by tolerance without any contract, the defendant was
necessarily bound by an implied promise that he/she would vacate on demand, failing which, an action for unlawful detainer would lie.

As to the issue of possession, the CA stated that by seeking Dionisios permission to continuously occupy the subject land, MERALCO expressly acknowledged his paramount right of
possession. MERALCO, thru its representative, Atty. Torres, would not have asked permission from Dionisio if it had an unconditional or superior right to possess the subject land. The
CA considered the fact that this recognition of Dionisios right over the subject land was amplified by another letter, dated December 16, 1985,15 by one L.G. De la Paz to Atty. Torres,
expressly declaring Dionisio as the owner of the subject land. MERALCO never disputed the declarations contained in these letters. Neither did it claim that the same was made through
palpable mistake. Indeed, Meralco even marked these letters as documentary exhibits. Pursuant to Section 26, Rule 130 of the Rules of Evidence, these admissions and/or declarations
may be admitted against Meralco.

MERALCO moved for reconsideration but its motion was denied by the CA in its July 5, 2010 Resolution.

Hence, this petition for review.

ISSUES

WHETHER OR NOT THE COMPLAINT STATES A CAUSE OF ACTION FOR UNLAWFUL DETAINER.

II

WHETHER OR NOT EVIDENCE ALIUNDE, SUCH AS THE LETTERS DATED 11 OCTOBER 1985 OF PETITIONERS ASSISTANT VICE PRESIDENT AND HEAD OF LEGAL
DEPARTMENT, L.D. TORRES AND INTERNAL MEMORANDUM DATED 6 DECEMBER 1985 OF PETITIONERS L.G. DELA PAZ WHICH PURPORTEDLY RECOGNIZED
RESPONDENTS OWNERSHIP OF THE PROPERTY CAN PREVAIL OVER THE DEED OF ABSOLUTE SALE.

III

WHETHER OR NOT TITLE TO THE PROPERTY DONATED TO CEDA WAS VALIDLY TRANSFERRED TO THE PETITIONER.

IV

WHETHER OR NOT THE SALE OF THE PROPERTY TO THE PETITIONER VIOLATED OR REVOKED THE DONATION TO CEDA.

WHETHER OR NOT THE COMPLAINT WAS BARRED BY PRESCRIPTION AND LACHES.16

Simply put, the vital issues for the Courts consideration are: (1) whether an action for unlawful detainer is the proper remedy in this case; and (2) if it is, who has a better right of
physical possession of the disputed property.

In presenting its case before the Court, MERALCO argues that respondents complaint before the MTCC failed to state a cause of action for unlawful detainer, but for one incapable of
pecuniary estimation, because the issue of physical possession is inextricably linked with the proper interpretation of the deed of donation executed between Dionisio and CEDA. Thus,
the MTCC was without jurisdiction to hear and decide the case. Further, MERALCO avers that it validly acquired title to the subject land by virtue of the deed of sale executed by CEDA
in its favor on June 28, 1985. As a consequence, MERALCO contends that extrinsic or extraneous evidence, such as the letters, dated October 11, 1985 and December 6, 1985, cannot
contradict the terms of the deed of sale between CEDA and MERALCO pursuant to Section 9, Rule 13017 of the Rules of Court.

The Courts Ruling

The petition lacks merit.

Unlawful detainer is an action to recover possession of real property from one who illegally withholds possession after the expiration or termination of his right to hold possession under
any contract, express or implied. The possession of the defendant in unlawful detainer is originally legal but became illegal due to the expiration or termination of the right to
possess.18 The only issue to be resolved in an unlawful detainer case is physical or material possession of the property involved, independent of any claim of ownership by any of the
parties involved.19

An ejectment case, based on the allegation of possession by tolerance, falls under the category of unlawful detainer. Where the plaintiff allows the defendant to use his/her property by
tolerance without any contract, the defendant is necessarily bound by an implied promise that he/she will vacate on demand, failing which, an action for unlawful detainer will lie.20

Jurisdiction of the MTCC

MERALCO contends that respondents complaint failed to make out a case for unlawful detainer but, rather, one incapable of pecuniary estimation, properly cognizable by the RTC and
not the MTCC. It stresses the allegations in the complaint involve a prior determination on the issue of ownership before the issue of possession can be validly resolved.

This contention fails to persuade.

When the issue of ownership is raised in an ejectment case, the first level courts are not ipso facto divested of its jurisdiction. Section 33 (2) of Batas Pambansa (B.P.) Blg. 129, as
amended by Republic Act (R.A.) No. 7691,21provides:

Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts in Civil Cases. Metropolitan Trial Courts, Municipal Trial Courts, and
Municipal Circuit Trial Courts shall exercise:

xxxx

(2) Exclusive original jurisdiction over cases of forcible entry and unlawful detainer: Provided, That when, in such cases, the defendant raises the question of ownership in his pleadings
and the question of possession cannot be resolved without deciding the issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession.
[Underscoring supplied.]

xxxx

In this regard, Section 16, Rule 70 of the Rules of Court allows the first level courts, in ejectment cases, to provisionally determine the issue of ownership for the sole purpose of
resolving the issue of physical possession.

Sec. 16. Resolving defense of ownership.When the defendant raises the defense of ownership in his pleadings and the question of possession cannot be resolved without deciding the
issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession.

Accordingly, it is unquestionably clear that the first level courts are clothed with the power to preliminarily resolve questions on the ownership of real property, if necessary, to arrive at
the proper and complete determination of the question on physical possession or possession de facto. Thus, as correctly ruled by the CA, the MTCC should have taken cognizance of
the complaint as it was well within its jurisdiction to do so. Moreover, considering that B.P. Blg. 129, as amended, has distinctly defined and granted the MTCC with jurisdiction, it is the
trial courts duty and obligation to exercise the same when properly invoked.

Right of Possession

As earlier stated, on the issue of possession, the CA opined that by seeking Dionisios permission to occupy the subject land, MERALCO expressly acknowledged his paramount right
of possession.

MERALCO posits that extrinsic evidence, such as the letter request, dated October 11, 1985, and the Internal Memorandum, dated December 6, 1985, cannot contradict the terms of
the deed of sale between CEDA and MERALCO pursuant to Section 9, Rule 13022 of the Rules of Court.

The Court has combed the records and is not convinced.

It is undisputed that on October 11, 1985 or four (4) months after the approval of the MOA and the corresponding Deed of Absolute Sale, MERALCO, through its Assistant Vice
President and Head of the Legal Department, Atty. Torres , sent a letter to Dionisio seeking his permission for the continued use of the subject land. The letter reads:

Mr. Dionisio Deloy

Trece Martires City 2724

Province of Cavite

Dear Mr. Deloy:

This has reference to the Deed of Donation (Inter-vivos) executed on November 12, 1965 between Communications and Electricity Development Authority (CEDA) and Dionisio D(e)loy
for a 680-square meter of land used as a substation site adjacent to A.B. Memorial Hospital x x x.

In compliance with the franchise Nationalization program of the National Government, we wish to inform you that Meralco had taken over the electric operations in the province of Cavite
being served by CEDA.

In view of this recent development, may we respectfully request you to please allow Manila Electric Company (Meralco) to continue the use of the above-mentioned portion of land as a
substation site, subject to the terms and conditions which we may mutually agree upon.

In the interest of public service, we shall highly appreciate your kind cooperation on this matter and awaiting your reply.

Very truly yours,

[Signed]

L. D. TORRES

Assistant Vice-President

& Head, Legal Department23

[Underscoring supplied]

Relative thereto, L.G. De La Paz of the Trece Martires Substation of MERALCO sent the December 16, 1985 Internal Memorandum, addressed to Atty. G.R. Gonzales and Atty. Torres,
informing them of some obstacles in reaching a lease agreement with the Deloys. The Internal Memorandum reads:

ATTY. G.R. GONZALES

ATTY. L.D. TORRES TRECE MARTIRES SUBTATION

REALTY SERVICES

DECEMBER 16, 1985

This refers to the proposed contract of lease with Mr. Dionisio Deloy, co-owner of the lot wherein the Trece Martires Substation is located.

Mr. Deloy had donated the use of 680-sq. m. portion of his co-owned land for CEDAs substation in Trece Martires in 1966. Copy of the Donation is enclosed. On October 11, 1985, the
company informed him through its letter of its intention of continuing with the use of the property as a result of its acquisition of CEDAs franchise. He agreed to the request and
proposed rental would be free provided one of his sons/grandsons would be employed by Meralco. Governor Remulla had favorably recommended Lino Deloy, one of his grandsons,
for a position in the company. A son, Mr. Policarpio Deloy, former CEDA employee, had passed Meralcos entrance examination. According to PAD, his application papers were being
processed by the Branch Services Department.

It was unfortunate that when we went to see him on December 6, 1985, to finalize the Contract of Lease, the man was already dead. His body laid at state in his residence. He died on
December 5, 1985. As it was not proper to discuss things with the family, we asked the wife when the family would be available. She suggested that we should come back on December
21, 1985. On that day, all the members of the family would be free to confer with us.

There are some problems that may come up with the death of Mr. Deloy. These are:

1. the settlement of his estate among his heirs

2. the desire to have more members of the family to be employed in Meralco

3. the rent free use of the substation may not push through

4. the proper signatories in the contract of lease to be drawn

We do hope whatever the problem may be, we will be able to work it out.

For your information.

[Signed]

L.G. DE LA PAZ

x x x x.

Evidently, by these two documents, MERALCO acknowledged that the owners of the subject land were the Deloys. It is clear as daylight. The first letter was written barely four (4)
months after the deed of sale was accomplished. As observed by the CA, MERALCO never disputed the declarations contained in these letters which were even marked as its own
exhibits. Pursuant to Section 26, Rule 130 of the Rules of Evidence, these admissions and/or declarations are admissible against MERALCO.

SEC. 26. Admissions of a party The act, declaration, or omission of a party as to a relevant fact may be given in evidence against him.

In Heirs of Bernardo Ulep v. Ducat,24 it was written, thus:

x x x Being an admission against interest, the documents are the best evidence which affords the greatest certainty of the facts in dispute. The rationale for the rule is based on the
presumption that no man would declare anything against himself unless such declaration was true. Thus, it is fair to presume that the declaration corresponds with the truth, and it is his
fault if it does not.

Guided by the foregoing rules and jurisprudence, the Court holds that the letter and the internal memorandum presented, offered and properly admitted as part of the evidence on
record by MERALCO itself, constitute an admission against its own interest. Hence, MERALCO should appropriately be bound by the contents of the documents.1wphi1

Nevertheless, in this petition, MERALCO insists that extrinsic evidence, such as the two documents, even if these were their own, cannot contradict the terms of the deed of sale
between CEDA and MERALCO pursuant to Section 9, Rule 13025 of the Rules of Court.

The Court has read the MOA and the Deed of Absolute Sale but found nothing that clearly stated that the subject land was included therein. What were sold, transferred and conveyed
were "its electric distribution facilities, service drops, and customers' electric meters except those owned by the VENDOR'S customers, x x x, and all the rights and privileges necessary
for the operation of the electric service x x x."26 No mention was made of any land. Rights and privileges could only refer to franchises, permits and authorizations necessary for the
operation of the electric service. The land on which the substation was erected was not included, otherwise, it would have been so stated in the two documents. Otherwise, also,
MERALCO would not have written Dionisio to ask permission for the continued use of the subject land.

At any rate, it is fundamental that a certificate of title serves as evidence of an indefeasible and incontrovertible title to the property in favor of the person whose name appears therein. It
bears to emphasize that the titleholder is entitled to all the attributes of ownership of the property, including possession.1wphi1 Thus, the Court must uphold the age-old rule that the
person who has a Torrens title over a land is entitled to its possession.27 In Pascual v. Coronel,28 the Court reiterated the rule that a certificate of title has a superior probative value as
against that of an unregistered deed of sale in ejectment cases.

On a final note, the Court must stress that the ruling in this case is limited only to the determination as to who between the parties has a better right to possession. This adjudication is
not a final determination on the issue of ownership and, thus, will not bar any party from filing an action raising the matter of ownership.

WHEREFORE, the petition is hereby DENIED.

SO ORDERED.

40. G.R. No. 182378

March 6, 2013

MERCY VDA. DE ROXAS, represented by ARLENE C. ROXAS-CRUZ, in her capacity as substitute appellant-petitioner, Petitioner,
vs.
OUR LADY'S FOUNDATION, INC., Respondent.

DECISION

SERENO, CJ.:

Before this Court is a Rule 45 Petition, seeking a review of the Court G.R. No. 174191

January 30, 2013

NENITA QUALITY FOODS CORPORATION, Petitioner,

vs.
CRISOSTOMO GALABO, ADELAIDA GALABO, and ZENAIDA GALABO-ALMACBAR, Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 of petitioner Nenita Quality Foods Corporation (NQFC) to nullity the February 22, 2006 Decision2 and the July 13, 2006 resolution3 of
the Court of Appeals (CA) in CA-G.R. SP No. 77006. The CA reversed the decision4 of the Regional Trial Court (RTC) of Davao City, Branch 17, which affirmed in toto the decision5 of
the Municipal Trial Court in Cities (MTCC), Davao City, Branch 5, in Civil Case No. 10,958-E-01. The MTCC dismissed the complaint for forcible entry and damages, which respondents
Crisostomo Galabo, Adelaida Galabo, and Zenaida Galabo-Almachar filed against NQFC.

The Factual Antecedents

The dispute in the case relates to the possession of a parcel of land described as Lot No. 102, PSD-40060, the former Arakaki Plantation in Marapangi, Toril, Davao City with an area of
six thousand seventy-four square meters (6,074 sq. m.).

As the CA summarized in the assailed decision, the respondents are the heirs of Donato Galabo. In 1948, Donato obtained Lot No. 722, Cad-102, a portion of the Arakaki Plantation in
Marapangi, Toril, Davao City, owned by National Abaca and Other Fibers Corporation. Donato and the respondents assumed that Lot No. 722 included Lot No. 102, per the original
survey of 1916 to 1920.

When the Board of Liquidators (BOL) took over the administration of the Arakaki Plantation in the 1950s, it had Lot No. 722 resurveyed. Allegedly, the resurvey did not include Lot No.
102; thus, when Donato acquired Transfer Certificate of Title No. T-214966 for Lot No. 722 on April 26, 1953, Lot No. 102 was not included. The respondents, however, continue to
posses, occupy and cultivate Lot No. 102.

When NQFC opened its business in Marapangi, Toril, Davao City in the late 1950s, it allegedly offered to buy Lot No. 102. Donato declined and to ward off further offers, put up "Not For
Sale" and "No Trespassing" signs on the property. In the 1970s, Crisostomo fenced off the entire perimeter of Lot No. 102 and built his house on it.

On August 19, 1994, the respondents received a letter from Santos Nantin demanding that they vacate Lot No. 102. Santos claimed ownership of this lot per the Deed of Transfer of
Rights (Deed of Transfer)7 dated July 10, 1972, which the respondents and their mother allegedly executed in Santos favor. The respondents denied this claim and maintained that
they had been occupying Lot No. 102, which the BOL itself recognized per its letters8 and the Certification9 dated April 12, 2000 confirming Donato as the long-time occupant and
awardee of the property. To perfect their title, the respondents applied for free patent over Lot No. 102 on September 6, 2000.

On January 3, 2001 and again on a later date, NQFCs workers, with armed policemen of Toril, Davao City, entered by force Lot No. 102 to fence it. The respondents reported the entry
to the authorities. On April 16, 2001, Crisostomo received a letter from NQFCs counsel demanding that he remove his house from Lot No. 102. NQFC subsequently removed the
existing fence and cut down various trees that the respondents had planted on the property.

NQFC, for its part, claimed that Santos immediately occupied and possessed Lot No. 102 after he purchased it from the respondents in 1972 and declared it under his name for taxation
purposes. Santos was also granted Free Patent over the property by the Bureau of Lands, and obtained Original Certificate of Title No. (OCT) P-403510 on June 18, 1974. On
December 29, 2000, the heirs of Santos conveyed Lot No. 102 to NQFC via the Deed of Absolute Sale11of even date. NQFC then filed a petition for cancellation of the respondents
patent application over Lot No. 102, which the BOL-Manila granted on April 19, 2001, on the ground that Donato failed to perfect his title over Lot No. 102 which has long been titled in
Santos name.

When conciliation failed, the respondents filed on September 17, 2001 a complaint12 for forcible entry with damages before the MTCC against NQFC, alleging that: (1) they had been in
prior physical possession of Lot No. 102; and (2) NQFC deprived them of possession through force, intimidation, strategy, threats and stealth.

The Ruling of the MTCC

Relying on the ruling of the BOL-Manila, the MTCC dismissed the respondents complaint,13 explaining that the questions raised before it required technical determination by the
administrative agency with the expertise to determine such matters, which the BOL-Manila did in this case.14

The MTCC held that the pieces of evidence NQFC presented the Deed of Transfer the respondents executed in Santos favor, Santos OCT P-4035 over Lot No. 102, the Deed of
Absolute Sale in NQFCs favor, and the findings of the BOL-Manila established NQFCs rightful possession over the property. It further held that: (1) the respondents relinquished their
rights over Lot No. 102 when they executed the Deed of Transfer in Santos favor; (2) the certificate of title over Lot No. 102 in Santos name shows that he was in actual physical
possession since actual occupation is required before an application for free patent can be approved; and (3) NQFC validly acquired ownership over Lot No. 102 when it purchased it
from Santos, entitling it to the right, among others, to possess the property as ancillary to such ownership.

The Ruling of the RTC

The respondents appealed the MTCC decision to the RTC but the latter court denied the appeal.15 As the MTCC did, the RTC relied on the findings of the BOL-Manila. It held that: (1)
the respondents failed to perfect whatever right they might have had over Lot No. 102; and (2) they are estopped from asserting any right over Lot No. 102 since they have long
transferred the property and their right thereto, to Santos in 1972.

In resolving the issue of possession of Lot No. 102, the RTC also resolved the question of ownership, as justified under the Rules, explaining that the NQFCs possession of Lot No. 102
was anchored on a Deed of Absolute Sale, while that of the respondents was based merely on the allegation of possession and occupation by Donato, and not on any title.16

Thus, the question of concurrent possession of Lot No. 102 between NQFC and the respondents should tilt in NQFCs favor.

When the RTC denied the respondents motion for reconsideration in an order17 dated March 5, 2003, the respondents elevated their case to the CA via a petition for review.18

The Ruling of the CA

The respondents claimed before the CA that the RTC erred when it held that NQFC had prior possession of Lot No. 102, based solely on its Deed of Absolute Sale. They argued,
among others, that: (1) Santos should have taken the necessary steps to oust the respondents had he been in possession of Lot No. 102 beginning 1972; (2) Santos could not have
validly obtained title over Lot No. 102 since it was still in the name of the Republic of the Philippines (Republic) as of 1980;19 and (3) NQFC no longer had to forcibly evict the
respondents in January 2001 if it had been in possession of Lot No. 102 after it bought this land from Santos in 2000.

The CA found reversible error in the RTCs decision; thus, it granted the respondents petition and ordered NQFC to vacate Lot No. 102. The CA explained that a plaintiff, in a forcible
entry case, only has to prove prior material and physical possession of the property in litigation and undue deprivation of it by means of force, intimidation, threat, strategy or stealth.
These, the respondents averred in the complaint and sufficiently proved, thus entitling them to recover possession of Lot No. 102. Relying on the doctrine of presumption of regularity in
the performance of official duty, the CA especially took note of the letters and the Certification which the BOL sent to the respondents acknowledging Donato as the awardee of Lot No.
102 and the respondents as the actual occupants and possessors.

In brushing aside the RTCs findings, the CA ruled that: (1) Donatos failure to perfect his title over Lot No. 102 should not weigh against the respondents as the issue in a forcible entry
case is one of possession de facto and not of possession de jure; and (2) NQFCs ownership of Lot No. 102 is beside the point as ownership is beyond the purview of an ejectment

case. The title or right of possession, it stressed, is never an issue in a forcible entry suit. The CA, however, denied the respondents prayer for moral damages and attorneys fees, and
rejected the other issues raised for being irrelevant.

In its July 13, 2006 resolution,20 the CA denied NQFCs motion for reconsideration, prompting the NQFCs present recourse.

The Petition

NQFC argues that the CA erred in holding that the respondents had prior physical possession of Lot No. 102.21 It claims that, first, in reversing the RTC findings, the CA relied solely on
the letters and the Certification of the BOL,22which has been controverted by the following pieces of evidence, among others: (1) the Deed of Transfer that the respondents executed in
favor of Santos; (2) the order of the Bureau of Lands approving Santos patent application; (3) Santos OCT P-4035; and (4) the Deed of Absolute Sale that Santos executed in favor of
NQFC.

NQFC maintains that the Bureau of Lands would not have granted Santos free patent application had he not been in possession of Lot No. 102 because continued occupation and
cultivation, either by himself or by his predecessor-in-interest, of the property is a requirement for such grant under the Public Land Act. By the very definition of "occupy," Santos is
therefore deemed to have possessed Lot No. 102 prior to 1974, the year his free patent application was granted,23 and under the principle of tacking of possession, he is deemed to
have had possession of Lot No. 102 not only from 1972, when the respondents transferred it to him, but also from the time Donato acquired the lot in 1948. Thus, Santos had no reason
to oust the respondents since he had been in possession of Lot No. 102 beginning 1972, by virtue of the transfer.24

Second, the respondents had no documents to prove that they were in actual occupation and cultivation of Lot No. 102 the reason they did not heed the BOLs request to perfect their
title over it. Finally, citing jurisprudence,25NQFC argues that the RTC rightly ruled on the issue of its ownership over Lot No. 102 in deciding the issue of prior physical possession as
the Rules allow this, by way of exception.26

The Case for Respondents

The respondents arguments closely adhere to the CAs ruling. They argue that NQFC, rather than meeting the issues, focused on its alleged ownership of Lot No. 102 and the
possession flowing out of its ownership. They deny ever meeting Santos and they maintain that their continued possession and occupation of Lot No. 102 belie this supposed sale.
Even granting that this sale occurred, Santos could still not have acquired any right over Lot No. 102 for as of 1980, it was still in the name of the Republic.27 Thus, they could not have
transferred ownership of Lot No. 102 to Santos, and he cannot claim ownership of Lot No. 102 by reason of this sale.28

On the other hand, the respondents open, continuous, exclusive, notorious and adverse possession of Lot No. 102 for three decades, coupled by a claim of ownership, gave them
vested right or interest over the property.29 This vested right is equivalent to an actually issued certificate of title so that the execution and delivery of the title is a mere formality. To say
the least, NQFC did not have to send them a formal demand to vacate30 and violently oust them from the premises had it been in actual possession of the property as claimed.31

Lastly, the respondents invoked the settled rule that the Courts jurisdiction in a Rule 45 petition is limited only to reviewing errors of law. NQFC failed to show misapprehension of facts
in the CAs findings to justify a departure from this rule.32

The Courts Ruling

We first address the procedural issue raised. Resolving the contentions raised necessarily requires us to delve into factual issues, a course not proper in a petition for review on
certiorari, for a Rule 45 petition resolves only questions of law, not questions of fact.33 This rule is read with the equally settled dictum that factual findings of the CA are generally
conclusive on the parties and are therefore not reviewable by this Court.34 By way of exception, we resolve factual issues when, as here, conflict attended the findings of the MTCC and
of the RTC, on one hand, and of the CA, on the other. Of minor note, but which we deem important to point, the petition needlessly impleaded the CA, in breach of Section 4, Rule 45 of
the Rules of Court.35

Substantively, the key issue this case presents is prior physical possession whether NQFC had been in prior physical possession of Lot No. 102.

We rule in the negative.

First, on the reliance on the BOL letters and Certification and the CAs alleged disregard of NQFCs evidence. To prove prior physical possession of Lot No. 102, NQFC presented the
Deed of Transfer, Santos OCT P-4035, the Deed of Absolute Sale, and the Order of the Bureau of Lands approving Santos free patent application. In presenting these pieces of
evidence, NQFC is apparently mistaken as it may have equated possession that is at issue as an attribute of ownership to actual possession. The latter type of possession is, however,
different from and has different legal implications than the former. While these documents may bear weight and are material in contests over ownership of Lot No. 102, they do not per
se show NQFCs actual possession of this property.

We agree that ownership carries the right of possession, but the possession contemplated by the concept of ownership is not exactly the same as the possession in issue in a forcible
entry case. Possession in forcible entry suits refers only to possession de facto, or actual or material possession, and not possession flowing out of ownership; these are different legal
concepts36 for which the law provides different remedies for recovery of possession.37 As we explained in Pajuyo v. Court of Appeals,38 and again in the more recent cases of
Gonzaga v. Court of Appeals,39 De Grano v. Lacaba,40 and Lagazo v. Soriano,41 the word "possession" in forcible entry suits refers to nothing more than prior physical possession or
possession de facto, not possession de jure42 or legal possession in the sense contemplated in civil law.43 Title is not the issue,44 and the absence of it "is not a ground for the courts
to withhold relief from the parties in an ejectment case."45

Thus, in a forcible entry case, "a party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the character of his possession,
if he has in his favor prior possession in time, he has the security that entitles him to remain on the property until a person with a better right lawfully ejects him."46He cannot be ejected
by force, violence or terror -- not even by its owners.47 For these reasons, an action for forcible entry is summary in nature aimed only at providing an expeditious means of protecting
actual possession.48Ejectment suits are intended to "prevent breach of x x x peace and criminal disorder and to compel the party out of possession to respect and resort to the law
alone to obtain what he claims is his."49 Thus, lest the purpose of these summary proceedings be defeated, any discussion or issue of ownership is avoided unless it is necessary to
resolve the issue of de facto possession.

We agree with the respondents that instead of squarely addressing the issue of possession and presenting evidence showing that NQFC or Santos had been in actual possession of
Lot No. 102, the former merely narrated how it acquired ownership of Lot No. 102 and presented documents to this effect. Its allegation that Santos occupied Lot No. 102 in 1972 is
uncorroborated. Even the tax declarations under Santos name are hardly of weight; "tax declarations and realty tax payments are not conclusive proof of possession. They are merely
good indicia of possession in the concept of owner"50 but not necessarily of the actual possession required in forcible entry cases.

Section 1, Rule 70 of the Rules of Court provides when an action for forcible entry, and unlawful detainer, is proper:

SECTION 1. Who may institute proceedings, and when. Subject to the provisions of the next succeeding section, a person deprived of the possession of any land or building by
force, intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person against whom the possession of any land or building is unlawfully withheld after the expiration
or termination of the right to hold possession, by virtue of any contract, express or implied, or the legal representatives or assigns of any such lessor, vendor, vendee, or other person
may at any time within one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper Municipal Trial Court against the person or persons
unlawfully withholding or depriving of possession, or any person or persons claiming under them, for the restitution of such possession, together with damages and costs. [emphasis
ours; italics supplied]

Under this provision, for a forcible entry suit to prosper, the plaintiff must allege and prove: (1) prior physical possession of the property; and (2) unlawful deprivation of it by the
defendant through force, intimidation, strategy, threat or stealth.51 As in any civil case, the burden of proof lies with the complainants (the respondents in this case) who must establish
their case by preponderance of evidence. In the present case, the respondents sufficiently alleged and proved the required elements.

To support its position, NQFC invokes the principle of tacking of possession, that is, when it bought Lot No. 102 from Santos on December 29, 2000, its possession is, by operation of
law, tacked to that of Santos and even earlier, or at the time Donato acquired Lot No. 102 in 1948.

NQFCs reliance on this principle is misplaced. True, the law52 allows a present possessor to tack his possession to that of his predecessor-in-interest to be deemed in possession of
the property for the period required by law. Possession in this regard, however, pertains to possession de jure and the tacking is made for the purpose of completing the time required
for acquiring or losing ownership through prescription. We reiterate possession in forcible entry suits refers to nothing more than physical possession, not legal possession.

The CA brushed aside NQFCs argument on the respondents failure to perfect their title over Lot No. 102. It held that the issue in this case is not of possession de jure, let alone
ownership or title, but of possession de facto.1wphi1 We agree with the CA; the discussions above are clear on this point.

We agree, too, as we have indicated in passing above, that the issue of ownership can be material and relevant in resolving the issue of possession. The Rules in fact expressly allow
this: Section 16, Rule 70 of the Rules of Court53provides that the issue of ownership shall be resolved in deciding the issue of possession if the question of possession is intertwined

with the issue of ownership. But this provision is only an exception and is allowed only in this limited instance-- to determine the issue of possession and only if the question of
possession cannot be resolved without deciding the issue of ownership.54 Save for this instance, evidence of ownership is not at all material, as in the present case.55

As a final reiterative note, this Decision deals only with de facto possession and is without prejudice to an appropriate action for recovery of possession based on ownership.

WHEREFORE, in light of these considerations, we hereby DENY the petition; the decision dated February 22, 2006 and the resolution dated July 13, 2006 of the Court of Appeals in
CA-G.R. SP No. 77006 are hereby AFFIRMED.

SO ORDERED.

of Appeals (CA) 25 September 2007 Decision1and 11 March 2008 Resolution2 in CA-G.R. SP No. 88622, which nullified the (1) Notices of Garnishment directed against the bank
accounts of petitioner's general manager; and (2) the 2 December 2004 Order3 in Civil Case No. 5403 of the Regional Trial Court (RTC) of Sorsogon City, Branch 52. The Order
required respondent to reimburse petitioner Pl ,800 per square meter of the 92-square-meter property it had encroached upon.

The antecedent facts are as follows:

On 1 September 1988, Salve Dealca Latosa filed before the RTC a Complaint for the recovery of ownership of a portion of her residential land located at Our Ladys Village, Bibincahan,
Sorsogon, Sorsogon, docketed as Civil Case No. 5403. According to her, Atty. Henry Amado Roxas (Roxas), represented by petitioner herein, encroached on a quarter of her property
by arbitrarily extending his concrete fence beyond the correct limits.

In his Answer, Roxas imputed the blame to respondent Our Ladys Village Foundation, Inc., now Our Ladys Foundation, Inc. (OLFI). He then filed a Third-Party Complaint against
respondent and claimed that he only occupied the adjoining portion in order to get the equivalent area of what he had lost when OLFI trimmed his property for the subdivision road. The
RTC admitted the Third-Party Complaint and proceeded to trial on the merits.

After considering the evidence of all the parties, the trial court held that Latosa had established her claim of encroachment by a preponderance of evidence. It found that Roxas
occupied a total of 112 square meters of Latosas lots, and that, in turn, OLFI trimmed his property by 92 square meters. The dispositive portion of the Decision4 reads:

WHEREFORE, the Court hereby renders judgment as follows:

On the Complaint:

1. Ordering the defendant to return and surrender the portion of 116 sq. meters which lawfully belongs to the plaintiff being a portion of Lot 19;

2. Ordering defendant to demolish whatever structure constructed [sic] thereon and to remove the same at his own expense;

3. Ordering defendant to. reimburse plaintiff the amount of P1,500.00 for the expenses in the relocation survey;

4. Ordering the dismissal of the counter claim.

On the 3rd Party Complaint:

1. Ordering the 3rd Party Defendant to reimburse 3rd Party Plaintiff the value of 92 sq. meters which is a portion of Lot 23 of the def-3rd Party Plaintiff plus legal interest to
be reckoned from the time it was paid to the 3rd Party Defendant;

2. 3rd Party Defendant is ordered to pay the 3rd Party Plaintiff the sum of P10,000.00 as attorney's fees andP5,000 as litigation expenses;

3. 3rd Party Defendant shall pay the cost of suit.

SO ORDERED.5

Subsequently, Roxas appealed to the CA, which later denied the appeal. Since the Decision had become final, the RTC issued a Writ of Execution6 to implement the ruling ordering
OLFI to reimburse Roxas for the value of the 92-square-meter property plus legal interest to be reckoned from the time the amount was paid to the third-party defendant. The trial court
then approved the Sheriffs Bill,7 which valued the subject property at P2,500 per square meter or a total of P230,000. Adding the legal interest of 12% per annum for 10 years,
respondents judgment obligations totaled P506,000.

Opposing the valuation of the subject property, OLFI filed a Motion to Quash the Sheriffs Bill and a Motion for Inhibition of the RTC judge. It insisted that it should reimburse Roxas only
at the rate of P40 per square meter, the same rate that Roxas paid when the latter first purchased the property. Nevertheless, before resolving the Motions filed by OLFI, the trial court
approved an Amended Sheriffs Bill,8 which reduced the valuation to P1,800 per square meter.

Eventually, the RTC denied both the Motion for Inhibition and the Motion to Quash the Sheriffs Bill. It cited fairness to justify the computation of respondents judgment obligation found
in the Amended Sheriffs Bill. In its 2 December 2004 Order, the trial court explained:

Although it might be true that the property was originally purchased at P40.00 per square meter, the value of the Philippine Peso has greatly devaluated since then P40.00 may be able
to purchase a square meter of land twenty (20) or more years ago but it could only buy two (2) kilos of rice today. It would be most unfair to the defendants-third party plaintiff if the third
party defendant would only be made to reimburse the purchase price at P40.00 per square meter. Anyway, this Court is in the best position to determine what amount should be
reimbursed since it is the one who rendered the decision which was affirmed in toto by the Appellate Court and this Court is of the opinion and so holds that that amount should
be P1,800.00 per square meter.9

To collect the aforementioned amount, Notices of Garnishment10 were then issued by the sheriff to the managers of the Development Bank of the Philippines and the United Coconut
Planters Bank for them to garnish the account of Bishop Robert Arcilla-Maullon (Arcilla-Maullon), OLFIs general manager.

Refusing to pay P1,800 per square meter to Roxas, OLFI filed a Rule 65 Petition before the CA.11 Respondent asserted that since the dispositive portion of the Decision ordered it to
reimburse Roxas, it should only be made to return the purchase price that he had originally paid, which was P40 per square meter for the 92-square-meter property.

Petitioner argues otherwise. Roxas first clarified that the dispositive portion of the Decision is silent as to the value of the subject property whether the value is to be reckoned from the
date of purchase or from the date of payment after the finality of judgment.12 Following this clarification, petitioner pointed out that the valuation of the subject property was for the trial
court to undertake, and that the reimbursement contemplated referred to the repayment of all the expenses, damages, and losses. Roxas ultimately argued that the payment for the
property encroached upon must not be absurd and must take into consideration the devaluation of the Philippine peso.

The arguments of Roxas did not persuade the CA. It construed reimbursement as an obligation to pay back what was previously paid and thus required OLFI to merely reimburse him at
the rate of P40 per square meter, which was the consideration respondent had received when Roxas purchased the subdivision lots. Therefore, for changing the tenor of the RTC
Decision by requiring the reimbursement of P1,800 per square meter, both the Amended Sheriffs Bill and the 2 December 2004 Order of the RTC were considered null and void.

Further, the CA nullified the Notices of Garnishment issued against the bank accounts of Arcilla-Maullon. It noted that since the general manager of OLFI was not impleaded in the
proceedings, he could not be held personally liable for the obligation of the corporation.

Before this Court, petitioner maintains that OLFI should be made to pay P1,800, and not P40 per square meter as upheld in the 2 December 2004 Order of the RTC.13 For the
immediate enforcement of the Order, petitioner further argues that because OLFI is a dummy corporation, the bank accounts of its general manager can be garnished to collect the
judgment obligation of respondent.14

Hence, the pertinent issue in this case requires the determination of the correct amount to be reimbursed by OLFI to Roxas. As a corollary matter, this Court also resolves the propriety
of issuing the Notices of Garnishment against the bank accounts of Arcilla-Maullon as OLFIs general manager.

RULING OF THE COURT

Based on the dispositive portion of the RTC Decision, OLFI was ordered to reimburse Roxas for the value of the 92-square-meter property plus legal interest to be reckoned from the
time it was paid to the third-party defendant.

In interpreting this directive, both the trial and the appellate courts differed in interpreting the amount of reimbursement payable by respondent to petitioner. The RTC pegged the
reimbursable amount at P1,800 per square meter to reflect the current value of the property, while the CA maintained the original amount of the lot atP40 per square meter.

To settle the contention, this Court resorts to the provisions of the Civil Code governing encroachment on property. Under Article 448 pertaining to encroachments in good faith, as well
as Article 450 referring to encroachments in bad faith, the owner of the land encroached upon petitioner herein has the option to require respondent builder to pay the price of the
land.

Although these provisions of the Civil Code do not explicitly state the reckoning period for valuing the property, Ballatan v. Court of Appeals15 already specifies that in the event that the
seller elects to sell the lot, "the price must be fixed at the prevailing market value at the time of payment." More recently, Tuatis v. Spouses Escol16 illustrates that the present or current

fair value of the land is to be reckoned at the time that the landowner elected the choice, and not at the time that the property was purchased. We quote below the relevant portion of
that Decision:17

Under the second option, Visminda may choose not to appropriate the building and, instead, oblige Tuatis to pay the present or current fair value of the land. The P10,000.00 price of
the subject property, as stated in the Deed of Sale on Installment executed in November 1989, shall no longer apply, since Visminda will be obliging Tuatis to pay for the price of the
land in the exercise of Vismindas rights under Article 448 of the Civil Code, and not under the said Deed. Tuatis obligation will then be statutory, and not contractual, arising only when
Visminda has chosen her option under Article 448 of the Civil Code.

Still under the second option, if the present or current value of the land, the subject property herein, turns out to be considerably more than that of the building built thereon, Tuatis
cannot be obliged to pay for the subject property, but she must pay Visminda reasonable rent for the same. Visminda and Tuatis must agree on the terms of the lease; otherwise, the
court will fix the terms. (Emphasis supplied)

In Sarmiento v. Agana,18 we reckoned the valuation of the property at the time that the real owner of the land asked the builder to vacate the property encroached upon. Moreover, the
oft-cited case Depra v. Dumlao19 likewise ordered the courts of origin to compute the current fair price of the land in cases of encroachment on real properties.

From these cases, it follows that the CA incorrectly pegged the reimbursable amount at the old market value of the subject property P40 per square meter as reflected in the Deed
of Absolute Sale20 between the parties. On the other hand, the RTC properly considered in its 2 December 2004 Order the value of the lot at P1,800 per square meter, the current fair
price as determined in the Amended Sheriffs Bill. Thus, we reverse the ruling of the CA and reinstate the 2 December 2004 Order of the RTC directing OLFI to reimburse petitioner
at P1,800 per square meter.

Nevertheless, with regard to the issue pertaining to the Notices of Garnishment issued against the bank accounts of Arcilla-Maullon, we affirm the ruling of the CA.

The appellate court appreciated that in the main case for the recovery of ownership before the court of origin, only OLFI was named as respondent corporation, and that its general
manager was never impleaded in the proceedings a quo.

Given this finding, this Court holds that since OLFIs general manager was not a party to the case, the CA correctly ruled that Arcilla-Maullon cannot be held personally liable for the
obligation of the corporation. In Santos v. NLRC,21this Court upholds the doctrine of separate juridical personality of corporate entities. The case emphasizes that a corporation is a
juridical entity with a legal personality separate and distinct from those acting for and on its behalf and, in general, of the people comprising it.22 Hence, the obligations incurred by the
corporation, acting through its officers such as in this case, are its sole liabilities.23

To hold the general manager of OLFI liable, petitioner claims that it is a mere business conduit of Arcilla-Maullon, hence, the corporation does not maintain a bank account separate and
distinct from the bank accounts of its members. In support of this claim, petitioner submits that because OLFI did not rebut the attack on its legal personality, as alleged in petitioners
Opposition and Comments on the Motion to Quash Notice/Writ of Garnishment dated 15 March 2005,24 respondent effectively admitted by its silence that it was a mere dummy
corporation.

This argument does not persuade us, for any piercing of the corporate veil has to be done with caution.25 Save for its rhetoric, petitioner fails to adduce any evidence that would prove
OLFI's status as a dummy corporation. In this regard, we recently explained in Sarona v. NLRC26 as follows:

A court should be mindful of the milieu where it is to be applied.1wphi1 It must be certain that the corporate fiction was misused to such an extent that injustice, fraud, or crime was
committed against another, in disregard of rights. The wrongdoing must be clearly and convincingly established; it cannot be presumed. Otherwise, an injustice that was never
unintended may result from an erroneous application. (Citation omitted)

In any event, in order for us to hold Arcilla-Maullon personally liable alone for the debts of the corporation and thus pierce the veil of corporate fiction, we have required that the bad faith
of the officer must first be established clearly and convincingly.27 Petitioner, however, has failed to include any submission pertaining to any wrongdoing of the general manager.
Necessarily, it would be unjust to hold the latter personally liable.

Therefore, we refuse to allow the execution of a corporate judgment debt against the general manager of the corporation, since in no legal sense is he the owner of the corporate
property.28 Consequently, this Court sustains the CA in nullifying the Notices of Garnishment against his bank accounts.

IN VIEW THEREOF, the 25 September 2007 Decision and 11 March 2008 Resolution of the Court of Appeals in CA-GR SP No. 88622 are AFFIRMED with MODIFICATION in that the
value of the 92-square-meter property for which respondent should reimburse petitioner, as determined by the 2 December 2004 Order of the Regional Trial Court in Civil Case No.
5403, is hereby reinstated at P1,800 per square meter.

SO ORDERED.

41. G.R. No. 174191

January 30, 2013

NENITA QUALITY FOODS CORPORATION, Petitioner,

vs.
CRISOSTOMO GALABO, ADELAIDA GALABO, and ZENAIDA GALABO-ALMACBAR, Respondents.

DECISION

BRION, J.:

We resolve the petition for review on certiorari1 of petitioner Nenita Quality Foods Corporation (NQFC) to nullity the February 22, 2006 Decision2 and the July 13, 2006 resolution3 of
the Court of Appeals (CA) in CA-G.R. SP No. 77006. The CA reversed the decision4 of the Regional Trial Court (RTC) of Davao City, Branch 17, which affirmed in toto the decision5 of
the Municipal Trial Court in Cities (MTCC), Davao City, Branch 5, in Civil Case No. 10,958-E-01. The MTCC dismissed the complaint for forcible entry and damages, which respondents
Crisostomo Galabo, Adelaida Galabo, and Zenaida Galabo-Almachar filed against NQFC.

The Factual Antecedents

The dispute in the case relates to the possession of a parcel of land described as Lot No. 102, PSD-40060, the former Arakaki Plantation in Marapangi, Toril, Davao City with an area of
six thousand seventy-four square meters (6,074 sq. m.).

As the CA summarized in the assailed decision, the respondents are the heirs of Donato Galabo. In 1948, Donato obtained Lot No. 722, Cad-102, a portion of the Arakaki Plantation in
Marapangi, Toril, Davao City, owned by National Abaca and Other Fibers Corporation. Donato and the respondents assumed that Lot No. 722 included Lot No. 102, per the original
survey of 1916 to 1920.

When the Board of Liquidators (BOL) took over the administration of the Arakaki Plantation in the 1950s, it had Lot No. 722 resurveyed. Allegedly, the resurvey did not include Lot No.
102; thus, when Donato acquired Transfer Certificate of Title No. T-214966 for Lot No. 722 on April 26, 1953, Lot No. 102 was not included. The respondents, however, continue to
posses, occupy and cultivate Lot No. 102.

When NQFC opened its business in Marapangi, Toril, Davao City in the late 1950s, it allegedly offered to buy Lot No. 102. Donato declined and to ward off further offers, put up "Not For
Sale" and "No Trespassing" signs on the property. In the 1970s, Crisostomo fenced off the entire perimeter of Lot No. 102 and built his house on it.

On August 19, 1994, the respondents received a letter from Santos Nantin demanding that they vacate Lot No. 102. Santos claimed ownership of this lot per the Deed of Transfer of
Rights (Deed of Transfer)7 dated July 10, 1972, which the respondents and their mother allegedly executed in Santos favor. The respondents denied this claim and maintained that
they had been occupying Lot No. 102, which the BOL itself recognized per its letters8 and the Certification9 dated April 12, 2000 confirming Donato as the long-time occupant and
awardee of the property. To perfect their title, the respondents applied for free patent over Lot No. 102 on September 6, 2000.

On January 3, 2001 and again on a later date, NQFCs workers, with armed policemen of Toril, Davao City, entered by force Lot No. 102 to fence it. The respondents reported the entry
to the authorities. On April 16, 2001, Crisostomo received a letter from NQFCs counsel demanding that he remove his house from Lot No. 102. NQFC subsequently removed the
existing fence and cut down various trees that the respondents had planted on the property.

NQFC, for its part, claimed that Santos immediately occupied and possessed Lot No. 102 after he purchased it from the respondents in 1972 and declared it under his name for taxation
purposes. Santos was also granted Free Patent over the property by the Bureau of Lands, and obtained Original Certificate of Title No. (OCT) P-403510 on June 18, 1974. On
December 29, 2000, the heirs of Santos conveyed Lot No. 102 to NQFC via the Deed of Absolute Sale11of even date. NQFC then filed a petition for cancellation of the respondents
patent application over Lot No. 102, which the BOL-Manila granted on April 19, 2001, on the ground that Donato failed to perfect his title over Lot No. 102 which has long been titled in
Santos name.

When conciliation failed, the respondents filed on September 17, 2001 a complaint12 for forcible entry with damages before the MTCC against NQFC, alleging that: (1) they had been in
prior physical possession of Lot No. 102; and (2) NQFC deprived them of possession through force, intimidation, strategy, threats and stealth.

The Ruling of the MTCC

Relying on the ruling of the BOL-Manila, the MTCC dismissed the respondents complaint,13 explaining that the questions raised before it required technical determination by the
administrative agency with the expertise to determine such matters, which the BOL-Manila did in this case.14

The MTCC held that the pieces of evidence NQFC presented the Deed of Transfer the respondents executed in Santos favor, Santos OCT P-4035 over Lot No. 102, the Deed of
Absolute Sale in NQFCs favor, and the findings of the BOL-Manila established NQFCs rightful possession over the property. It further held that: (1) the respondents relinquished their
rights over Lot No. 102 when they executed the Deed of Transfer in Santos favor; (2) the certificate of title over Lot No. 102 in Santos name shows that he was in actual physical
possession since actual occupation is required before an application for free patent can be approved; and (3) NQFC validly acquired ownership over Lot No. 102 when it purchased it
from Santos, entitling it to the right, among others, to possess the property as ancillary to such ownership.

The Ruling of the RTC

The respondents appealed the MTCC decision to the RTC but the latter court denied the appeal.15 As the MTCC did, the RTC relied on the findings of the BOL-Manila. It held that: (1)
the respondents failed to perfect whatever right they might have had over Lot No. 102; and (2) they are estopped from asserting any right over Lot No. 102 since they have long
transferred the property and their right thereto, to Santos in 1972.

In resolving the issue of possession of Lot No. 102, the RTC also resolved the question of ownership, as justified under the Rules, explaining that the NQFCs possession of Lot No. 102
was anchored on a Deed of Absolute Sale, while that of the respondents was based merely on the allegation of possession and occupation by Donato, and not on any title.16

Thus, the question of concurrent possession of Lot No. 102 between NQFC and the respondents should tilt in NQFCs favor.

When the RTC denied the respondents motion for reconsideration in an order17 dated March 5, 2003, the respondents elevated their case to the CA via a petition for review.18

The Ruling of the CA

The respondents claimed before the CA that the RTC erred when it held that NQFC had prior possession of Lot No. 102, based solely on its Deed of Absolute Sale. They argued,
among others, that: (1) Santos should have taken the necessary steps to oust the respondents had he been in possession of Lot No. 102 beginning 1972; (2) Santos could not have
validly obtained title over Lot No. 102 since it was still in the name of the Republic of the Philippines (Republic) as of 1980;19 and (3) NQFC no longer had to forcibly evict the
respondents in January 2001 if it had been in possession of Lot No. 102 after it bought this land from Santos in 2000.

The CA found reversible error in the RTCs decision; thus, it granted the respondents petition and ordered NQFC to vacate Lot No. 102. The CA explained that a plaintiff, in a forcible
entry case, only has to prove prior material and physical possession of the property in litigation and undue deprivation of it by means of force, intimidation, threat, strategy or stealth.
These, the respondents averred in the complaint and sufficiently proved, thus entitling them to recover possession of Lot No. 102. Relying on the doctrine of presumption of regularity in
the performance of official duty, the CA especially took note of the letters and the Certification which the BOL sent to the respondents acknowledging Donato as the awardee of Lot No.
102 and the respondents as the actual occupants and possessors.

In brushing aside the RTCs findings, the CA ruled that: (1) Donatos failure to perfect his title over Lot No. 102 should not weigh against the respondents as the issue in a forcible entry
case is one of possession de facto and not of possession de jure; and (2) NQFCs ownership of Lot No. 102 is beside the point as ownership is beyond the purview of an ejectment
case. The title or right of possession, it stressed, is never an issue in a forcible entry suit. The CA, however, denied the respondents prayer for moral damages and attorneys fees, and
rejected the other issues raised for being irrelevant.

In its July 13, 2006 resolution,20 the CA denied NQFCs motion for reconsideration, prompting the NQFCs present recourse.

The Petition

NQFC argues that the CA erred in holding that the respondents had prior physical possession of Lot No. 102.21 It claims that, first, in reversing the RTC findings, the CA relied solely on
the letters and the Certification of the BOL,22which has been controverted by the following pieces of evidence, among others: (1) the Deed of Transfer that the respondents executed in
favor of Santos; (2) the order of the Bureau of Lands approving Santos patent application; (3) Santos OCT P-4035; and (4) the Deed of Absolute Sale that Santos executed in favor of
NQFC.

NQFC maintains that the Bureau of Lands would not have granted Santos free patent application had he not been in possession of Lot No. 102 because continued occupation and
cultivation, either by himself or by his predecessor-in-interest, of the property is a requirement for such grant under the Public Land Act. By the very definition of "occupy," Santos is
therefore deemed to have possessed Lot No. 102 prior to 1974, the year his free patent application was granted,23 and under the principle of tacking of possession, he is deemed to
have had possession of Lot No. 102 not only from 1972, when the respondents transferred it to him, but also from the time Donato acquired the lot in 1948. Thus, Santos had no reason
to oust the respondents since he had been in possession of Lot No. 102 beginning 1972, by virtue of the transfer.24

Second, the respondents had no documents to prove that they were in actual occupation and cultivation of Lot No. 102 the reason they did not heed the BOLs request to perfect their
title over it. Finally, citing jurisprudence,25NQFC argues that the RTC rightly ruled on the issue of its ownership over Lot No. 102 in deciding the issue of prior physical possession as
the Rules allow this, by way of exception.26

The Case for Respondents

The respondents arguments closely adhere to the CAs ruling. They argue that NQFC, rather than meeting the issues, focused on its alleged ownership of Lot No. 102 and the
possession flowing out of its ownership. They deny ever meeting Santos and they maintain that their continued possession and occupation of Lot No. 102 belie this supposed sale.
Even granting that this sale occurred, Santos could still not have acquired any right over Lot No. 102 for as of 1980, it was still in the name of the Republic.27 Thus, they could not have
transferred ownership of Lot No. 102 to Santos, and he cannot claim ownership of Lot No. 102 by reason of this sale.28

On the other hand, the respondents open, continuous, exclusive, notorious and adverse possession of Lot No. 102 for three decades, coupled by a claim of ownership, gave them
vested right or interest over the property.29 This vested right is equivalent to an actually issued certificate of title so that the execution and delivery of the title is a mere formality. To say
the least, NQFC did not have to send them a formal demand to vacate30 and violently oust them from the premises had it been in actual possession of the property as claimed.31

Lastly, the respondents invoked the settled rule that the Courts jurisdiction in a Rule 45 petition is limited only to reviewing errors of law. NQFC failed to show misapprehension of facts
in the CAs findings to justify a departure from this rule.32

The Courts Ruling

We first address the procedural issue raised. Resolving the contentions raised necessarily requires us to delve into factual issues, a course not proper in a petition for review on
certiorari, for a Rule 45 petition resolves only questions of law, not questions of fact.33 This rule is read with the equally settled dictum that factual findings of the CA are generally
conclusive on the parties and are therefore not reviewable by this Court.34 By way of exception, we resolve factual issues when, as here, conflict attended the findings of the MTCC and
of the RTC, on one hand, and of the CA, on the other. Of minor note, but which we deem important to point, the petition needlessly impleaded the CA, in breach of Section 4, Rule 45 of
the Rules of Court.35

Substantively, the key issue this case presents is prior physical possession whether NQFC had been in prior physical possession of Lot No. 102.

We rule in the negative.

First, on the reliance on the BOL letters and Certification and the CAs alleged disregard of NQFCs evidence. To prove prior physical possession of Lot No. 102, NQFC presented the
Deed of Transfer, Santos OCT P-4035, the Deed of Absolute Sale, and the Order of the Bureau of Lands approving Santos free patent application. In presenting these pieces of
evidence, NQFC is apparently mistaken as it may have equated possession that is at issue as an attribute of ownership to actual possession. The latter type of possession is, however,
different from and has different legal implications than the former. While these documents may bear weight and are material in contests over ownership of Lot No. 102, they do not per
se show NQFCs actual possession of this property.

We agree that ownership carries the right of possession, but the possession contemplated by the concept of ownership is not exactly the same as the possession in issue in a forcible
entry case. Possession in forcible entry suits refers only to possession de facto, or actual or material possession, and not possession flowing out of ownership; these are different legal
concepts36 for which the law provides different remedies for recovery of possession.37 As we explained in Pajuyo v. Court of Appeals,38 and again in the more recent cases of

Gonzaga v. Court of Appeals,39 De Grano v. Lacaba,40 and Lagazo v. Soriano,41 the word "possession" in forcible entry suits refers to nothing more than prior physical possession or
possession de facto, not possession de jure42 or legal possession in the sense contemplated in civil law.43 Title is not the issue,44 and the absence of it "is not a ground for the courts
to withhold relief from the parties in an ejectment case."45

Thus, in a forcible entry case, "a party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the character of his possession,
if he has in his favor prior possession in time, he has the security that entitles him to remain on the property until a person with a better right lawfully ejects him."46He cannot be ejected
by force, violence or terror -- not even by its owners.47 For these reasons, an action for forcible entry is summary in nature aimed only at providing an expeditious means of protecting
actual possession.48Ejectment suits are intended to "prevent breach of x x x peace and criminal disorder and to compel the party out of possession to respect and resort to the law
alone to obtain what he claims is his."49 Thus, lest the purpose of these summary proceedings be defeated, any discussion or issue of ownership is avoided unless it is necessary to
resolve the issue of de facto possession.

We agree with the respondents that instead of squarely addressing the issue of possession and presenting evidence showing that NQFC or Santos had been in actual possession of
Lot No. 102, the former merely narrated how it acquired ownership of Lot No. 102 and presented documents to this effect. Its allegation that Santos occupied Lot No. 102 in 1972 is
uncorroborated. Even the tax declarations under Santos name are hardly of weight; "tax declarations and realty tax payments are not conclusive proof of possession. They are merely
good indicia of possession in the concept of owner"50 but not necessarily of the actual possession required in forcible entry cases.

Section 1, Rule 70 of the Rules of Court provides when an action for forcible entry, and unlawful detainer, is proper:

SECTION 1. Who may institute proceedings, and when. Subject to the provisions of the next succeeding section, a person deprived of the possession of any land or building by
force, intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person against whom the possession of any land or building is unlawfully withheld after the expiration
or termination of the right to hold possession, by virtue of any contract, express or implied, or the legal representatives or assigns of any such lessor, vendor, vendee, or other person
may at any time within one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper Municipal Trial Court against the person or persons
unlawfully withholding or depriving of possession, or any person or persons claiming under them, for the restitution of such possession, together with damages and costs. [emphasis
ours; italics supplied]

Under this provision, for a forcible entry suit to prosper, the plaintiff must allege and prove: (1) prior physical possession of the property; and (2) unlawful deprivation of it by the
defendant through force, intimidation, strategy, threat or stealth.51 As in any civil case, the burden of proof lies with the complainants (the respondents in this case) who must establish
their case by preponderance of evidence. In the present case, the respondents sufficiently alleged and proved the required elements.

To support its position, NQFC invokes the principle of tacking of possession, that is, when it bought Lot No. 102 from Santos on December 29, 2000, its possession is, by operation of
law, tacked to that of Santos and even earlier, or at the time Donato acquired Lot No. 102 in 1948.

NQFCs reliance on this principle is misplaced. True, the law52 allows a present possessor to tack his possession to that of his predecessor-in-interest to be deemed in possession of
the property for the period required by law. Possession in this regard, however, pertains to possession de jure and the tacking is made for the purpose of completing the time required
for acquiring or losing ownership through prescription. We reiterate possession in forcible entry suits refers to nothing more than physical possession, not legal possession.

The CA brushed aside NQFCs argument on the respondents failure to perfect their title over Lot No. 102. It held that the issue in this case is not of possession de jure, let alone
ownership or title, but of possession de facto.1wphi1 We agree with the CA; the discussions above are clear on this point.

We agree, too, as we have indicated in passing above, that the issue of ownership can be material and relevant in resolving the issue of possession. The Rules in fact expressly allow
this: Section 16, Rule 70 of the Rules of Court53provides that the issue of ownership shall be resolved in deciding the issue of possession if the question of possession is intertwined
with the issue of ownership. But this provision is only an exception and is allowed only in this limited instance-- to determine the issue of possession and only if the question of
possession cannot be resolved without deciding the issue of ownership.54 Save for this instance, evidence of ownership is not at all material, as in the present case.55

As a final reiterative note, this Decision deals only with de facto possession and is without prejudice to an appropriate action for recovery of possession based on ownership.

WHEREFORE, in light of these considerations, we hereby DENY the petition; the decision dated February 22, 2006 and the resolution dated July 13, 2006 of the Court of Appeals in
CA-G.R. SP No. 77006 are hereby AFFIRMED.

SO ORDERED.

42. G.R. No. 183035

January 9, 2013

OPTIMA REALTY CORPORATION, Petitioner,

vs.
HERTZ PHIL. EXCLUSIVE CARS, INC., Respondent.

DECISION

SERENO, CJ.:

Before us is a Rule 45 Petition assailing the Decision1 and Resolution2 of the Court of Appeals (CA) in CA-GR SP No. 99890, which reversed the Decision3 and Resolution4 of the
Regional Trial Court (RTC), Branch 13 7, Makati City in Civil Case No. 06-672. The RTC had affirmed in toto the 22 May 2006 Decision5 of the Metropolitan Trial Court (MeTC), Branch
64, Makati City in Civil Case No. 90842 evicting respondent Hertz Phil.

Exclusive Cars, Inc. (Hertz) and ordering it to pay back rentals and other arrearages to petitioner Optima Realty Corporation (Optima).

Optima is engaged in the business of leasing and renting out commercial spaces and buildings to its tenants. On 12 December 2002, it entered into a Contract of Lease with respondent
over a 131-square-meter office unit and a parking slot in the Optima Building for a period of three years commencing on 1 March 2003 and ending on 28 February 2006.6 On 9 March
2004, the parties amended their lease agreement by shortening the lease period to two years and five months, commencing on 1 October 2003 and ending on 28 February 2006.7

Renovations in the Optima Building commenced in January and ended in November 2005.8 As a result, Hertz alleged that it experienced a 50% drop in monthly sales and a significant
decrease in its personnels productivity. It then requested a 50% discount on its rent for the months of May, June, July and August 2005.9

On 8 December 2005, Optima granted the request of Hertz.10 However, the latter still failed to pay its rentals for the months of August to December of 2005 and January to February
2006,11 or a total of seven months. In addition, Hertz likewise failed to pay its utility bills for the months of November and December of 2005 and January and February of 2006,12 or a
total of four months.

On 8 December 2005, Optima wrote another letter to Hertz,13 reminding the latter that the Contract of Lease could be renewed only by a new negotiation between the parties and upon
written notice by the lessee to the lessor at least 90 days prior to the termination of the lease period.14 As no letter was received from Hertz regarding its intention to seek negotiation
and extension of the lease contract within the 90-day period, Optima informed it that the lease would expire on 28 February 2006 and would not be renewed.15

On 21 December 2005, Hertz wrote a letter belatedly advising Optima of the formers desire to negotiate and extend the lease.16 However, as the Contract of Lease provided that the
notice to negotiate its renewal must be given by the lessee at least 90 days prior to the expiration of the contract, petitioner no longer entertained respondents notice.

On 30 January 2006, Hertz filed a Complaint for Specific Performance, Injunction and Damages and/or Sum of Money with prayer for the issuance of a Temporary Restraining Order
(TRO) and Writ of Preliminary Injunction (Complaint for Specific Performance) against Optima. In that Complaint, Hertz prayed for the issuance of a TRO to enjoin petitioner from
committing acts that would tend to disrupt respondents peaceful use and possession of the leased premises; for a Writ of Preliminary Injunction ordering petitioner to reconnect its
utilities; for petitioner to be ordered to renegotiate a renewal of the Contract of Lease; and for actual, moral and exemplary damages, as well as attorneys fees and costs.

On 1 March 2006, Optima, through counsel, wrote Hertz a letter requiring the latter to surrender and vacate the leased premises in view of the expiration of the Contract of Lease on 28
February 2006.17 It likewise demanded payment of the sum of 420,967.28 in rental arrearages, unpaid utility bills and other charges.18 Hertz, however, refused to vacate the leased
premises.19 As a result, Optima was constrained to file before the MeTC a Complaint for Unlawful Detainer and Damages with Prayer for the Issuance of a TRO and/or Preliminary
Mandatory Injunction (Unlawful Detainer Complaint) against Hertz.20

On 14 March 2006, Summons for the Unlawful Detainer Complaint was served on Henry Bobiles, quality control supervisor of Hertz, who complied with the telephone instruction of
manager Rudy Tirador to receive the Summons.21

On 28 March 2006, or 14 days after service of the Summons, Hertz filed a Motion for Leave of Court to file Answer with Counterclaim and to Admit Answer with Counterclaim (Motion
for Leave to File Answer).22 In that Motion, Hertz stated that, "in spite of the defective service of summons, it opted to file the instant Answer with Counterclaim with Leave of

Court."23 In the same Motion, it likewise prayed that, in the interest of substantial justice, the Answer with Counterclaim attached to the Motion for Leave to File Answer should be
admitted regardless of its belated filing, since the service of summons was defective.24

On 22 May 2006, the MeTC rendered a Decision,25 ruling that petitioner Optima had established its right to evict Hertz from the subject premises due to nonpayment of rentals and the
expiration of the period of lease.26 The dispositive portion of the Decision reads:

WHEREFORE, premises considered, the Court hereby renders judgment for the plaintiff and against the defendant, ordering:

1. the defendant corporation and all persons claiming rights from it to immediately vacate the leased premises and to surrender possession thereof to the plaintiff;

2. the defendant corporation to pay the plaintiff the amount of Four Hundred Twenty Thousand Nine Hundred Sixty Seven Pesos and 28/100 (P420,967.28) representing
its rentals arrearages and utility charges for the period of August 2005 to February 2006, deducting therefrom defendants security deposit;

3. the defendant corporation to pay the amount of Fifty Four Thousand Two Hundred Pesos (P54,200.00) as a reasonable monthly compensation for the use and
occupancy of the premises starting from March 2006 until possession thereof is restored to the plaintiff; and

4. the defendant corporation to pay the amount of Thirty Thousand Pesos (P30,000.00) as and for attorneys fees; and

5. the cost of suit.

SO ORDERED.27

Hertz appealed the MeTCs Decision to the RTC.28

Finding no compelling reason to warrant the reversal of the MeTCs Decision, the RTC affirmed it by dismissing the appeal in a Decision29 dated 16 March 2007.

On 18 June 2007, the RTC denied respondents Motion for Reconsideration of its assailed Decision.30

Hertz thereafter filed a verified Rule 42 Petition for Review on Certiorari with the CA.31

On appeal, the CA ruled that, due to the improper service of summons, the MeTC failed to acquire jurisdiction over the person of respondent Hertz. The appellate court thereafter
reversed the RTC and remanded the case to the MeTC to ensure the proper service of summons. Accordingly, the CA issued its 17 March 2008 Decision, the fallo of which reads:

WHEREFORE, premises considered, the May 22, 2006 Decision of the Metropolitan Trial Court of Makati City, Branch 64, in Civil Case No. 90842, and both the March 16, 2007
Decision, as well as the June 18, 2007 Resolution, of the Regional Trial Court of Makati City, Branch 137, in Civil Case No. 06-672, are hereby REVERSED, ANNULLED and SET
ASIDE due to lack of jurisdiction over the person of the defendant corporation HERTZ. This case is hereby REMANDED to the Metropolitan Trial Court of Makati City, Branch 64, in
Civil Case No. 90842, which is DIRECTED to ensure that its Sheriff properly serve summons to only those persons listed in Sec. 11, Rule 14 of the Rules of Civil Procedure in order that
the MTC could acquire jurisdiction over the person of the defendant corporation HERTZ.

SO ORDERED.32

Petitioners Motion for Reconsideration of the CAs Decision was denied in a Resolution dated 20 May 2008.33

Aggrieved by the ruling of the appellate court, petitioner then filed the instant Rule 45 Petition for Review on Certiorari with this Court.34

THE ISSUES

As culled from the records, the following issues are submitted for resolution by this Court:

1. Whether the MeTC properly acquired jurisdiction over the person of respondent Hertz;

2. Whether the unlawful detainer case is barred by litis pendentia; and

3. Whether the ejectment of Hertz and the award of damages, attorneys fees and costs are proper.

THE COURTS RULING

We grant the Petition and reverse the assailed Decision and Resolution of the appellate court.

The MeTC acquired jurisdiction over the person of respondent Hertz.

In civil cases, jurisdiction over the person of the defendant may be acquired either by service of summons or by the defendants voluntary appearance in court and submission to its
authority.35

In this case, the MeTC acquired jurisdiction over the person of respondent Hertz by reason of the latters voluntary appearance in court.

In Philippine Commercial International Bank v. Spouses Dy,36 we had occasion to state:

Preliminarily, jurisdiction over the defendant in a civil case is acquired either by the coercive power of legal processes exerted over his person, or his voluntary appearance in court. As
a general proposition, one who seeks an affirmative relief is deemed to have submitted to the jurisdiction of the court. It is by reason of this rule that we have had occasion to declare
that the filing of motions to admit answer, for additional time to file answer, for reconsideration of a default judgment, and to lift order of default with motion for reconsideration, is
considered voluntary submission to the court's jurisdiction. This, however, is tempered by the concept of conditional appearance, such that a party who makes a special appearance to
challenge, among others, the court's jurisdiction over his person cannot be considered to have submitted to its authority.

Prescinding from the foregoing, it is thus clear that:

(1) Special appearance operates as an exception to the general rule on voluntary appearance;

(2) Accordingly, objections to the jurisdiction of the court over the person of the defendant must be explicitly made, i.e., set forth in an unequivocal manner; and

(3) Failure to do so constitutes voluntary submission to the jurisdiction of the court, especially in instances where a pleading or motion seeking affirmative relief is filed and
submitted to the court for resolution. (Emphases supplied)

In this case, the records show that the following statement appeared in respondents Motion for Leave to File Answer:

In spite of the defective service of summons, the defendant opted to file the instant Answer with Counterclaim with Leave of Court, upon inquiring from the office of the clerk of court of
this Honorable Court and due to its notice of hearing on March 29, 2005 application for TRO/Preliminary Mandatory Injunction was received on March 26, 2006. (Emphasis supplied)37

Furthermore, the Answer with Counterclaim filed by Hertz never raised the defense of improper service of summons. The defenses that it pleaded were limited to litis pendentia, pari
delicto, performance of its obligations and lack of cause of action.38 Finally, it even asserted its own counterclaim against Optima.39

Measured against the standards in Philippine Commercial International Bank, these actions lead to no other conclusion than that Hertz voluntarily appeared before the court a quo. We
therefore rule that, by virtue of the voluntary appearance of respondent Hertz before the MeTC, the trial court acquired jurisdiction over respondents.

II

The instant ejectment case is not barred by litis pendentia. Hertz contends that the instant case is barred by litis pendentia because of the pendency of its Complaint for Specific
Performance against Optima before the RTC.

We disagree.

Litis pendentia requires the concurrence of the following elements:

(1) Identity of parties, or at least their representation of the same interests in both actions;

(2) Identity of rights asserted and reliefs prayed for, the relief being founded on the same facts; and

(3) Identity with respect to the two preceding particulars in the two cases, such that any judgment that may be rendered in the pending case, regardless of which party is
successful, would amount to res judicata in the other case.40

Here, while there is identity of parties in both cases, we find that the rights asserted and the reliefs prayed for under the Complaint for Specific Performance and those under the present
Unlawful Detainer Complaint are different. As aptly found by the trial court:

The Complaint for Specific Performance] seeks to compel plaintiff-appellee Optima to: (1) renegotiate the contract of lease; (2) reconnect the utilities at the leased premises; and (3) pay
damages. On the other hand, the unlawful detainer case sought the ejectment of defendant-appellant Hertz from the leased premises and to collect arrears in rentals and utility bills.41

As the rights asserted and the reliefs sought in the two cases are different, we find that the pendency of the Complaint for Specific Performance is not a bar to the institution of the
present case for ejectment.

III

The eviction of respondent and the award of damages,

attorneys fees and costs were proper.

We find that the RTCs ruling upholding the ejectment of Hertz from the building premises was proper. First, respondent failed to pay rental arrearages and utility bills to Optima; and,
second, the Contract of Lease expired without any request from Hertz for a renegotiation thereof at least 90 days prior to its expiration.

On the first ground, the records show that Hertz failed to pay rental arrearages and utility bills to Optima. Failure to pay timely rentals and utility charges is an event of default under the
Contract of Lease,42 entitling the lessor to terminate the lease.

Moreover, the failure of Hertz to pay timely rentals and utility charges entitles the lessor to judicially eject it under the provisions of the Civil Code.43

On the second ground, the records likewise show that the lease had already expired on 28 February 2006 because of Hertzs failure to request a renegotiation at least 90 days prior to
the termination of the lease period.

The pertinent provision of the Contract of Lease reads:

x x x. The lease can be renewed only by a new negotiation between the parties upon written notice by the LESSEE to be given to the LESSOR at least 90 days prior to termination of
the above lease period.44

As the lease was set to expire on 28 February 2006, Hertz had until 30 November 2005 within which to express its interest in negotiating an extension of the lease with Optima.
However, Hertz failed to communicate its intention to negotiate for an extension of the lease within the time agreed upon by the parties. Thus, by its own provisions, the Contract of
Lease expired on 28 February 2006.1wphi1

Under the Civil Code, the expiry of the period agreed upon by the parties is likewise a ground for judicial ejectment.45

As to the award of monthly compensation, we find that Hertz should pay adequate compensation to Optima, since the former continued to occupy the leased premises even after the
expiration of the lease contract. As the lease price during the effectivity of the lease contract was P54,200 per month, we find it to be a reasonable award.

Finally, we uphold the award of attorney's fees in the amount of P30,000 and judicial costs in the light of Hertz's unjustifiable and unlawful retention of the leased premises, thus forcing
Optima to file the instant case in order to protect its rights and interest.

From the foregoing, we find that the MeTC committed no reversible error in its 22 May 2006 Decision, and that the RTC committed no reversible error either in affirming the MeTC's
Decision.

WHEREFORE, in view of the foregoing, the instant Rule 45 Petition for Review is GRANTED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 99890
are hereby REVERSED and SET ASIDE. The Decision of the Regional Trial Court, Branch 13 7, Makati City in Civil Case No. 06-672 affirming in toto the Decision of the Metropolitan
Trial Court, Branch 64, Makati City in Civil Case No. 90842 is hereby REINSTATED and AFFIRMED.

SO ORDERED.

43. G.R. No. 173987

February 25, 2012

PADILLA MERCADO, ZULUETA MERCADO, BONIFACIA MERCADO, DAMIAN MERCADO and EMMANUEL MERCADO BASCUG, Petitioners,
vs.
SPOUSES AGUEDO ESPINA and LOURDES ESPINA, Respondents.

DECISION

PERALTA, J.:

Assailed before the Court via a petiti_on for review on certiorari under Rule 45 of the Rules of Court are the Decision1 and Resolution,2 dated April 27, 2005 and July 12, 2006,
respectively, of the Court of Appeals (CA) in CA-G.R. SP No. 84537.

Subject of the instant controversy is a 338 square meter parcel of land located at the Poblacion of the then Municipality of Maasin (now a city), in the Province of Southern Leyte.

On May 8, 2000, herein petitioners filed with the Regional Trial Court (RTC) of Maasin, Southern Leyte, a Complaint for Recovery of Property and Declaration of Nullity of Deed of Sale,
Certificate of Title and Damages. The case was docketed as Civil Case No. R-3147.

Petitioners alleged in their Complaint that they are the heirs of the late spouses Santiago and Sofronia Mercado, who were the owners of the subject parcel of land; after the death of
Santiago and Sofronia, petitioners inherited the disputed lot, possessing the same as owners; sometime in 1996, herein respondents claimed ownership over the subject parcel of land,
alleging that they bought the same from one Josefa Mercado Espina (Josefa) who, in turn, previously bought the same in 1939 from a certain Genivera Mercado Kavanaugh; that
Genivera supposedly purchased the same property from one Escolastico Mercado in 1937 who, in turn, allegedly bought it from Santiago Mercado. Petitioners further alleged that in
1962, Josefa, through fraudulent machinations, was able to obtain a title (Original Certificate of Title No. 35) over the subject property in her name. Asserting that the above-mentioned
contracts of sale never happened, petitioners prayed for the declaration of nullity of the deeds of sale between Santiago and Escolastico, Escolastico and Genivera, and between
Genivera and Josefa. They prayed that the Transfer Certificate of Title (TCT) in the name of herein respondents be nullified and that petitioners be declared as the owners of the
disputed lot. They asked that the court award them actual, moral and exemplary damages, and attorney's fees.

On June 29, 2000, respondents filed a Motion to Dismiss on grounds that the RTC has no jurisdiction over the case due to the failure of the complainant to state the assessed value of
the property, that petitioners' cause of action is barred by prescription, laches and indefeasibility of title, and that the complaint does not state sufficient cause of action against
respondents who are buyers in good faith.3

The RTC denied respondents' Motion to Dismiss. Respondents then filed a motion for reconsideration, but the same was denied by the RTC.

Respondents then filed a special civil action for certiorari with the CA assailing the above orders of the RTC.

In its Resolution4 dated March 13, 2001, the CA denied due course and dismissed respondents' petition forcertiorari. Respondents filed a motion for reconsideration, but the same was
denied by the CA in its Resolution dated October 21, 2003.

Meanwhile, on August 17, 2000, petitioners, by leave of court, filed an Amended Complaint to include the assessed value of the subject property.5

On November 21, 2003, respondents filed a Motion to Dismiss Amended Complaint on grounds of prescription, laches, indefeasibility of title and lack of cause of action.6

On February 18, 2004, the RTC issued an Order7 denying respondents' Motion to Dismiss Amended Complaint. Respondents filed a motion for reconsideration, but the RTC denied it
in its Order dated April 19, 2004.8

Respondents filed a special civil action for certiorari with the CA praying that the February 18, 2004 and April 19, 2004 Orders of the RTC be set aside and petitioners' complaint
dismissed.

On April 27, 2005, the CA promulgated its assailed Decision, the dispositive portion of which reads as follows:

WHEREFORE, the petition is granted. The assailed orders of the Regional Trial Court dated February 18, 2004 and April 19, 2004 must be as they are hereby, SET ASIDE. The
COMPLAINT in Civil Case No. R-3147 is DISMISSED. The Regional Trial Court of Maasin City, Branch 25 is hereby enjoined from proceeding with the case. No pronouncement as to
costs.

SO ORDERED.9

The CA ruled that respondents' title has become indefeasible and incontrovertible by lapse of time and that petitioners' action is already barred by prescription. The CA also held that
since petitioners did not allege that respondents were not buyers in good faith, the latter are presumed to be purchasers in good faith and for value.

Petitioners filed a motion for reconsideration, but the CA denied it in its Resolution10 dated July 12, 2006.

Hence, the instant petition for review on certiorari raising the following issues:

1) Procedurally, whether or not the Court of Appeals erred in giving due course to respondents second motion to dismiss filed on November 21, 2003 on the amended
complaint filed on August 16, 2000;

2) Substantively, whether or not the Court of Appeals erred in ordering the Regional Trial Court to dismiss the case and enjoining it from proceeding with the case on the
ground of indefeasibility of title, prescription and/or laches.11

On the first issue, petitioners contend that respondents' Motion to Dismiss Amended Complaint was filed beyond the period allowed by the Rules of Court. Petitioners also aver that the
above Motion to Dismiss Amended Complaint is a circumvention of the Rules of Court, because the matters raised therein are mere reiterations of their first motion to dismiss, which
was dismissed by the RTC and, on petition for certiorari, was denied due course by the CA.

Anent the second issue, petitioners argue that respondents' ground of indefeasibility of title in their Motion to Dismiss Amended Complaint is not an authorized ground under Rule 16 of
the Rules of Court. Petitioners also assert that the other grounds, i.e., good faith, lack of cause of action and prescription, raised by respondents in their motion are not supported by
evidence.

The petition lacks merit.

As to the first issue, there is no dispute that the issue of timeliness of respondents' Motion to Dismiss petitioners' Amended Complaint was not raised by petitioners before the RTC.
Neither was this issue raised in their Comment to respondents' petition for certiorari filed with the CA. It was only in their Motion for Reconsideration of the CA Decision that this matter
was raised. It is well established that issues raised for the first time on appeal and not raised in the proceedings in the lower court are barred by estoppel.12 Points of law, theories,
issues, and arguments not brought to the attention of the trial court ought not to be considered by a reviewing court, as these cannot be raised for the first time on appeal.13 Basic
considerations of due process impel the adoption of this rule.14

Moreover, respondent's filing of their Motion to Dismiss Amended Complaint may not be considered as a circumvention of the rules of procedure. Under Section 8, Rule 10 of the Rules
of Court, an amended complaint supersedes an original one. As a consequence, the original complaint is deemed withdrawn and no longer considered part of the record.15 In the
present case, the Amended Complaint is, thus, treated as an entirely new complaint. As such, respondents had every right to move for the dismissal of the said Amended Complaint.
Were it not for the filing of the said Motion, respondents would not have been able to file a petition for certiorari before the CA which, in turn, rendered the presently assailed judgment in
their favor.

With respect to the second issue, the CA correctly ruled that petitioners' Amended Complaint failed to state a cause of action. The Court quotes with approval the following disquisition
of the appellate court, to wit:

xxxx

With particular reference to the petitioners [herein respondents], We observed that there is no allegation at all in respondents' [herein petitioners'] complaint that they [respondents] are
buyers or transferees in bad faith or with notice of the alleged defect in the title of their vendor/s with the result that the allegations of said pleading are not sufficient to constitute a
cause of action.

While private respondents [petitioners] accused Escolastico Mercado of fraudulent conduct, due to the alleged dubious character of the document of sale which passed the ownership of
Santiago's property to him and that the signature of Santiago was not authentic, there is no allegation whatsoever as to the fraudulent nature of the succeeding transfers or of
the succeeding transferee's knowledge about the irregularity and defect of the first sale. Most importantly, the complaint contains no averment that herein petitioners
[respondents] had any knowledge, much less any participation, voluntarily or otherwise, in the alleged irregularity or anomaly of the original sale transaction between
Santiago and Escolastico Mercado or in the acquisition/issuance of the OCT No. 35. Neither was there any allegation in the complaint attributing petitioners [respondents]
with negligence. Petitioners [Respondents] cannot also be presumed to be negligent. On the contrary, the revised rules of court provides a disputable presumption in Petitioners
[respondents'] favor to the effect "that a person takes ordinary care of his concerns["] and that ["]private transactions have been fair and regular.["] The allegations of the complaint
would even lend a conclusion that there is nothing questionable as to the way petitioners[respondents] obtained their title over the property. This is where We denounce the court a
quo's act of entertaining evidencealiunde and supplying the missing facts which should have been alleged to constitute a cause of action.

We have carefully perused the complaint and We find that it is devoid of the following allegations: 1) that Josefa is the mother of petitioners [respondents]; 2) that Genivera
Mercado Kavanaugh is an American citizen, and 3) that, petitioners [respondents] are not buyers in good faith. Hence, the court a quo clearly committed grave abuse of
discretion, when, in denying the motion to dismiss, he made some findings "that petitioners [respondents] are not buyers in good faith because all along they know or they
ought to know that the land does not belong to their mother Josefa Espina, and that their mother could not have legally acquired the same from her sister Genivera
Kavanaugh, an American citizen who cannot acquire land except by way of hereditary succession." It has been held time and again that "to determine the sufficiency of the
cause of action, the respondent court can only consider facts alleged in the complaint which are deemed hypothetically admitted by defendants and no other
allegations should be considered."

Where the complaint for recovery of ownership and possession of a parcel of land (such as the one at bar) alleges that some of the defendants bought said land from their
co-defendants who had a defective title thereto but does not allege that the purchasers were purchasers in bad faith or with notice of the defect in the title of their
vendors, it is held that the lower court correctly dismissed the complaint against the purchasers for failure to state a cause of action against them.

x x x x16 (Emphasis supplied)

Failure to state a cause of action refers to the insufficiency of the pleading, and is a ground for dismissal under Rule 16 of the Rules of Court.17

A complaint states a cause of action if it avers the existence of the three essential elements of a cause of action, namely:

(a) The legal right of the plaintiff;

(b) The correlative obligation of the defendant; and

(c) The act or omission of the defendant in violation of said legal right.18

If the allegations in the complaint do not aver the concurrence of these elements, the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of
action.19 A perusal of the Amended Complaint in the present case would show that there is, indeed, no allegation of any act or omission on the part of respondents which supposedly
violated the legal rights of petitioners. Thus, the CA is correct in dismissing the complaint on the ground of failure to state a cause of action.

Apropos to the foregoing, it bears to note at this stage that the Court likewise agrees with the ruling of the CA that respondents are presumed purchasers in good faith.1wphi1 In
holding thus, the CA relied on the settled principle that one who deals with property registered under the Torrens System need not go beyond the same, but only has to rely on the
title.20 In the instant case, there is no dispute that the subject property was already covered by a Torrens title when respondents bought the same. There was no allegation in the
Amended Complaint that respondents were not buyers in good faith. More particularly, there was nothing in the said complaint to indicate that respondents were aware of or were
participants in the alleged fraud supposedly committed against petitioners' predecessor-in-interest, or that they have notice of any defect in the title of the seller. As the CA correctly
noted, from the time that petitioners' predecessor-in-interest was supposedly deprived of ownership of the subject Jot through an alleged fraudulent sale, the same had already been
sold thrice. Moreover, since the subject property was already covered by a Torrens title at the time that respondents bought the same, the law does not require them to go beyond what
appears on the face of the title. The lot has, thus, passed to respondents, who are presumed innocent purchasers for value, in the absence of any allegation to the contrary.

Paragraph 3, Section 53 ofPresidential Decree No. 1529 provides:

In all cases of registration procured by fraud, the owner may pursue all his legal and equitable remedies against the parties to such fraud without prejudice, however, to the rights of any
i1moccnt holder for value of a certificate of title. x x x

Petitioners' cause of action should, therefore, be directed not against respondents, who are innocent holders for value, but against those whom petitioners alleged to have defrauded
them.

Based on the above discussions, the Court no longer finds any need to resolve the other issues raised in the instant petition.

WHEREFORE, the petition for review on certiorari is DENIED. The April 27, 2005 Decision and July 12, 2006 Resolution of the Court of Appeals in CA-G.R. SP No. 84537
are AFFIRMED.

SO ORDERED.

44. G.R. No. 173166

March 13, 2013

PURIFICACION ESTANISLAO and RUPERTO ESTANISLAO, Petitioners,

vs.
SPOUSES NORMA GUDITO and DAMIANO GUDITO, Respondents.

DECISION

PERALTA, J.:

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court which seeks the reversal of the Decision1 dated October 25, 2005, and Resolution2 dated June 16,
2006 of the Court of Appeals (CA) in CA-G.R. SP No. 46323.

The factual antecedents are as follows:

Respondents are the owners of a residential lot being leased by petitioners on a month-to-month basis. Petitioners had been renting and occupying the subject lot since 1934 and were
the ones who built the house on the subject lot in accordance with their lease agreement with one Gaspar Vasquez. When Gaspar Vasquez died, the portion of the lot on which
petitioners house was erected was inherited by his son Victorino Vasquez, married to Ester Vasquez (Vasquez couple).

In the 1980s, the Vasquez couple wanted the Estanislao family and the other tenants to vacate the said property, but the tenants refused because of laws allegedly prohibiting their
ejectment therefrom. Resultantly, the Vasquez couple refused to accept their rental payments. Thus, petitioner Purificacion Estanislao, with due notice to Ester Vasquez, deposited the
amount of her monthly rentals at Allied Banking Corporation under a savings account in the name of Ester Vasquez as lessor.

In the interim, a Deed of Donation was executed by the Vasquez couple in favor of respondent Norma Vasquez Gudito. Hence, in October 1994, respondents notified petitioners to
remove their house and vacate the premises within three months or up to January 31, 1995, because of their urgent need of the residential lot. In a letter dated March 5, 1995,
respondents reiterated the demand and gave petitioners another three months or up to June 30, 1995, within which to remove their house, vacate the subject lot and pay the rental
arrearages. However, petitioners failed to comply.

Accordingly, on November 10, 1995, respondents filed a Complaint for Unlawful Detainer/Ejectment against petitioners before the Metropolitan Trial Court (MeTC) of Manila.

On March 6, 1996, the MeTC of Manila rendered a Decision3 in favor of respondents, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the defendants ordering:

(1) The defendants and all persons claiming rights under them to immediately vacate the subject premises known as 2351 Pasig Line, Sta. Ana, Manila, and surrender its
peaceful possession to the plaintiffs;

(2) The defendants to pay reasonable compensation for the use and occupancy of the subject premises in the amount of P500.00 a month beginning October 1985 and
every month thereafter until they shall have finally and actually vacated the subject premises;

(3) To pay the plaintiffs the sum of P5,000.00 for and as attorneys fees;

(4) To pay the costs of suit.

SO ORDERED.4

Thereafter, petitioners elevated the case before the Regional Trial Court (RTC) of Manila.

On November 28, 1997, the RTC of Manila rendered a Decision5 reversing the MeTCs decision. The fallo states:

WHEREFORE, premises considered, the Decision dated March 6, 1996 rendered by the court a quo is hereby REVERSED and SET ASIDE and a new judgment is hereby rendered as
follows:

(1) The instant complaint filed by the Guditos is hereby DISMISSED;

(2) The "Guditos" are hereby enjoined to respect the lease agreement as well as the possession of the "Estanislaos" over the leased premises. Should the "Guditos"
decide to sell or otherwise dispose of the same property to third parties, the "Estanislaos" are given the right of first refusal pursuant to PDs 1517 and 2018 or; should the
"Guditos" need the same property for residential purposes, they can avail of the remaining 205.50 square meters of the same lot wherein they can build their house.

(3) The present monthly rental is hereby fixed at P500 per month;

(4) Attorneys fees at P20,000 plus the cost of suit; and

(5) Other claims and counter-claims are hereby dismissed for lack of merit.

SO ORDERED.6

Dissatisfied, respondents interposed an appeal before the CA.

In a Decision7 dated October 25, 2005, the CA annulled and set aside the RTCs decision and reinstated the MeTCs decision. It held as follows:

WHEREFORE, the Decision of Branch 47 of the Regional Trial Court of Manila, in Civil Case No. 96-77804 dated November 28, 1998 is hereby ANNULLED and SET ASIDE.
Consequently, the Decision of Branch 11 of the Metropolitan Trial Court of Manila in Civil Case No. 149805-CV dated March 6, 1996 is hereby REINSTATED with the MODIFICATION
that the respondents are ordered to pay reasonable compensation for the use and occupancy of the subject premises in the amount of Five Hundred Pesos a month beginning
November 1995, and every month thereafter until they have finally vacated the subject premises.

SO ORDERED.8

Hence, petitioners filed the instant petition raising the following issues for our resolution:

1. Whether or not the assailed decision of the Court of Appeals violates Presidential Decree No. 2016, in relation to Presidential Decree No. 1517, expressly prohibiting
the eviction of legitimate tenants from land proclaimed as Areas for Priority Development or as Urban Land Reform Zones.

2. Whether or not Batas Pambansa Blg. 877, relied upon by the Court of Appeals in its decision, can prevail over P.D. 2016, in relation to P.D. No. 1517, a special law and
a later enactment, considering that P.D. No. 2016 expressly repeals, amends or modifies accordingly any law inconsistent with it.

3. Whether or not a legitimate tenant covered by P.D. Nos. 1517 and 2016 can be evicted if the owner of the leased land does not intend to sell his property as
affirmatively held by the Court of Appeals.

4. Whether or not respondents as lessors can adequately use the leased lot for the alleged personal need without ejecting petitioners who occupy only a very small
portion thereof.

5. Whether or not the donation of the leased lot to respondents can defeat petitioners protected right under P.D. Nos. 1517 and 2016.9

The pertinent issue in this case is who has the better right of possession over the subject property.

Petitioners strongly argue that respondents cannot evict them from the subject property pursuant to Presidential Decree (P.D.) 1517, in relation to P.D. 2016, as the subject property is
allegedly within one of the 245 Proclaimed Area for Priority Development and/or Urban Land Reform No. 1967, as amended by Presidential Proclamation No. 2284. Petitioners further

contend that they were not aware that the subject property had been acquired by respondents via a Deed of Donation executed by the Vasquez couple. Thus, they assail that said
donation was merely simulated in order to deprive them of their right of first refusal to buy the subject property.

Conversely, respondents maintain P.D. 1517 cannot be appropriately applied to the present case, since the same applies only to a case where the owners intend to sell the property to
a third party. They argue that in the instant case they are seeking the eviction of petitioners solely on the ground that they need the property for residential purposes. Lastly, they assert
that they have sufficiently established a better right of possession over the disputed property than the petitioners.

We deny the petition.

To begin with, the only question that the courts must resolve in an unlawful detainer or ejectment suit is who between the parties is entitled to the physical or material possession of
the property in dispute.10

In the case under review, respondents have overwhelmingly established their right of possession by virtue of the Deed of Donation made in their favor. Moreover, they have complied
with the provisions of the law in order for them to legally eject the petitioners. Section 5 (c) of Batas Pambansa Blg. 25 states:

Sec. 5. Grounds for judicial ejectment. Ejectment shall be allowed on the following grounds:

xxxx

(c) Legitimate need of owner/ lessor to repossess his property for his own use or for the use of any immediate member of his family as a residential unit, such owner or immediate
member not being the owner of any other available residential unit within the same city or municipality: Provided, however, that the lease for a definite period has expired: Provided,
further, that the lessor has given the lessee formal notice within three (3) months in advance of the lessors intention to repossess the property: Provided, finally, that the owner/ lessor is
prohibited from leasing the residential unit or allowing its use by a third party for at least one year.

Here, it is undisputed that respondents do not own any other lot or real property except the herein subject lot. They have urgent need of the same to build their own house to be used as
their residence. Also, petitioners had already been asked to leave the premises as early as 1982, but sternly refused, hence, its former owners refused to accept their rental payments.
When the same property was donated to respondents, petitioners were allowed to continue occupying the subject lot since respondents did not as yet have the money to build a house
of their own.1avvphi1 But now that respondents have sufficient money to build their own house, petitioners still rebuff respondents demand to vacate the premises and to remove or
demolish their house. Clearly, since respondents have complied with the requirements of the law, their right to possess the subject property for their own use as family residence cannot
be denied.

It is also worthy to note that petitioners have failed to prove that the transfer of the subject property was merely a ploy designed to defeat and circumvent their right of first refusal under
the law. As emphasized by the CA, the Deed of Donation executed in favor of respondents was signed by the parties and their witnesses, and was even notarized by a notary public.

Veritably, it is a settled rule in our jurisdiction that a notarized document has in its favor the presumption of regularity and it carries the evidentiary weight conferred upon it with respect
to its due execution. It is admissible in evidence and is entitled to full faith and credit upon its face.11

Having been prepared and acknowledged before a notary public, the said Deed is vested with public interest, the sanctity of which deserves to be upheld unless overwhelmed by clear
and convincing evidence.12 Thus, the donation made by the Vasquez couple is a valid exercise of their right as owners of the subject property and respondents are legally entitled to
the said property as donees.

By the same token, this Court is not persuaded with petitioners insistence that they cannot be evicted in view of Section 6 of P.D. 1517, which states

SECTION 6. Land Tenancy in Urban Land Reform Areas. Within the Urban Zones legitimate tenants who have resided on the land for ten years or more who have built their homes
on the land and residents who have legally occupied the lands by contract, continuously for the last ten years shall not be dispossessed of the land and shall be allowed the right of first
refusal to purchase the same within a reasonable time and at reasonable prices, under terms and conditions to be determined by the Urban Zone Expropriation and Land Management
Committee created by Section 8 of this Decree. (Emphasis and underscoring supplied)

As can be gleaned from the foregoing, petitioners cannot use P.D. 1517 as a shield to deny respondents of their inherent right to possess the subject property. The CA correctly opined
that "under P.D. 1517, in relation to P.D. 2016, the lessee is given the right of first refusal over the land they have leased and occupied for more than ten yean and on which they
constructed their houses. But the right of first refusal applies only to a case where the owner of the property intends to sell it to a third party. If the owner of the leased premises do not
intend to sell the property in question but seeks to eject the tenant on the ground that the former needs the premises for residential purposes, the tenant cannot invoke the land reform
law."13

Clearly, the circumstances required for the application of P.D. 1517 are lacking in this case, since respondents had no intention of selling the subject property to third parties, but seek
the eviction of petitioners on the valid ground that they need the property for residential purposes.

WHEREFORE, premises considered, the Decision dated October 25, 2005, and Resolution dated June 16, 2006 of the Court of Appeals in CA-G.R. SP No. 46323 are hereby
AFFIRMED.

SO ORDERED.

45. G.R. No. 180463

January 16, 2013

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
AFP RETIREMENT AND SEPARATION BENEFITS SYSTEM,* Respondent,
HEIRS OF CABALO KUSOP and ATTY. NILO J. FLAVIANO, Respondents-Intervenors.

DECISION

DEL CASTILLO, J.:

The processes of the State should not be trifled with. The failure of a party to avail of the proper remedy to acquire or perfect one's title to land cannot justify a resort to other remedies
which are otherwise improper and do not provide for the full oppot1unity to prove his title, but instead require him to concede it before availment.

Certificates of title issued covering inalienable and non-disposable public land, even in the hands of an alleged innocent purchaser for value, should be cancelled.

Before us is a Petition for Review on Certiorari1 questioning the October 26, 2007 Decision2 of the Court of Appeals (CA) in CA-G.R. CV No. 75170, which reversed the November 5,
2001 Decision3 of the Regional Trial Court (RTC), Branch 23 of General Santos City in Civil Case No. 6419.

Factual Antecedents

Lots X, Y-1 and Y-2 lands of the public domain consisting of 52,678 square meters located in Barrio Dadiangas, General Santos Municipality (now General Santos City) were
reserved for recreation and health purposes by virtue of Proclamation No. 1684 (Proc. 168), which was issued in 1963. In 1983, Proclamation No. 22735 (Proc. 2273) was issued
amending Proc. 168, and removing and segregating Lots Y-1 and Y-2 from the reservation and declaring them open for disposition to qualified applicants. As a result, only Lot X
which consists of 15,020 square meters remained part of the reservation now known as Magsaysay Park.

The record discloses that respondents-intervenors waged a campaign through petitions and pleas made to the President to have Lots Y-1 and Y-2 taken out of the reservation for
the reason that through their predecessor Cabalo Kusop (Kusop), they have acquired vested private rights over these lots. This campaign resulted in Proc. 2273, which re-classified and
returned Lots Y-1 and Y-2 to their original alienable and disposable state.

In 1997, respondents-intervenors filed applications6 for the issuance of individual miscellaneous sales patents over the whole of Lot X with the Department of Environment and Natural
Resources (DENR) regional office in General Santos City, which approved them. Consequently, 16 original certificates of title7 (OCTs) covering Lot X were issued in the names of
respondents-intervenors and several others. In September 1997, these 16 titles were simultaneously conveyed8 to herein respondent AFP-Retirement and Separation Benefits System
(AFP-RSBS), resulting in the issuance of 16 new titles (the AFP-RSBS titles) Transfer Certificates of Title (TCT) No. T-81051 through T-81062, T-81146-T-81147, and T-81150-T81151.9

On September 11, 1998, herein petitioner Republic of the Philippines instituted Civil Case No. 6419, which is a Complaint10 for reversion, cancellation and annulment of the AFP-RSBS
titles, on the thesis that they were issued over a public park which is classified as inalienable and non-disposable public land.

Respondents-intervenors intervened11 in Civil Case No. 6419, and, together with the defendant AFP-RSBS, argued that their predecessor-in-interest Kusop had acquired vested
interests over Lot X even before Proc. 168 was issued, having occupied the same for more than 30 years. They claimed that these vested rights, taken together with the favorable
recommendations and actions of the DENR and other government agencies to the effect that Lot X was alienable and disposable land of the public domain, as well as the subsequent
issuance of sales patents and OCTs in their names, cannot be defeated by Proc. 168. They added that under Proc. 168, private rights are precisely recognized, as shown by the
preliminary paragraph thereof which states:

Upon the recommendation of the Secretary of Agriculture and Natural Resources and pursuant to the authority vested in me by law, I, Diosdado Macapagal, President x x x, do hereby
withdraw from sale or settlement and reserve for recreational and health resort site purposes, under the administration of the municipality of General Santos, subject to private rights, if
any there be x x x12 (Emphasis supplied.)

Ruling of the Regional Trial Court

On November 5, 2001, the trial court rendered judgment nullifying the AFP-RSBS titles and ordering the return of Lot X to the Republic, with the corresponding issuance of new titles in
its name. The trial court ruled that the respondents-intervenors having benefited by the grant, through Proc. 2273, of Lots Y-1 and Y-2 to them can no longer claim Lot X, which has
been specifically declared as a park reservation under Proc. 168 and further segregated under Proc. 2273. In other words, their private rights, which were guaranteed under Proc. 168,
have already been recognized and respected through the subsequently issued Proc. 2273; as a consequence, the succeeding sales patents and OCTs in the names of the
respondents-intervenors should be declared null and void not only for being in violation of law, but also because respondents-intervenors did not deserve to acquire more land.

Ruling of the Court of Appeals

The CA reduced the issues for resolution to just two: 1) whether the respondents-intervenors acquired vested rights over Lot X, and 2) whether AFP-RSBS is a buyer in good faith.13 It
went on to declare that Lot X was alienable and disposable land, and that respondents-intervenors predecessor-in-interest acquired title by prescription, on the basis of the
documentary evidence presented:

1. Report to the President of the Republic dated August 2, 1982 by the Board of Liquidators, recommending the amendment of Proc. 168 to recognize and respect the
rights of respondents-intervenors predecessors-in-interest, who have been in possession of portions of the reservation since time immemorial;14

2. Report of District Land Officer Buenaventura Gonzales of the Bureau of Lands, dated May 26, 1975, likewise stating that respondents-intervenors predecessors-ininterest have been in possession of portions of the reservation since time immemorial, and that for this reason, Proc. 168 was never in force and effect;15

3. Report of Deputy Public Land Inspector Jose Balanza of the Bureau of Lands, dated May 6, 1976, finding that the property covered by Proc. 168 is private property and
within an area declared as alienable and disposable under Project No. 47 per L.C. Map No. 700 established by the then Bureau of Forestry;16

4. Tax Declaration No. 716 in the name of Cabalo Kusop and its subsequent revisions;17

5. Certifications issued by the (then) municipal treasurer of General Santos and official receipts showing payment of taxes from 1945-1972;18

6. Sworn declaration of ownership submitted to the Philippine Constabulary;19

7. 1975 letter of then General Santos Mayor acknowledging that Kusop was in possession of Lot X even before the war; and20

8. Statements and testimonies of several witnesses.21

The CA added that as a consequence of their predecessors possession of Lot X since time immemorial, respondents-intervenors have acquired title without need of judicial or other
action, and the property ceased to be public land and thus became private property.22 It stressed that while "government has the right to classify portions of public land, the primary
right of a private individual who possessed and cultivated the land in good faith much prior to such classification must be recognized and should not be prejudiced by after-events which
could not have been anticipated."23

The CA went on to justify that the reason why Proc. 2273 did not take Lot X out of the public domain is not because the Executive wanted it to remain a recreational park reserve but
because the respondents-intervenors were in the process of donating said Lot X to General Santos City, and the President deemed it unnecessary to still place it within the coverage of
Proc. 2273.

The CA further ruled that the miscellaneous sales patents issued in the names of the respondents-intervenors affirm their claim of ownership over Lot X, while the OCTs subsequently
issued in their names rendered their claim indefeasible.

Finally, the appellate court declared that since respondents-intervenors titles to Lot X were duly obtained, the sale and transfer thereof to respondent AFP-RSBS should be accorded
the same treatment as a sale or transfer made to a purchaser in good faith. Besides, it having been shown that the petitioner is not entitled to Lot X since it already belonged to the
respondents-intervenors, petitioner had no right to raise the issue of AFP-RSBS good or bad faith.

Thus, petitioners Complaint for reversion was dismissed.

Issues

The petition now enumerates the following issues for resolution:

BY APPLYING FOR MISCELLANEOUS SALES PATENT, THE HEIRS HAVE ADMITTED THAT LOT X IS PUBLIC LAND. THE EVIDENCE THEY SUBMITTED TO
ESTABLISH THEIR ALLEGED PRIVATE OWNERSHIP IS THEREFORE UNAVAILING.

II

THE ALLEGED "VESTED RIGHTS" OF THE HEIRS OVER LOT X CANNOT PREVAIL AGAINST GOVERNMENT OWNERSHIP OF PUBLIC LAND UNDER THE
REGALIAN DOCTRINE.

III

THERE IS NO BASIS TO CONCLUDE THAT PROCLAMATION 2273 RECOGNIZED THE OWNERSHIP OF LOT X BY THE HEIRS. NEITHER IS THERE BASIS TO
CLAIM THAT THE HEIRS RETAINED OWNERSHIP OF LOT X DUE TO THE FAILURE OF THE CITY OF GENERAL SANTOS TO ACCEPT THE DONATION OF LOT
X.

IV

AFP-RSBS IS NOT A BUYER IN GOOD FAITH.24

Petitioners Arguments

Apart from echoing the pronouncements of the trial court, the Republic, in its Petition and Consolidated Reply,25submits that respondents-intervenors applications for miscellaneous
sales patents constitute acknowledgment of the fact that Lot X was public land, and not private property acquired by prescription.

Petitioner argues further that with the express recognition that Lot X is public land, it became incumbent upon respondents-intervenors granting that they are entitled to the issuance of
miscellaneous sales patents to prove that Lot X is alienable and disposable land pursuant to Commonwealth Act No. 14126 (CA 141); and that in this regard respondents-intervenors
failed. They offered proof, in the form of reports and recommendations made by the Bureau of Lands and the Board of Liquidators, among others, which were insufficient to establish
that Lot X was alienable and disposable land of the public domain. Besides, under the law governing miscellaneous sales patents, Republic Act No. 73027 (RA 730), it is specifically
required that the property covered by the application should be one that is not being used for a public purpose. Yet the fact remains that Lot X is being utilized as a public recreational
park. This being the case, Lot X should not have qualified for distribution allowable under RA 730.

Petitioner next insists that if indeed respondents-intervenors have become the owners of Lot X by acquisitive prescription, they should have long availed of the proper remedy or
remedies to perfect their title through an action for confirmation of imperfect title or original registration. Yet they did not; instead, they resorted to an application for issuance of
miscellaneous sales patents. By so doing, respondents-intervenors conceded that they had not acquired title to Lot X.

Petitioner next advances the view that respondents-intervenors vested rights cannot prevail as against the States right to Lot X under the Regalian doctrine. Petitioner argues that the
presumption still weighs heavily in favor of state ownership of all lands not otherwise declared private and that since Lot X was not declared open for disposition as were Lots Y-1 and
Y-2 by and under Proc. 2273, it should properly retain its character as an inalienable public recreational park.

Finally, petitioner submits that the good or bad faith of AFP-RSBS is irrelevant because any title issued on inalienable public land is void even in the hands of an innocent purchaser for
value.28

Respondents Arguments

AFP-RSBS and the respondents-intervenors collectively argue that the grounds relied upon by the Republic in the petition involve questions of fact, which the Court may not pass upon.
They add that since private rights are explicitly recognized under Proc. 168, the respondents-intervenors predecessors prior possession since time immemorial over Lot X should thus
be respected and should bestow title upon respondents-intervenors.

They argue that if respondents-intervenors chose the wrong remedy in their attempt to perfect their title over Lot X, this was an innocent mistake that in no way divests such title, which
was already perfected and acquired by virtue of their predecessors open, continuous and uninterrupted possession of Lot X.

Finally, they argue that the reports and recommendations of the Bureau of Lands and the Board of Liquidators constitute findings of facts of administrative agencies which thus bind the
Court. They add that the presumption arising from the Regalian doctrine may be overcome by proof to the contrary, and that it has in fact been overcome by the evidence presented
before the trial court.

Our Ruling

The Court grants the Petition.

From the wording of Proc. 168, the land it comprises is subject to sale or settlement, and thus alienable and disposable Upon the recommendation of the Secretary of Agriculture and
Natural

Resources and pursuant to the authority vested in me by law, I, Diosdado Macapagal, President x x x, do hereby withdraw from sale or settlement and reserve for recreational and
health resort site purposes, under the administration of the municipality of General Santos, subject to private rights, if any there be x x x29 (Emphasis and underscoring supplied.)

However, this alienable and disposable character of the land covered by the proclamation was subsequently withdrawn, and the land was re-classified by then President Macapagal to
pave the way for the establishment of a park reservation, subject only to previously acquired private rights. Respondents-intervenors then lobbied for the exclusion of certain portions of
the reservation which they claimed to be theirs, allegedly acquired by their predecessor Kusop through prescription. They were successful, for in 1983, then President Marcos issued
Proc. 2273, which excluded and segregated Lots Y-1 and Y-2 from the coverage of Proc. 168. In addition, Proc. 2273 declared Lots Y-1 and Y-2 open for distribution to qualified
beneficiaries which included the herein respondents-intervenors. However, Lot X was retained as part of the reservation.

Respondents-intervenors did not question Proc. 2273, precisely because they were the beneficiaries thereof; nor did they object to the retention of Lot X as part of the park reserve.
Instead, in 1997, they applied for, and were granted, sales patents over Lot X.

Evidently, the sales patents over Lot X are null and void, for at the time the sales patents were applied for and granted, the land had lost its alienable and disposable character. It was
set aside and was being utilized for a public purpose, that is, as a recreational park. Under Section 83 of CA 141, "the President may designate by proclamation any tract or tracts of
land of the public domain as reservations for the use of the Commonwealth of the Philippines or of any of its branches, or of the inhabitants thereof, in accordance with regulations
prescribed for this purpose, or for quasi-public uses or purposes, when the public interest requires it, including reservations for highways, rights of way for railroads, hydraulic power
sites, irrigation systems, communal pastures or leguas comunales, public parks, public quarries, public fishponds, workingmen's village and other improvements for the public benefit."
And under the present Constitution, national parks are declared part of the public domain, and shall be conserved and may not be increased nor diminished, except by law.30

The 1935 Constitution classified lands of the public domain into agricultural, forest or timber. Meanwhile, the 1973 Constitution provided the following divisions: agricultural, industrial or
commercial, residential, resettlement, mineral, timber or forest and grazing lands, and such other classes as may be provided by law, giving the government great leeway for
classification. Then the 1987 Constitution reverted to the 1935 Constitution classification with one addition: national parks. Of these, only agricultural lands may be alienated. x x
x31 (Emphasis supplied.)

Respondents-intervenors no longer had any right to Lot X not by acquisitive prescription, and certainly not by sales patent. In fact, their act of applying for the issuance of
miscellaneous sales patents operates as an express acknowledgment that the State, and not respondents-intervenors, is the owner of Lot X. It is erroneous to suppose that
respondents-intervenors possessed title to

Lot X when they applied for miscellaneous sales patents, for the premise of such grant or privilege is precisely that the State is the owner of the land, and that the applicant
acknowledges this and surrenders to State ownership. The government, as the agent of the State, is possessed of the plenary power as the persona in law to determine who shall be
the favored recipients of public lands, as well as under what terms they may be granted such privilege, not excluding the placing of obstacles in the way of their exercise of what
otherwise would be ordinary acts of ownership.32

Respondents-intervenors actions betray their claim of ownership to Lot X. When Proc. 168 was issued, they did not institute action to question its validity, using as cause of action their
claimed ownership and title over the land. The same is true when Proc. 2273 came out. They did not file suit to invalidate it because it contravenes their claimed ownership over Lot X.
They simply sat and waited for the good graces of the government to fall on their laps. They simply waited for the

State to declare them beneficiaries of the land. And when the President failed to include Lot X in Proc. 2273 and declare it open for disposition to them as beneficiaries, they filed their
applications for issuance of miscellaneous sales patents over said lot. All these actions are anathema to a claim of ownership, and instead indicate a willingness to abide by the actions
of the State, a show of respect for its dominion over the land.

Under the law, respondents-intervenors are charged with knowledge of the law; they cannot feign ignorance. In fact, they could not claim to be unaware of Proc. 168, for precisely they
hid under its protective mantle to seek the invalidation of a donation claimed to have been made by them to one Jose Tayoto. Thus, in Tayoto v. Heirs of Kusop,33 an alleged donee
(Tayoto) of property located within Lots X, Y-1, and Y-2 filed a case for quieting of title against the donors herein respondents-intervenors to protect the property which they allegedly
donated to him, which was then in danger of being lost for the reason that respondents-intervenors supposedly reneged on the donation. Respondents-intervenors filed an urgent
motion to dismiss the Complaint claiming, among others, the "invalidity of the donation as the subject thereof had not yet been

excluded from the Magsaysay Park."34 In disposing of the case, the Court made the following pronouncement:

Be that as it may, the donation is void. There are three essential elements of donations: [1] the reduction of the patrimony of the donor, [2] the increase in the patrimony of the donee,
and [3] the intent to do an act of liberality (animus donandi). Granting that there is an animus donandi, we find that the alleged donation lacks the first two elements which presuppose
the donor's ownership rights over the subject of the donation which he transmits to the donee thereby enlarging the donee's estate. This is in consonance with the rule that a donor
cannot lawfully convey what is not his property. In other words, a donation of a parcel of land the dominical rights of which do not belong to the donor at the time of the donation, is void.
This holds true even if the subject of the donation is not the land itself but the possessory and proprietary rights over said land.

In this case, although they allegedly declared Magsaysay Park as their own for taxation purposes, the heirs of Cabalo Kusop did not have any transmissible proprietary rights over the
donated property at the time of the donation. In fact, with respect to Lot Y-2, they still had to file a free patents application to obtain an original certificate of title thereon. This is because
Proclamation No. 2273 declaring as open to disposition under the provisions of the Public Land Act some portions of the Magsaysay Park, is not an operative law which automatically
vests rights of ownership on the heirs of Cabalo Kusop over their claimed parcels of land.

The import of said quoted proviso in a presidential proclamation is discussed in the aforecited Republic v. Court of Appeals case which dealt with the validity of a donation by a sales
awardee of a parcel of land which was later reserved by presidential proclamation for medical center site purposes. We held therein that where the land is withdrawn from the public
domain and declared as disposable by the Director of Lands under the Public Land Act, the Sales Award covering the same confers on a sales awardee only a possessory and not
proprietary right over the land applied, for. The disposition of the land by the Director is merely provisional as the applicant still has to comply with the requirements of the law before any
patent is issued. It is only after the compliance with such requirements that the patent is issued and the land applied for considered permanently disposed of by the Government.

The interpretation of said proviso should even be more stringent in this case considering that with respect to Lot Y-1, the heirs of Cabalo Kusop do not appear to have taken even the
initial steps mandated by the Public Land Act for claimants of the land excluded from the public domain. The alleged donation was therefore no more than an exercise in
futility.35 (Emphasis and underscoring supplied.)

For obvious reasons, respondents-intervenors should have, as early as 1990 when the above Decision was promulgated, taken exception to its pronouncements if they rightfully
believed that the property covered by Proc. 168 (which included Lot X) rightfully belonged to them. Yet they did not. Instead, after seven long years or in 1997, they filed their
applications for the issuance of miscellaneous sales patents over Lot X. This act of filing applications for the issuance of miscellaneous sales patents in their name, taken in conjunction
with all the other attendant circumstances, constitutes an express acknowledgment that the land does not belong to them, but to the State.

Neither may respondents-intervenors claim innocent mistake for all their missteps in claiming the subject property as their own. The mistakes are simply too numerous, and
respondents-intervenors inaction since 1963 is too glaring. To repeat, their actions are anathema to a claim of ownership. While it is true that possession since time immemorial could

result in the acquisition of title without need of judicial or other action, respondents-intervenors actions and conduct, as shown above, not only negate the application of such principle,
but in fact point to the opposite.

The principle of estoppel "bars [one] from denying the truth of a fact which has, in the contemplation of law, become settled by the acts and proceedings of judicial or legislative officers
or by the act of the party himself, either by conventional writing or by representations, express or implied or in pais."36

Besides, respondents-intervenors should not be allowed to trifle with the processes of the State.1wphi1 They cannot resort to other remedies which are improper and do not provide
for the opportunity to prove their title, but instead require them to concede it before availment.

Contrary to the CAs pronouncements, proof or evidence of possession since time immemorial becomes irrelevant and cannot support a claim of ownership or application for a patent,
not only because respondents-intervenors have conceded ownership to the State, but also on account of the fact that Lot X has been withdrawn from being alienable and disposable
public land, and is now classified and being used as a national park. It has ceased to be alienable, and no proof by the respondents-intervenors will operate to bolster their claim; Lot X
will never be awarded to them or to anybody so long as it is being used as a public park or reserve.

The CA justifies that Proc. 2273 was issued on the assumption that respondents-intervenors were about to donate Lot X to the city (General Santos City); thus, the President has seen
fit not to include it in the proclamation. This is specious. If the President indeed knew of the intended donation, then it was all the more necessary for him to have included Lot X in Proc.
2273 and withdrawn it from the coverage of Magsaysay Park; or else the donation to the city would be null and void, for want of right to donate. Yet he did not. Lot X was retained as
part of the park reserve precisely because the respondents-intervenors had no vested right to it. And, far from confirming ownership over Lot X, the Republic is correct in the opinion
that the miscellaneous sales patents amount to an acknowledgment that respondents-intervenors rights are inferior, and cannot defeat ownership over Lot X by the State.

Given the above pronouncements, the CAs ruling on other matters, as well as the respondents arguments on specific points, become irrelevant and inapplicable, if not necessarily
invalidated.

Finally, as regards AFP-RSBS rights, the Court sustains the petitioners view that "any title issued covering non-disposable lots even in the hands of an alleged innocent purchaser for
value shall be cancelled."37 We deem this case worthy of such principle. Besides, we cannot ignore the basic principle that a spring cannot rise higher than its source; as successor-ininterest, AFP-RSBS cannot acquire a better title than its predecessor, the herein respondents-intervenors.38 Having acquired no title to the property in question, there is no other
recourse but for AFP-RSBS to surrender to the rightful ownership of the State.

WHEREFORE, premises considered, the Petition is GRANTED. The October 26, 2007 Decision of the Court of Appeals in CA-G.R. CV No. 75170 is ANNULLED and SET ASIDE. The
November 5, 2001 Decision of the Regional Trial Court, Branch 23 of General Santos City in Civil Case No. 6419 is REINSTATED.

The Register of Deeds of General Santos City is ordered to CANCEL Transfer Certificates of Title Nos. T-81051, T-81052, T-81053, T-81054, T-81055, T-81056, T-81057, T-81058, T81059, T-81060, T-81061, T-81062, T-81146, T-81147, T-81150, and T-81151, and ISSUE in lieu thereof, new titles in the name of the Republic of the Philippines.

No costs.

SO ORDERED.

46. G.R. No. 187677

April 17, 2013

REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS (DPWH), Petitioner,
vs.
HON. ROSA SAMSON-TATAD, as Presiding Judge of the Regional Trial Court, Branch 105, Quezon City, and SPOUSES WILLIAM AND REBECCA GENATO, Respondents.

DECISION

SERENO, CJ.:

This is an appeal via a Petition for Review on Certiorari1 dated 19 June 2009 assailing the Decision2 and Resolution3of the Court of Appeals (CA) in C.A. G.R. SP No. 93227 which
affirmed the Orders4 of the Regional Trial Court (RTC), Branch 105, Quezon City in Civil Case No. Q-01-44595.The RTC barred petitioner from presenting evidence to prove its claim of
ownership over the subject property, as the presentation thereof would constitute a collateral attack on private respondents' title.

The antecedent facts are as follows:

On 13 July 2001, petitioner Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH), filed a Complaint against several defendants, including
private respondents, for the expropriation of several parcels of land affected by the construction of the EDSA-Quezon Avenue Flyover.5 Private respondents, Spouses William and
Rebecca Genato, are the registered owners of a piece of land ("subject property") covered by Transfer Certificate of Title (TCT) No. RT-11603 (383648)6 and having an area of 460
square meters.

During the pendency of the proceedings, petitioner received a letter dated 14 June 2002 from Engr. Patrick B. Gatan, Project Manager IV of the DPWH-NCR, reporting that the subject
property was "government land and that the transfer certificate of title of the said claimant respondent x x x is of dubious origin and of fabrication as it encroached or overlapped on a
government property."7 As a result, petitioner filed an Amended Complaint on 24 June 2002,8 seeking to limit the coverage of the proceedings to an area conforming to the findings of
the DPWH:

4. To accomplish said project, which is to be undertaken by the Department of Public Works and Highways [DPWH], it is necessary and urgent for plaintiff to acquire in fee simple
portions of the following parcels of land belonging to, occupied, possessed, and/or the ownership of which are being claimed by the defendants, to wit:

xxxx

[c] Defendants William O. Genato and Rebecca G. Genato.

xxxx

5. The portion of the above properties that are affected by the project and shaded green in the sketch plan hereto attached and made integral part hereof as Annex E, consisting of an
area of: x x x [c] 460 square meters of the aforedescribed property registered in the name of defendants spouses William and Rebecca Genato; x x x. (Emphasis in the original)

On 18 July 2002, petitioner filed a Manifestation and Motion9 to have the subject property "declared or considered of uncertain ownership or subject to conflicting claims."

In an Order dated 10 December 2002,10 the RTC admitted petitioners Amended Complaint, deferred the release to respondents the amount of eighteen million four hundred thousand
pesos (P18,400,000) deposited in the bank, equivalent to the current zonal valuation of the land, and declared the property as the subject of conflicting claims.

While petitioner was presenting evidence to show that the subject property actually belonged to the Government, private respondents interposed objections saying that petitioner was
barred from presenting the evidence, as it constituted a collateral attack on the validity of their TCT No. RT-11603 (383648). The RTC then required the parties to submit their
respective Memoranda.

Upon receipt of the Memoranda, the trial court issued on 12 July 2005 an Order11 as follows:

WHEFEFORE, premises considered, the Court finds that the issue of the validity of the TCT No. 11603 (383648) can only be raised in an action expressly instituted for that purpose
and not in this instant proceeding. Accordingly, plaintiff is barred from presenting evidence as they [sic] constitute collateral attack on the validity of the title to the subject lot in violation
of Sec. 48 of P. D. 1529.

On 4 August 2005, petitioner seasonably filed a Motion for Reconsideration,12 but the motion was denied by the RTC in an Order dated 17 November 2005.13

On 4 January 2006, private respondents filed a Motion for the payment of just compensation amounting to twenty million seven hundred thousand pesos (20,700,000) and for the
release of eighteen million four hundred thousand pesos ( P18,400,000) deposited in the Land BankSouth

Harbor Branch as partial payment.14 This Motion remains pending in the RTC to date.

On 9 February 2006, petitioner filed with the CA a Petition for Certiorari with Prayer for the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction.15

The appellate court ruled that since the subject property was covered by a Torrens title, Presidential Decree No. 1529, or the Property Registration Decree (P. D. 1529), necessarily
finds significance. Thus, it held that the RTC rightly applied Sec. 48. Accordingly, the CA issued its 29 September 2008 Decision,16 the dispositive portion of which reads:

WHEREFORE, the Petition for Certiorari is DISMISSED. The prayer for the issuance of a Writ of Preliminary Injunction is accordingly DENIED.

On 29 October 2008, petitioner filed a Motion for Reconsideration,17 but the motion was also denied in a Resolution dated 27 April 2009.18

Hence, the instant Petition.

A Comment19 on the Petition was filed by private respondents on 1 September 2009, and a Reply20 thereto by petitioner on 27 January 2010.

ISSUE

From the foregoing, the sole issue submitted for resolution before this Court is whether petitioner may be barred from presenting evidence to assail the validity of respondents title
under TCT No. RT-11603 (383648).

The Courts Ruling

Petitioner argues that under Section 9, Rule 67 of the Rules of Court, if the ownership of a property to be expropriated is uncertain, the court in the same expropriation proceeding is
also given authority to make a proper adjudication of the matter. Section 9 of Rule 67 reads:

SECTION 9. Uncertain Ownership. Conflicting Claims. If the ownership of the property taken is uncertain, or there are conflicting claims to any part thereof, the court may order any
sum or sums awarded as compensation for the property to be paid to the clerk of the court for the benefit of the persons adjudged in the same proceeding to be entitled thereto. But the
judgment shall require the payment of the sum or sums awarded to either the defendant or the clerk before the plaintiff can enter upon the property, or retain it for the public use or
purpose if entry has already been made.

This view is allegedly supported by Republic v. Court of First Instance of Pampanga, presided formerly by Judge L. Pasicolan21(Republic) in which the trial court hearing the
expropriation proceeding was also allowed to resolve the issue of ownership.

Petitioner further argues that the original Complaint was amended "precisely to reflect the fact that herein private respondents, albeit ostensibly appearing as registered owners, are to
be considered as mere claimants of one of the properties subject of the expropriation." This is the reason why the RTC issued an Order declaring the property subject of conflicting
claims.

Moreover, this being an in rem proceeding, "plaintiff Republic of the Philippines seeks the relief, both in the original and amended complaints, to transfer to plaintiff the titles to said
parcels of land together with their improvements free from all liens and encumbrances. For this particular purpose, the expropriation suit is essentially a direct proceeding."22

Private respondents, on the other hand, invoke Section 48 of P. D. 1529, viz:

SECTION 48. Certificate Not Subject to Collateral Attack. A certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or cancelled except in a direct
proceeding in accordance with law.

It is their contention that by allowing petitioner to present adversarial evidence, the court is in effect allowing respondents Torrens title to be collaterally attacked an action prohibited
by P. D. 1529.

We rule that petitioner may be allowed to present evidence to assert its ownership over the subject property, but for the sole purpose of determining who is entitled to just
compensation.

Proper interpretation of Section 9, Rule 67

Proceeding from the principle of jus regalia, the right to eminent domain has always been considered as a fundamental state power that is inseparable from sovereignty.23 It is
described as the States inherent power that need not be granted even by the Constitution,24 and as the government's right to appropriate, in the nature of compulsory sale to the State,
private property for public use or purpose.25

Expropriation, or the exercise of the States right to eminent domain, is proscribed by the restraints of public use and just compensation.26It is governed by Rule 67 of the Rules of
Court, which presents procedural guidelines for the court to ensure that due process is observed and just compensation rightly paid to the private owners.

Indeed, this Court first had the occasion to interpret Section 9, Rule 67 in the case of Republic. In addressing the issue of "whether or not the court that hears the expropriation case has
also jurisdiction to determine, in the same proceeding, the issue of ownership of the land sought to be condemned," the Court answered in the affirmative:

The sole issue in this case, i.e., whether or not the court that hears the expropriation case has also jurisdiction to determine, in the same proceeding, the issue of ownership of the land
sought to be condemned, must be resolved in the affirmative. That the court is empowered to entertain the conflicting claims of ownership of the condemned or sought to be condemned
property and adjudge the rightful owner thereof, in the same expropriation case, is evident from Section 9 of the Revised Rule 69, which provides:

SEC. 9. Uncertain ownership. Conflicting claims. If the ownership of the property taken is uncertain, or there are conflicting claims to any part thereof, the court may order any sum or
sums awarded as compensation for the property to be paid to the clerk of court for the benefit of the persons adjudged in the same proceeding to be entitled thereto. But the judgment
shall require the payment of the sum or sums awarded to either the defendant or the clerk before the plaintiff can enter upon the property, or retain it for the public use or purpose if
entry has already been made.

In fact, the existence of doubt or obscurity in the title of the person or persons claiming ownership of the properties to be expropriated would not preclude the commencement of the
action nor prevent the court from assuming jurisdiction thereof. The Rules merely require, in such eventuality, that the entity exercising the right of eminent domain should state in the
complaint that the true ownership of the property cannot be ascertained or specified with accuracy.27

We arrived at the same conclusion in Republic v. Rural Bank of Kabacan, Inc.,28 in which we held thus:

The trial court should have been guided by Rule 67, Section 9 of the 1997 Rules of Court, which provides thus:

SEC. 9. Uncertain ownership; conflicting claims. If the ownership of the property taken is uncertain, or there are conflicting claims to any part thereof, the court may order any sum or
sums awarded as compensation for the property to be paid to the court for the benefit of the person adjudged in the same proceeding to be entitled thereto. But the judgment shall
require the payment of the sum or sums awarded to either the defendant or the court before the plaintiff can enter upon the property, or retain it for the public use or purpose if entry has
already been made.

Hence, the appellate court erred in affirming the trial courts Order to award payment of just compensation to the defendants-intervenors. There is doubt as to the real owner of Lot No.
3080.

Despite the fact that the lot was covered by TCT No. T-61963 and was registered under its name, the Rural Bank of Kabacan manifested that the owner of the lot was no longer the
bank, but the defendants-intervenors; however, it presented no proof as to the conveyance thereof. In this regard, we deem it proper to remand this case to the trial court for the
reception of evidence to establish the present owner of Lot No. 3080 who will be entitled to receive the payment of just compensation.1wphi1 (Emphases supplied)

However, the authority to resolve ownership should be taken in the proper context. The discussion in Republic was anchored on the question of who among the respondents claiming
ownership of the property must be indemnified by the Government:

Now, to determine the person who is to be indemnified for the expropriation of Lot 6, Block 6, Psd-2017, the court taking cognizance of the expropriation must necessarily determine if
the sale to the Punzalan spouses by Antonio Feliciano is valid or not. For if valid, said spouses must be the ones to be paid by the condemnor; but if invalid, the money will be paid to
someone else. x x x.29

Thus, such findings of ownership in an expropriation proceeding should not be construed as final and binding on the parties. By filing an action for expropriation, the condemnor
(petitioner), merely serves notice that it is taking title to and possession of the property, and that the defendant is asserting title to or interest in the property, not to prove a right to
possession, but to prove a right to compensation for the taking.30

If at all, this situation is akin to ejectment cases in which a court is temporarily authorized to determine ownership, if only to determine who is entitled to possession. This is not
conclusive, and it remains open to challenge through proper actions.31 The consequences of Sec. 9, Rule 67 cannot be avoided, as they are due to the intimate relationship of the
issue of ownership with the claim for the expropriation payment.32

II

Inapplicability of Section 48, P. D. 1529

Verily, our interpretation of Sec. 9, Rule 67 does not run counter to Section 48 of P.D. 1529. Under Sec. 48, collateral attacks on a Torrens title are prohibited. We have explained the
concept in Oo v. Lim,33 to wit:

An action or proceeding is deemed an attack on a title when its objective is to nullify the title, thereby challenging the judgment pursuant to which the title was decreed. The attack is
direct when the objective is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral when, in an action to obtain a different
relief, an attack on the judgment is nevertheless made as an incident thereof.

In several instances, we have considered an Answer praying for the cancellation of the plaintiff's Torrens title as a form of a collateral attack.34 We have afforded the similar treatment
in a petition questioning the validity of a deed of sale for a registered land,35 and in a reformation of a deed of sale to include areas registered under the name of another party.36 But a
resolution on the issue of ownership in a partition case was deemed neither to be a direct or collateral attack, for "until and unless this issue of co-ownership is definitely and finally
resolved, it would be premature to effect a partition of the disputed properties."37

Here, the attempt of petitioner to present evidence cannot be characterized as an "attack." It must be emphasized that the objective of the case is to appropriate private property, and
the contest on private respondents' title arose only as an incident to the issue of whom should be rightly compensated.

Contrary to petitioner's allegations, the Complaint and Amended Complaint cannot also be considered as a direct attack. The amendment merely limited the coverage of the
expropriation proceedings to the uncontested portion of the subject property. The RTC's Order declaring the property as subject of conflicting claims is a recognition that there are
varying claimants to the sums to be awarded as just compensation. This serves as an authority for the court to conduct a limited inquiry on the property's ownership.

WHEREFORE, the Court GRANTS the Petition for Review on Certiorari and the prayer for a Writ of Preliminary Injunction. The assailed Decision and Resolution of the Court of Appeals
in CA-G.R. SP No. 93227, as well as the Decision of the Regional Trial Court, Branch 105, Quezon City in Civil Case No. Q-01-44595, are hereby REVERSED and SET ASIDE. This
case is REMANDED to the RTC to hear the issue of ownership for the purpose of just compensation.

SO ORDERED.

47. G.R. No. 182449

March 6, 2013

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
MARTIN T. NG, Respondent.

DECISION

SERENO, CJ:

Before this Court is a Rule 45 Petition, seeking a review of the 25 March 2008 Decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 01143, which affirmed the 23 October 2002
Amended Decision2 of the Municipal Trial Court (MTC), Consolacion, Cebu, in LR Case No. N-12, LRA Record No. N-67773. The MTC ordered the registration and confirmation of title
over five parcels of land claimed by respondent Martin T. Ng.

The antecedent facts are as follows:3.

On 7 January 1997, respondent filed an application for the original registration of title over Lot Nos. 9663, 9666, 9668, 9690 and 9691, CAD 545-D (New) situated at Cansaga,
Consolacion, Cebu. He claimed ownership of these five parcels of land with a total area of 1,841 square meters. His claim was based on his purchase thereof from the vendors, who
had possessed the realties for more than thirty (30) years.

During the reception of evidence by the Clerk of Court, respondent furnished the following pieces of documentary evidence to establish his purchase of the lots: (1) Deed of Absolute
Sale between him and Eustaquio Tibon;4 (2) Extra-judicial Settlement of Estate & Sale between him and Olivia Sicad vda. de Ouano;5 (3) Deed of Definite Sale by Eduardo and
Virginia Capao;6 (4) Deed of Absolute Sale between him and Victoria Capadiso;7 and (5) Agreement of Partition between him and Victoria Capadiso.8 In addition, he attached the
numerous vintage Tax Declarations9 dating as far back as 1948.10 These Tax Declarations were either under the names of the vendors, the previous transferors and the original
owners of the lots. The regularity and due execution of these contracts, Tax Declarations and realty payments were never assailed by petitioner.

Respondent also submitted the following documents to prove his ownership: (1) the Department of Environment and Natural Resources (DENR) Certification showing that the subject
lots were within the alienable and disposable lands of the public domain;11 (2) the DENR Certification stating that the lots are not covered by any other subsisting public land
application;12 and (3) the original tracing cloth plan covering the properties.13 Similarly, these pieces of evidence were never assailed by petitioner.

As for testimonial evidence, respondent narrated that these lots were purchased from the aforementioned vendees and predecessors-in-interest, who had been in possession of the lots
for more than thirty (30) years. In support of his claims, he further presented the testimony of the 77-year-old Josefa N. Fat (Fat), who lived near the subject lots.

According to Fat, she met respondent in 1993, when he brought with him workers assigned to plant trees and to fence the property. Since then, she recounted that she saw him on the
subject lots for several times.

Further, she stated that she knew the original owners and vendees of the lots, as they were her neighbors and close friends. She also recounted that the properties were either inherited
or transferred by the past owners to the vendors, who in turn sold them to Martin T. Ng; and that there is no other person who laid claim over the lots. She ended her testimony by
asserting with certainty that the ownership and possession by respondent and his predecessors-in-interest were public, peaceful, open, continuous, and in the concept of an owner.

After the presentation of evidence, the MTC rendered its 23 October 2002 Decision confirming respondents title to the subject lots and ordering the registration of the title in his name.

Petitioner, as represented by the Office of the Solicitor General (OSG), appealed to the CA. In a lone assignment of error, it averred that the trial court erred in granting Ngs application,
since respondent had failed to comply with the requirements for the original registration of title.

Petitioner contended that respondent had failed to substantiate his alleged possession and occupation. It attacked Fats testimony as full of motherhood statements, which could not be
given weight by the courts. In addition, it asserted that the Tax Declarations attached to the application merely provided an indicia of possession, and not a conclusive proof of
ownership.

The CA affirmed the factual findings of the MTC. It appreciated the statement of Josefa Fat, who lived near the subject parcels of land, that she knew their previous owners as her
neighbors and close acquaintances. According to the appellate court, this testimony was even corroborated by

Tax Declarations and realty tax payments, which altogether sufficiently established the possession of the realties by respondents predecessors-in-interest.14 Hence, the CA held:15

Considering that the possession of the subject parcels of land by the applicant-appellee tacked to that of his predecessors-in-interest, covered a period of forty-nine (49) years to the
time of the filing of the application for registration in 1997, we hold that applicant-appellee has acquired an imperfect title thereto which may be subject to confirmation and brought
under the operation of the Torrens system.

WHEREFORE , the assailed Amended Decision dated October 23, 2002 of the MTC Consolacion, Cebu, is AFFIRMED.

Aggrieved, petitioner reiterates its lone assignment of error before this Court:16 that the CA gravely erred in affirming the trial courts appreciation of respondents claim of ownership as
one that had been established by virtue of an open, continuous, exclusive and notorious possession of the subject lots.

RULING OF THE COURT

In a judicial confirmation of title under original registration proceedings, applicants may obtain the registration of title to land upon a showing that they or their predecessors-in-interest
have been in (1) open, continuous, exclusive, and notorious possession and occupation of (2) agricultural lands of the public domain, (3) under a bona fide claim of acquisition or
ownership, (4) for at least 30 years immediately preceding the filing of the application for confirmation of title, except when prevented by war or force majeure.17 The burden of proof in
land registration cases rests on applicants who must show clear, positive and convincing evidence that their alleged possession and occupation were of the nature and duration
required by law.18

In this case, what is questioned is the sufficiency of the evidence submitted to prove that the possession by respondents predecessors-in-interest was of the nature required by the
Public Land Act and the Property Registration Decree. Specifically, respondent must prove that his predecessors-in-interest openly, continuously, exclusively, and notoriously
possessed the realties.

Possession is acquired in any of the following ways: (1) by the material occupation of the thing; (2) by the exercise of a right; (3) by the fact that the property is subject to the action of
our will; and (4) by the proper acts and legal formalities established for acquiring the right.19 In Director of Lands v. IAC,20 we explained the nature of the possession required to
confirm ones title as follows:

Possession is open when it is patent, visible, apparent, notorious and not clandestine. It is continuous when uninterrupted, unbroken and not intermittent or occasional; exclusive when
the adverse possessor can show exclusive dominion over the land and an appropriation of it to his own use and benefit; and notorious when it is so conspicuous that it is generally
known and talked of by the public or the people in the neighborhood. (Emphasis supplied)

In perusing the evidence submitted by respondent, petitioner claims21 that the former merely presented (1) a witness testimony full of motherhood statements, and (2) Tax Declarations
and realty payments that do not conclusively prove ownership. Thus, the Republic claims that the evidence of possession is insufficient.

However, as found by the courts a quo, it is clear from the records that respondent presented several pieces of documentary evidence to prove that he openly possessed the properties.
He submitted notarized Deeds of Sale, Agreements of Partition and Extra-judicial Settlement of Estate and Sale to show the acquisition of the lands from his predecessors-in-interest.22

Moreover, he presented Tax Declarations and realty payments showing that he and his predecessors-in-interest had been paying real estate taxes since 1948 until the inception of this
case in 1997; hence, for more than 30 years. He also submitted the original tracing cloth plan in which the advance survey plan shows that the subject lots had previously been under
the names of the vendors, the previous transferors, and the original owners of the lots.23

As we have ruled in Republic v. Sta. Ana-Burgos,24 while tax declarations and realty tax payments on property are not conclusive evidence of ownership, they are nevertheless good
indicia of possession in the concept of owner, for no one in the right frame of mind would be paying taxes for a property that is not in ones actual or at least constructive possession.

The voluntary declaration of a piece of property for taxation purposes is an announcement of ones claim against the State and all other interested parties.25 In fact, these documents
already constitute prima facie evidence of possession.26 Moreover, if the holders of the land present a deed of conveyance in their favor from its former owner to support their claim of

ownership, the declaration of ownership and tax receipts relative to the property may be used to prove their good faith in occupying and possessing it.27 Additionally, when considered
with actual possession of the property, tax receipts constitute evidence of great value in support of the claim of title of ownership by prescription.28

As for testimonial evidence, although it is unfortunate that respondents counsel failed to ask Fat specific questions as to the fact of possession, it is evident that respondents
predecessors-in-interest were the witness longtime neighbors and close friends who lived near the subject lots. Logically, it can be inferred that respondents predecessors-in-interest
materially occupied and continuously possessed the adjoining property. Her testimony reads thus:29

Q: Do you know a certain Nemesio Tibon?

A: Yes, sir.

Q: Why do you know him?

A: Because he was my close neighbor.

Q: In relation to Lot 9663 one of the subject lots, who is he?

A: He was the original owner of Lot No. 9663.

Q: Where is Nemesio Tibon now?

A: He is already dead.

Q: After Nemesio Tibon died, who owned and possessed Lot No. 9663?

A: It was his son, Eustaquio Tibon, who owned and possessed Lot No. 9663 after he inherited the same from Nemesio Tibon.

Q: From his son, Eustaquio Tibon, where did the property go?

A: It was owned and possessed by the applicant, Martin T. Ng, after the latter bought it from Eustaquio Tibon.

Q: Do you know a certain Diego Balaba?

A: Yes, sir.

Q: Why do you know him?

A: We were very close neighbors before.

Q: In relation to Lot No. 9666, one of the subject lots, who is he?

A: He was the original owner of Lot No. 9666.

Q: Where is Diego Balaba now?

A: He is already dead.

Q: From Diego Balaba, who owned and possessed Lot No. 9666?

A: It was the spouses Rufino Quano and Oliva Sicad who owned and possessed the same after they bought it from Diego Balaba.

Q: How did you know about this fact?

A: As I have said, Diego Balaba was my close neighbor and I was present when the sale was made.

Q: From the spouses Rufino Quano and Oliva Sicad, who owned and possessed Lot No. 9666?

A: It was the applicant, Martin T. Ng, who owned and possessed Lot No. 9666 after the latter bought it from the spouses Rufino Quano and Oliva Sicad.

Q: Do you know a certain Liberato Alivio?

A: Yes, sir.

Q: Why do you know him?

A: He was my neighbor and a very close friend of mine.

Q: In relation to Lot No. 9668, one of the subject lots, who is he?

A: He was the original owner of Lot No. 9668.

Q: Where is Liberato Alivio now?

A: He is already dead.

Q: After Liberato Alivio died, who owned and possessed Lot No. 9668?

A: It was owned and possessed by his wife, Cipriana Herbieto.

Q: From Cipriana Herbieto, where did Lot No. 9668 go?

A: It was owned and possessed by his son, Ireneo Alivio, who, in turn, sold the same to the spouses Eduardo Capao and Virginia Alivio.

Q: From the spouses Eduardo Capao and Virginia Alivio, who owned and possessed Lot No. 9668?

A: It was owned and possessed by the applicant, Martin T. Ng, after the latter purchased the same from the spouses Eduardo Capao and Virginia Alivio.

Q: Why do you know all these facts?

A: Because I am living near the land and that the previous owners of the said land were my neighbor and close friends.

Q: Do you know a certain Julian Capadiso?

A: Yes, sir.

Q: Why do you know him?

A: He was my neighbor and a very close friend.

Q: Where is Julian Capadiso now?

A: He is already dead.

Q: In relation to Lot No. 9690, one of the subject lots, who is he?

A: He was the original owner of Lot No. 9690.

Q: After Julian Capadiso died, who owned and possessed Lot No. 9690?

A: It was owned and possessed by the spouses Eustiquiano Naingue and Victoria Capadiso after the latter bought it from Julian Capadiso.

Q: From the spouses Eustiquiano Naingue and Victoria Capadiso, where did the property go?

A: It was owned and possessed by the applicant, Martin T. Ng, after the latter bought it from the spouses Eustiquiano Naingue and Victoria Capadiso.

Q: Why do you know all about these facts?

A: As I have said, I am living near the land and the original and previous owners of the said lot are my neighbors and close friends.

Q: Do you know a certain Saturnino Capadiso?

A: Yes, sir.

Q: Why do you know him?

A: He was my neighbor.

Q: Where is Saturnino Capadiso now?

A: He is already dead.

Q: In relation to Lot No. 9691 one of the subject lots, who is he?

A: He was the original owner of Lot No.9691.

Q: From Saturnino Capadiso, who owned and possessed Lot No. 9691?

A: It was owned and possessed by his daughter, Victoria Capadiso after the latter inherited the same from his father, Saturnino Capadiso.

Q: After Victoria Capadiso, who owned and possessed Lot No. 9691?

A: It was owned and possessed by the applicant, Martin T. Ng after the latter purchased the same from Victoria Capadiso.

Q: What can you say then of the ownership and possession of the applicant over the subject lots?

A: I can say with certainty that the ownership and possession of the applicant and that of his predecessors-in-interest over the subject lots is public, peaceful, open, continuous and in
concept of owners.

Atty. Seno:

That is all for the witness your Honor.

xxxx

The said witness further narrated that the lots were transferred either through a contract of sale or though succession, from the original owners to the vendors who later became
respondents predecessors-in-interest. Taken together, these acts of transferring the property evinced the exercise of their ownership rights over the lots.

Far from giving a motherhood statement, Fat also asserted with certainty that no other person laid claim to the lots. This fact was corroborated by the DENR Certification that the lots
were not covered by any other subsisting public land application. Accordingly, respondent supplied proof of his exclusive possession of the realties.

Therefore, given these pieces of documentary evidence consisting of muniments of title, tax declarations and realty payments which were not disputed by petitioner; and the testimony
as regards the actual possession for more than 30 years by respondents predecessors-in-interest the OSG inaccurately portrayed respondent as merely making general submissions
in proving his claims. Rather, as found by the courts a quo, he amply established that he and his predecessors-in-interest owned and possessed the subject lots openly, continuously,
exclusively, and notoriously, as required by our registration laws.1wphi1

For these reasons, we see no reason to reverse the congruent factual findings of the MTC and the CA.

IN VIEW THEREOF, the assailed 25 March 2008 Decision of the Court of Appeals in CA-G.R. CV No. 01143 is hereby AFFIRMED.

SO ORDERED.

48. G.R. No. 199310

February 19, 2014

REPUBLIC OF THE PHILIPPINES, Petitioner,

vs.
REMMAN ENTERPRISES, INC., represented by RONNIE P. INOCENCIO, Respondent.

DECISION

REYES, J.:

Before this Court is a petition for review on certiorari1 under Rule 45 of the Rules of Court seeking to annul and set aside the Decision2 dated November 10, 2011 of the Court of
Appeals (CA) in CA-G.R. CV No. 90503. The CA affirmed the Decision3 dated May 16, 2007 of the Regional Trial Court (RTC) of Pasig City, Branch 69, in Land Registration Case No.
N-11465.

The Facts

On December 3, 2001, Remman Enterprises, Inc. (respondent), filed an application4 with the RTC for judicial confirmation of title over two parcels of land situated in Barangay
Napindan, Taguig, Metro Manila, identified as Lot Nos. 3068 and 3077, Mcadm-590-D, Taguig Cadastre, with an area of 29,945 square meters and 20,357 sq m, respectively.

On December 13, 2001, the RTC issued the Order5 finding the respondents application for registration sufficient in form and substance and setting it for initial hearing on February 21,
2002. The scheduled initial hearing was later reset to May 30, 2002.6 The Notice of Initial Hearing was published in the Official Gazette, April 1, 2002 issue, Volume 98, No. 13, pages
1631-16337 and in the March 21, 2002 issue of Peoples Balita,8 a newspaper of general circulation in the Philippines. The Notice of Initial Hearing was likewise posted in a
conspicuous place on Lot Nos. 3068 and 3077, as well as in a conspicuous place on the bulletin board of the City hall of Taguig, Metro Manila.9

On May 30, 2002, when the RTC called the case for initial hearing, only the Laguna Lake Development Authority (LLDA) appeared as oppositor. Hence, the RTC issued an order of
general default except LLDA, which was given 15 days to submit its comment/opposition to the respondents application for registration.10

On June 4, 2002, the LLDA filed its Opposition11 to the respondents application for registration, asserting that Lot Nos. 3068 and 3077 are not part of the alienable and disposable
lands of the public domain. On the other hand, the Republic of the Philippines (petitioner), on July 16, 2002, likewise filed its Opposition,12 alleging that the respondent failed to prove
that it and its predecessors-in-interest have been in open, continuous, exclusive, and notorious possession of the subject parcels of land since June 12, 1945 or earlier.

Trial on the merits of the respondents application ensued thereafter.

The respondent presented four witnesses: Teresita Villaroya, the respondents corporate secretary; Ronnie Inocencio, an employee of the respondent and the one authorized by it to file
the application for registration with the RTC; Cenon Cerquena (Cerquena), the caretaker of the subject properties since 1957; and Engineer Mariano Flotildes (Engr. Flotildes), a
geodetic engineer hired by the respondent to conduct a topographic survey of the subject properties.

For its part, the LLDA presented the testimonies of Engineers Ramon Magalonga (Engr. Magalonga) and Christopher A. Pedrezuela (Engr. Pedrezuela), who are both geodetic
engineers employed by the LLDA.

Essentially, the testimonies of the respondents witnesses showed that the respondent and its predecessors-in-interest have been in open, continuous, exclusive, and notorious
possession of the said parcels of land long before June 12, 1945. The respondent purchased Lot Nos. 3068 and 3077 from Conrado Salvador (Salvador) and Bella Mijares (Mijares),
respectively, in 1989. The subject properties were originally owned and possessed by Veronica Jaime (Jaime), who cultivated and planted different kinds of crops in the said lots,
through her caretaker and hired farmers, since 1943. Sometime in 1975, Jaime sold the said parcels of land to Salvador and Mijares, who continued to cultivate the lots until the same
were purchased by the respondent in 1989.

The respondent likewise alleged that the subject properties are within the alienable and disposable lands of the public domain, as evidenced by the certifications issued by the
Department of Environment and Natural Resources (DENR).

In support of its application, the respondent, inter alia, presented the following documents: (1) Deed of Absolute Sale dated August 28, 1989 executed by Salvador and Mijares in favor
of the respondent;13 (2) survey plans of the subject properties;14 (3) technical descriptions of the subject properties;15 (4) Geodetic Engineers Certificate;16 (5) tax declarations of Lot
Nos. 3068 and 3077 for 2002;17 and (6) certifications dated December 17, 2002, issued by Corazon D. Calamno (Calamno), Senior Forest Management Specialist of the DENR,
attesting that Lot Nos. 3068 and 3077 form part of the alienable and disposable lands of the public domain.18

On the other hand, the LLDA alleged that the respondents application for registration should be denied since the subject parcels of land are not part of the alienable and disposable
lands of the public domain; it pointed out that pursuant to Section 41(11) of Republic Act No. 485019 (R.A. No. 4850), lands, surrounding the Laguna de Bay, located at and below the
reglementary elevation of 12.50 meters are public lands which form part of the bed of the said lake. Engr. Magalonga, testifying for the oppositor LLDA, claimed that, upon preliminary
evaluation of the subject properties, based on the topographic map of Taguig, which was prepared using an aerial survey conducted by the then Department of National DefenseBureau of Coast in April 1966, he found out that the elevations of Lot Nos. 3068 and 3077 are below 12.50 m. That upon actual area verification of the subject properties on September
25, 2002, Engr. Magalonga confirmed that the elevations of the subject properties range from 11.33 m to 11.77 m.

On rebuttal, the respondent presented Engr. Flotildes, who claimed that, based on the actual topographic survey of the subject properties he conducted upon the request of the
respondent, the elevations of the subject properties, contrary to LLDAs claim, are above 12.50 m. Particularly, Engr. Flotildes claimed that Lot No. 3068 has an elevation ranging from
12.60 m to 15 m while the elevation of Lot No. 3077 ranges from 12.60 m to 14.80 m.

The RTC Ruling

On May 16, 2007, the RTC rendered a Decision,20 which granted the respondents application for registration of title to the subject properties, viz:

WHEREFORE, premises considered, judgment is rendered confirming the title of the applicant Remman Enterprises Incorporated over a parcels of land [sic] consisting of 29,945
square meters (Lot 3068) and 20,357 (Lot 3077) both situated in Brgy. Napindan, Taguig, Taguig,

Metro Manila more particularly described in the Technical Descriptions Ap-04-003103 and Swo-00-001769 respectively and ordering their registration under the Property Registration
Decree in the name of Remman Enterprises Incorporated.

SO ORDERED.21

The RTC found that the respondent was able to prove that the subject properties form part of the alienable and disposable lands of the public domain. The RTC opined that the
elevations of the subject properties are very much higher than the reglementary elevation of 12.50 m and, thus, not part of the bed of Laguna Lake. The RTC pointed out that LLDAs
claim that the elevation of the subject properties is below 12.50 m is hearsay since the same was merely based on the topographic map that was prepared using an aerial survey on
March 2, 1966; that nobody was presented to prove that an aerial survey was indeed conducted on March 2, 1966 for purposes of gathering data for the preparation of the topographic
map.

Further, the RTC posited that the elevation of a parcel of land does not always remain the same; that the elevations of the subject properties may have already changed since 1966
when the supposed aerial survey, from which the topographic map used by LLDA was based, was conducted. The RTC likewise faulted the method used by Engr. Magalonga in
measuring the elevations of the subject properties, pointing out that:

Further, in finding that the elevation of the subject lots are below 12.5 meters, oppositors witness merely compared their elevation to the elevation of the particular portion of the lake
dike which he used as his [benchmark] or reference point in determining the elevation of the subject lots. Also, the elevation of the said portion of the lake dike that was then under the
construction by FF Cruz was allegedly 12.79 meters and after finding that the elevation of the subject lots are lower than the said [benchmark] or reference point, said witness suddenly
jumped to a conclusion that the elevation was below 12.5 meters. x x x.

Moreover, the finding of LLDAs witness was based on hearsay as said witness admitted that it was DPWH or the FF Cruz who determined the elevation of the portion of the lake dike
which he used as the [benchmark] or reference point in determining the elevation of the subject lots and that he has no personal knowledge as to how the DPWH and FF Cruz
determined the elevation of the said [benchmark] or reference point and he only learn[ed] that its elevation is 12.79 meters from the information he got from FF Cruz.22

Even supposing that the elevations of the subject properties are indeed below 12.50 m, the RTC opined that the same could not be considered part of the bed of Laguna Lake. The
RTC held that, under Section 41(11) of R.A. No. 4850, Laguna Lake extends only to those areas that can be covered by the lake water when it is at the average annual maximum lake
level of 12.50 m. Hence, the RTC averred, only those parcels of land that are adjacent to and near the shoreline of Laguna Lake form part of its bed and not those that are already far

from it, which could not be reached by the lake water. The RTC pointed out that the subject properties are more than a kilometer away from the shoreline of Laguna Lake; that they are
dry and waterless even when the waters of Laguna Lake is at its maximum level. The RTC likewise found that the respondent was able to prove that it and its predecessors-in-interest
have been in open, continuous, exclusive, and notorious possession of the subject properties as early as 1943.

The petitioner appealed the RTC Decision dated May 16, 2007 to the CA.

The CA Ruling

On November 10, 2011, the CA, by way of the assailed Decision,23 affirmed the RTC Decision dated May 16, 2007. The CA found that the respondent was able to establish that the
subject properties are part of the alienable and disposable lands of the public domain; that the same are not part of the bed of Laguna Lake, as claimed by the petitioner. Thus:

The evidence submitted by the appellee is sufficient to warrant registration of the subject lands in its name. Appellees witness Engr. Mariano Flotildes, who conducted an actual area
verification of the subject lots, ably proved that the elevation of the lowest portion of Lot No. 3068 is 12.6 meters and the elevation of its highest portion is 15 meters. As to the other lot,
it was found [out] that the elevation of the lowest portion of Lot No. 3077 is also 12.6 meters and the elevation of its highest portion is 15 meters. Said elevations are higher than the
reglementary elevation of 12.5 meters as provided for under paragraph 11, Section 41 of R.A. No. 4850, as amended.

In opposing the instant application for registration, appellant relies merely on the Topographic Map dated March 2, 1966, prepared by Commodore Pathfinder, which allegedly shows
that the subject parcels of land are so situated in the submerge[d] [lake water] of Laguna Lake. The said data was gathered through aerial photography over the area of Taguig
conducted on March 2, 1966. However, nobody testified on the due execution and authenticity of the said document. As regards the testimony of the witness for LLDA, Engr. Ramon
Magalonga, that the subject parcels of land are below the 12.5 meter elevation, the same can be considered inaccurate aside from being hearsay considering his admission that his
findings were based merely on the evaluation conducted by DPWH and FF Cruz. x x x.24 (Citations omitted)

The CA likewise pointed out that the respondent was able to present certifications issued by the DENR, attesting that the subject properties form part of the alienable and disposable
lands of the public domain, which was not disputed by the petitioner. The CA further ruled that the respondent was able to prove, through the testimonies of its witnesses, that it and its
predecessors-in-interest have been in open, continuous, exclusive, and notorious possession of the subject properties prior to June 12, 1945.

Hence, the instant petition.

The Issue

The sole issue to be resolved by the Court is whether the CA erred in affirming the RTC Decision dated May 16, 2007, which granted the application for registration filed by the
respondent.

The Courts Ruling

The petition is meritorious.

The petitioner maintains that the lower courts erred in granting the respondents application for registration since the subject properties do not form part of the alienable and disposable
lands of the public domain. The petitioner insists that the elevations of the subject properties are below the reglementary level of 12.50 m and, pursuant to Section 41(11) of R.A. No.
4850, are considered part of the bed of Laguna Lake.

That the elevations of the subject properties are above the reglementary level of 12.50 m is a finding of fact by the lower courts, which this Court, generally may not disregard. It is a
long-standing policy of this Court that the findings of facts of the RTC which were adopted and affirmed by the CA are generally deemed conclusive and binding. This Court is not a trier
of facts and will not disturb the factual findings of the lower courts unless there are substantial reasons for doing so.25

That the subject properties are not part of the bed of Laguna Lake, however, does not necessarily mean that they already form part of the alienable and disposable lands of the public
domain. It is still incumbent upon the respondent to prove, with well-nigh incontrovertible evidence, that the subject properties are indeed part of the alienable and disposable lands of
the public domain. While deference is due to the lower courts finding that the elevations of the subject properties are above the reglementary level of 12.50 m and, hence, no longer

part of the bed of Laguna Lake pursuant to Section 41(11) of R.A. No. 4850, the Court nevertheless finds that the respondent failed to substantiate its entitlement to registration of title
to the subject properties.

"Under the Regalian Doctrine, which is embodied in our Constitution, all lands of the public domain belong to the State, which is the source of any asserted right to any ownership of
land. All lands not appearing to be clearly within private ownership are presumed to belong to the State. Accordingly, public lands not shown to have been reclassified or released as
alienable agricultural land, or alienated to a private person by the State, remain part of the inalienable public domain. The burden of proof in overcoming the presumption of State
ownership of the lands of the public domain is on the person applying for registration, who must prove that the land subject of the application is alienable or disposable. To overcome
this presumption, incontrovertible evidence must be presented to establish that the land subject of the application is alienable or disposable."26

The respondent filed its application for registration of title to the subject properties under Section 14(1) of Presidential Decree (P.D.) No. 152927, which provides that:

Sec. 14. Who may apply. The following persons may file in the proper Court of First Instance an application for registration of title to land, whether personally or through their duly
authorized representatives:

(1) Those who by themselves or through their predecessors-in interest have been in open, continuous, exclusive and notorious possession and occupation of alienable and disposable
lands of the public domain under a bona fide claim of ownership since June 12, 1945, or earlier.

xxxx

Section 14(1) of P.D. No. 1529 refers to the judicial confirmation of imperfect or incomplete titles to public land acquired under Section 48(b) of Commonwealth Act (C.A.) No. 141, or
the Public Land Act, as amended by P.D. No. 1073.28 Under Section 14(1) of P.D. No. 1529, applicants for registration of title must sufficiently establish: first, that the subject land
forms part of the disposable and alienable lands of the public domain; second, that the applicant and his predecessors-in-interest have been in open, continuous, exclusive, and
notorious possession and occupation of the same; and third, that it is under a bona fide claim of ownership since June 12, 1945, or earlier.29

The first requirement was not satisfied in this case. To prove that the subject property forms part of the alienable and disposable lands of the public domain, the respondent presented
two certifications30 issued by Calamno, attesting that Lot Nos. 3068 and 3077 form part of the alienable and disposable lands of the public domain "under Project No. 27-B of Taguig,
Metro Manila as per LC Map 2623, approved on January 3, 1968."

However, the said certifications presented by the respondent are insufficient to prove that the subject properties are alienable and disposable. In Republic of the Philippines v. T.A.N.
Properties, Inc.,31 the Court clarified that, in addition to the certification issued by the proper government agency that a parcel of land is alienable and disposable, applicants for land
registration must prove that the DENR Secretary had approved the land classification and released the land of public domain as alienable and disposable. They must present a copy of
the original classification approved by the DENR Secretary and certified as true copy by the legal custodian of the records. Thus:

Further, it is not enough for the PENRO or CENRO to certify that a land is alienable and disposable. The applicant for land registration must prove that the DENR Secretary had
approved the land classification and released the land of the public domain as alienable and disposable, and that the land subject of the application for registration falls within the
approved area per verification through survey by the PENRO or CENRO. In addition, the applicant for land registration must present a copy of the original classification approved by the
DENR Secretary and certified as a true copy by the legal custodian of the official records. These facts must be established to prove that the land is alienable and disposable.
Respondent failed to do so because the certifications presented by respondent do not, by themselves, prove that the land is alienable and disposable.32 (Emphasis ours)

In Republic v. Roche,33 the Court deemed it appropriate to reiterate the ruling in T.A.N. Properties, viz:

Respecting the third requirement, the applicant bears the burden of proving the status of the land. In this connection, the Court has held that he must present a certificate of land
classification status issued by the Community Environment and Natural Resources Office (CENRO) or the Provincial Environment and Natural Resources Office (PENRO) of the DENR.
He must also prove that the DENR Secretary had approved the land classification and released the land as alienable and disposable, and that it is within the approved area per
verification through survey by the CENRO or PENRO. Further, the applicant must present a copy of the original classification approved by the DENR Secretary and certified as true
copy by the legal custodian of the official records. These facts must be established by the applicant to prove that the land is alienable and disposable.

Here, Roche did not present evidence that the land she applied for has been classified as alienable or disposable land of the public domain. She submitted only the survey map and
technical description of the land which bears no information regarding the lands classification. She did not bother to establish the status of the land by any certification from the

appropriate government agency. Thus, it cannot be said that she complied with all requisites for registration of title under Section 14(1) of P.D. 1529.34 (Citations omitted and emphasis
ours)

The DENR certifications that were presented by the respondent in support of its application for registration are thus not sufficient to prove that the subject properties are indeed
classified by the DENR Secretary as alienable and disposable. It is still imperative for the respondent to present a copy of the original classification approved by the DENR Secretary,
which must be certified by the legal custodian thereof as a true copy. Accordingly, the lower courts erred in granting the application for registration in spite of the failure of the
respondent to prove by well-nigh incontrovertible evidence that the subject properties are alienable and disposable.

Nevertheless, the respondent claims that the Courts ruling in T.A.N. Properties, which was promulgated on June 26, 2008, must be applied prospectively, asserting that decisions of
this Court form part of the law of the land and, pursuant to Article 4 of the Civil Code, laws shall have no retroactive effect. The respondent points out that its application for registration
of title to the subject properties was filed and was granted by the RTC prior to the Courts promulgation of its ruling in T.A.N. Properties. Accordingly, that it failed to present a copy of
the original classification covering the subject properties approved by the DENR Secretary and certified by the legal custodian thereof as a true copy, the respondent claims, would not
warrant the denial of its application for registration.

The Court does not agree.

Notwithstanding that the respondents application for registration was filed and granted by RTC prior to the Courts ruling in T.A.N. Properties, the pronouncements in that case may be
applied to the present case; it is not antithetical to the rule of non-retroactivity of laws pursuant to Article 4 of the Civil Code. It is elementary that the interpretation of a law by this Court
constitutes part of that law from the date it was originally passed, since this Courts construction merely establishes the contemporaneous legislative intent that the interpreted law
carried into effect.35 "Such judicial doctrine does not amount to the passage of a new law, but consists merely of a construction or interpretation of a pre-existing one."36

Verily, the ruling in T.A.N. Properties was applied by the Court in subsequent cases notwithstanding that the applications for registration were filed and granted by the lower courts prior
to the promulgation of T.A.N. Properties.

In Republic v. Medida,37 the application for registration of the subject properties therein was filed on October 22, 2004 and was granted by the trial court on June 21, 2006. Similarly, in
Republic v. Jaralve,38 the application for registration of the subject property therein was filed on October 22, 1996 and was granted by the trial court on November 15, 2002. In the
foregoing cases, notwithstanding that the applications for registration were filed and granted by the trial courts prior to the promulgation of T.A.N. Properties, this Court applied the
pronouncements in T.A.N. Properties and denied the applications for registration on the ground, inter alia, that the applicants therein failed to present a copy of the original classification
approved by the DENR Secretary and certified by the legal custodian thereof as a true copy.

Anent the second and third requirements, the Court finds that the respondent failed to present sufficient evidence to prove that it and its predecessors-in-interest have been in open,
continuous, exclusive, and notorious possession and occupation of the subject properties since June 12, 1945, or earlier.

To prove that it and its predecessors-in-interest have been in possession and occupation of the subject properties since 1943, the respondent presented the testimony of Cerquena.
Cerquena testified that the subject properties were originally owned by Jaime who supposedly possessed and cultivated the same since 1943; that sometime in 1975, Jaime sold the
subject properties to Salvador and Mijares who, in turn, sold the same to the respondent in 1989.

The foregoing are but unsubstantiated and self-serving assertions of the possession and occupation of the subject properties by the respondent and its predecessors-in-interest; they do
not constitute the well-nigh incontrovertible evidence of possession and occupation of the subject properties required by Section 14(1) of P.D. No. 1529. Indeed, other than the
testimony of Cerquena, the respondent failed to present any other evidence to prove the character of the possession and occupation by it and its predecessors-in-interest of the subject
properties.

For purposes of land registration under Section 14(1) of P.D. No. 1529, proof of specific acts of ownership must be presented to substantiate the claim of open, continuous, exclusive,
and notorious possession and occupation of the land subject of the application. Applicants for land registration cannot just offer general statements which are mere conclusions of law
rather than factual evidence of possession. Actual possession consists in the manifestation of acts of dominion over it of such a nature as a party would actually exercise over his own
property.39

Although Cerquena testified that the respondent and its predecessors-in-interest cultivated the subject properties, by planting different crops thereon, his testimony is bereft of any
specificity as to the nature of such cultivation as to warrant the conclusion that they have been indeed in possession and occupation of the subject properties in the manner required by
law. There was no showing as to the number of crops that are planted in the subject properties or to the volume of the produce harvested from the crops supposedly planted thereon.

Further, assuming ex gratia argumenti that the respondent and its predecessors-in-interest have indeed planted crops on the subject properties, it does not necessarily follow that the
subject properties have been possessed and occupied by them in the manner contemplated by law. The supposed planting of crops in the subject properties may only have amounted
to mere casual cultivation, which is not the possession and occupation required by law.

"A mere casual cultivation of portions of the land by the claimant does not constitute possession under claim of ownership. For him, possession is not exclusive and notorious so as to
give rise to a presumptive grant from the state. The possession of public land, however long the period thereof may have extended, never confers title thereto upon the possessor
because the statute of limitations with regard to public land does not operate against the state, unless the occupant can prove possession and occupation of the same under claim of
ownership for the required number of years."40

Further, the Court notes that the tax declarations over the subject properties presented by the respondent were only for 2002. The respondent failed to explain why, despite its claim
that it acquired the subject properties as early as 1989, and that its predecessors-in-interest have been in possession of the subject property since 1943, it was only in 2002 that it
started to declare the same for purposes of taxation. "While tax declarations are not conclusive evidence of ownership, they constitute proof of claim of ownership."41 That the subject
properties were declared for taxation purposes only in 2002 gives rise to the presumption that the respondent claimed ownership or possession of the subject properties starting that
year. Likewise, no improvement or plantings were declared or noted in the said tax declarations. This fact belies the claim that the respondent and its predecessors-in-interest, contrary
to Cerquena's testimony, have been in possession and occupation of the subject properties in the manner required by law.

Having failed to prove that the subject properties form part of the alienable and disposable lands of the public domain and that it and its predecessors-in-interest have been in open,
continuous, exclusive, and notorious possession and occupation of the same since June 12, 1945, or earlier, the respondent's application for registration should be denied.1wphi1

WHEREFORE, in consideration of the foregoing disquisitions, the instant petition is GRANTED. The Decision dated November 10, 2011 of the Court of Appeals in CA-G.R. CV No.
90503, which affirmed the Decision dated May 16, 2007 of the Regional Trial Court of Pasig City, Branch 69, in Land Registration Case No. N-11465 is hereby REVERSED and SET
ASIDE. The Application for Registration of Remman Enterprises, Inc. in Land Registration Case No. N-11465 is DENIED for lack of merit.

SO ORDERED.

49. G.R. No. 179011

April 15, 2013

REY CASTIGADOR CATEDRILLA, Petitioner,

vs.
MARIO and MARGIE1 LAURON, Respondents.

DECISION

PERALTA, J.:

Assailed in this petition for review on certiorari is the Decision2 dated February 28, 2007 of the Court of Appeals ((A) in CA-G.R. SP No. 00939, as well as its Resolution3dated July 11,
2007 which denied petitioner's motion for reconsideration.

On February 12, 2003, petitioner Rey Castigador Catedrilla filed with the Municipal Trial Court (MTC) of Lambunao, Iloilo a Complaint4 for ejectment against the spouses Mario and
Margie Lauron alleging as follows: that Lorenza Lizada is the owner of a parcel of land known as Lot 183, located in Mabini Street, Lambunao, Iloilo, which was declared for taxation
purposes in her name under Tax Declaration No. 0363;5 that on February 13, 1972, Lorenza died and was succeeded to her properties by her sole heir Jesusa Lizada Losaes, who
was married to Hilarion Castigador (Castigador); that the spouses Jesusa and Hilarion Castigador had a number of children, which included Lilia Castigador (Lilia), who was married to
Maximo Catedrilla (Maximo); that after the death of the spouses Castigador, their heirs agreed among themselves to subdivide Lot 183 and, pursuant to a consolidation subdivision
plan6 dated January 21, 1984, the parcel of lot denominated as Lot No. 5 therein was to be apportioned to the heirs of Lilia since the latter already died on April 9, 1976; Lilia was
succeeded by her heirs, her husband Maximo and their children, one of whom is herein petitioner; that petitioner filed the complaint as a co-owner of Lot No. 5; that sometime in 1980,
respondents Mario and Margie Lauron, through the tolerance of the heirs of Lilia, constructed a residential building of strong materials on the northwest portion of Lot No. 5 covering an
area of one hundred square meters; that the heirs of Lilia made various demands for respondents to vacate the premises and even exerted earnest efforts to compromise with them but
the same was unavailing; and that petitioner reiterated the demand on respondents to vacate the subject lot on January 15, 2003, but respondents continued to unlawfully withhold such
possession.

In their Answer,7 respondents claimed that petitioner had no cause of action against them, since they are not the owners of the residential building standing on petitioner's lot, but
Mildred Kascher (Mildred), sister of respondent Margie, as shown by the tax declaration in Mildred's name;8 that in 1992, Mildred had already paid P10,000.00 as downpayment for the
subject lot to Teresito Castigador;9 that there were several instances that the heirs of Lilia offered the subject Lot 183 for sale to respondents and Mildred and demanded payment,
however, the latter was only interested in asking money without any intention of delivering or registering the subject lot; that in 1998, Maximo, petitioner's father, and respondent Margie
entered into an amicable settlement10 before the Barangay Lupon of Poblacion Ilawod, Lambunao, Iloilo wherein Maximo offered the subject lot to the spouses Alfons and Mildred
Kascher in the amount of P90,000.00 with the agreement that all documents related to the transfer of the subject lot to Maximo and his children be prepared by Maximo, but the latter
failed to comply; and that the amicable settlement should have the force and effect of a final judgment of a court, hence, the instant suit is barred by prior judgment. Respondents
counterclaimed for damages.

On November 14, 2003, the MTC rendered its Decision,11 the dispositive portion of which reads:

WHEREFORE, in view of the foregoing, judgment is hereby rendered in favor of the plaintiff ordering the defendants:

1. To vacate the lot in question and restore possession to the plaintiff;

2. To pay plaintiff in the reduced amount of TWENTY THOUSAND PESOS (P20,000.00) as Atty's fees, plus ONE THOUSAND (P1,000.00) per Court appearance;

3. To pay plaintiff reasonable compensation for the use of the lot in question ONE THOUSAND (P1,000.00) pesos yearly counted from the date of demand;

4. To pay the cost of litigation.

No award of moral and exemplary damages.

Defendants' counterclaim is hereby dismissed for lack of sufficient evidence.12

The MTC found that from the allegations and evidence presented, it appeared that petitioner is one of the heirs of Lilia Castigador Catedrilla, the owner of the subject lot and that
respondents are occupying the subject lot; that petitioner is a party who may bring the suit in accordance with Article 48713 of the Civil Code; and as a co-owner, petitioner is allowed to
bring this action for ejectment under Section 1, Rule 7014 of the Rules of Court; that respondents are also the proper party to be sued as they are the occupants of the subject lot which
they do not own; and that the MTC assumed that the house standing on the subject lot has been standing thereon even before 1992 and only upon the acquiescence of the petitioner
and his predecessor-in-interest.

The MTC found that respondents would like to focus their defense on the ground that Mildred is an indispensable party, because she is the owner of the residential building on the
subject lot and that there was already a perfected contract to sell between Mildred and Maximo because of an amicable settlement executed before the Office of the Punong Barangay.

However, the MTC, without dealing on the validity of the document and its interpretation, ruled that it was clear that respondent Margie was representing her parents, Mr. and Mrs.
Bienvenido Loraa, in the dispute presented with the Punong Barangay. It also found that even Mildred's letter to petitioner's father Maximo recognized the title of petitioner's father over
the subject lot and that it had not been established by respondents if Teresito Castigador, the person who signed the receipt evidencing Mildred's downpayment of P10,000.00 for the
subject lot, is also one of the heirs of Lilia. The MTC concluded that respondents could not be allowed to deflect the consequences of their continued stay over the property, because it
was their very occupation of the property which is the object of petitioner's complaint; that in an action for ejectment, the subject matter is material possession or possession de facto
over the real property, and the side issue of ownership over the subject lot is tackled here only for the purpose of determining who has the better right of possession which is to prove
the nature of possession; that possession of Lot 183 should be relinquished by respondents to petitioner, who is a co-owner, without foreclosing other remedies that may be availed
upon by Mildred in the furtherance of her supposed rights.

Respondents filed their appeal with the Regional Trial Court (RTC) of Iloilo City, raffled off to Branch 26. On March 22, 2005, the RTC rendered its Order,15 the dispositive portion of
which reads:

WHEREFORE, circumstances herein-above considered, the decision of the court dated November 14, 2003 is hereby AFFIRMED, except for the payment of P20,000.00 as attorney's
fees.

SO ORDERED.16

The RTC found that petitioner, being one of the co-owners of the subject lot, is the proper party in interest to prosecute against any intruder thereon. It found that the amicable
settlement signed and executed by the representatives of the registered owner of the premises before the Lupon is not binding and unenforceable between the parties. It further ruled
that even if Mildred has her name in the tax declaration signifying that she is the owner of the house constructed on the subject lot, tax declarations are not evidence of ownership but
merely issued to the declarant for purposes of payment of taxes; that she cannot be considered as an indispensable party in a suit for recovery of possession against respondents; that
Mildred should have intervened and proved that she is an indispensable party because the records showed that she was not in actual possession of the subject lot. The RTC deleted
the attorney's fees, since the MTC decision merely ordered the payment of attorney's fees without any basis.

Respondents' motion for reconsideration was denied in an Order17 dated June 8, 2005.

Dissatisfied, respondents filed with the CA a petition for review. Petitioner filed his Comment thereto.

On February 28, 2007, the CA issued its assailed decision, the dispositive portion of which reads:

IN LIGHT OF ALL THE FOREGOING, this petition for review is GRANTED. The assailed decision of the Regional Trial Court, Br. 26, Iloilo City, dated March 22, 2005, that affirmed the
MTC Decision dated November 14, 2003, is REVERSED and SET ASIDE.

Consequently, the complaint for ejectment of the respondent is DISMISSED.18

The CA found that only petitioner filed the case for ejectment against respondents and ruled that the other heirs should have been impleaded as plaintiffs citing Section 1,19 Rule 7 and
Section 7,20 Rule 3 of the Rules of Court; that the presence of all indispensable parties is a condition sine qua non for the exercise of judicial power; that when an indispensable party is
not before the court, the action should be dismissed as without the presence of all the other heirs as plaintiffs, the trial court could not validly render judgment and grant relief in favor of
the respondents.

The CA also ruled that while petitioner asserted that the proper parties to be sued are the respondents as they are the actual possessors of the subject lot and not Mildred, petitioner still
cannot disclaim knowledge that it was to Mildred to whom his co-owners offered the property for sale, thus, he knew all along that the real owner of the house on the subject lot is
Mildred and not respondents; that Mildred even paid P10,000.00 out of the total consideration for the subject lot and required respondents' relatives to secure the documents that
proved their ownership over the subject lot; that Maximo and Mildred had previously settled the matter regarding the sale of the subject lot before the Barangay as contained in an
amicable settlement signed by Maximo and respondent Margie. Thus, the question in this case extends to mere possessory rights and non-inclusion of indispensable parties made the
complaint fatally defective. From the facts obtaining in this case, ejectment being a summary remedy is not the appropriate action to file against the alleged deforciant of the property.

Hence, this petition for review wherein petitioner raises the following issues:

THE COURT OF APPEALS ERRED AND GRAVELY ABUSED ITS DISCRETION WHEN IT HELD THAT THE DECISION OF THE TRIAL COURT WAS A NULLITY .

II

THE COURT OF APPEALS ERRED AND GRAVELY ABUSED ITS DISCRETION WHEN IT HELD THAT PETITIONER KNEW ALL ALONG THAT MILDRED KASCHER, AND NOT
RESPONDENTS, WERE THE REAL OWNERS OF THE RESIDENTIAL BUILDING.21

The CA found that petitioner's co-heirs to the subject lot should have been impleaded as co-plaintiffs in the ejectment case against respondents, since without their presence, the trial
court could not validly render judgment and grant relief in favor of petitioner.

We do not concur.

Petitioner can file the action for ejectment without impleading his co-owners. In Wee v. De Castro,22 wherein petitioner therein argued that the respondent cannot maintain an action for
ejectment against him, without joining all his co-owners, we ruled in this wise:

Article 487 of the New Civil Code is explicit on this point:

ART. 487. Any one of the co-owners may bring an action in ejectment.

This article covers all kinds of action for the recovery of possession, i.e., forcible entry and unlawful detainer (accion interdictal), recovery of possession (accion publiciana), and
recovery of ownership (accion de reivindicacion). As explained by the renowned civilest, Professor Arturo M. Tolentino:

A co-owner may bring such an action, without the necessity of joining all the other co-owners as co-plaintiffs, because the suit is deemed to be instituted for the benefit of all. If the
action is for the benefit of the plaintiff alone, such that he claims possession for himself and not for the co-ownership, the action will not prosper.

In the more recent case of Carandang v. Heirs of De Guzman, this Court declared that a co-owner is not even a necessary party to an action for ejectment, for complete relief can be
afforded even in his absence, thus:

In sum, in suits to recover properties, all co-owners are real parties in interest. However, pursuant to Article 487 of the Civil Code and the relevant jurisprudence, any one of them may
bring an action, any kind of action for the recovery of co-owned properties. Therefore, only one of the co-owners, namely the co-owner who filed the suit for the recovery of the coowned property, is an indispensable party thereto. The other co-owners are not indispensable parties. They are not even necessary parties, for a complete relief can be afforded in the
suit even without their participation, since the suit is presumed to have been filed for the benefit of all co-owners.23

In this case, although petitioner alone filed the complaint for unlawful detainer, he stated in the complaint that he is one of the heirs of the late Lilia Castigador, his mother, who inherited
the subject lot, from her parents. Petitioner did not claim exclusive ownership of the subject lot, but he filed the complaint for the purpose of recovering its possession which would
redound to the benefit of the co-owners. Since petitioner recognized the existence of a co-ownership, he, as a co-owner, can bring the action without the necessity of joining all the other
co-owners as co-plaintiffs.

Petitioner contends that the CA committed a reversible error in finding that Mildred Kascher is an indispensable party and that her non-inclusion as a party defendant in the ejectment
case made the complaint fatally defective, thus, must be dismissed.

We agree with petitioner.

The CA based its findings that Mildred is an indispensable party because it found that petitioner knew all along that Mildred is the owner of the house constructed on the subject lot as
shown in the affidavits24 of Maximo and petitioner stating that petitioner's co-owners had offered for sale the subject lot to Mildred, and that Maximo, petitioner's father, and Mildred had
previously settled before the Barangay the matter regarding the sale of the subject lot to the latter as contained in the amicable settlement.

We find that the affidavits of Maximo and petitioner merely stated that the lot was offered for sale to Mildred, but nowhere did it admit that Mildred is the owner of the house constructed
on the subject lot.

Also, it appears that the amicable settlement25 before the Barangay wherein it was stated that Maximo will sell the subject lot to the spouses Alfons and Mildred Kascher was signed by
Maximo on behalf of his children and respondent Margie on behalf of Mr. and Mrs. Bienvenido Loraa. Thus, there is no basis for the CA's conclusion that it was Mildred and Maximo
who had previously settled the sale of the subject lot.

Moreover, it appears however, that while there was a settlement, Liah C. Catedrilla, one of petitioner's co-heirs, wrote a letter26 dated October 30, 2002, to the Spouses Loraa and
respondent Margie stating that the latter had made a change on the purchase price for the subject lot which was different from that agreed upon in the amicable settlement. Records
neither show that respondent Margie had taken steps to meet with Liah or any of her co-heirs to settle the matter of the purchase price nor rebut such allegation in the letter if it was not
true. The letter27 dated July 5, 2003 of respondent Margie's counsel addressed to petitioner's counsel, stating that his client is amenable in the amount as proposed in the amicable
settlement, would not alter the fact of respondents' non-compliance with the settlement since the letter was sent after the ejectment case had already been filed by petitioner.

In Chavez v. Court of Appeals,28 we explained the nature of the amicable settlement reached after a barangay conciliation, thus:

Indeed, the Revised Katarungang Pambarangay Law provides that an amicable settlement reached after barangay conciliation proceedings has the force and effect of a final judgment
of a court if not repudiated or a petition to nullify the same is filed before the proper city or municipal court within ten (10) days from its date. It further provides that the settlement may
be enforced by execution by the lupong tagapamayapa within six (6) months from its date, or by action in the appropriate city or municipal court, if beyond the six-month period. This
special provision follows the general precept enunciated in Article 2037 of the Civil Code, viz.:

A compromise has upon the parties the effect and authority of res judicata; but there shall be no execution except in compliance with a judicial compromise.1wphi1

Thus, we have held that a compromise agreement which is not contrary to law, public order, public policy, morals or good customs is a valid contract which is the law between the
parties themselves. It has upon them the effect and authority of res judicata even if not judicially approved, and cannot be lightly set aside or disturbed except for vices of consent and
forgery.

However, in Heirs of Zari, et al. v. Santos, we clarified that the broad precept enunciated in Art. 2037 is qualified by Art. 2041 of the same Code, which provides:

If one of the parties fails or refuses to abide by the compromise, the other party may either enforce the compromise or regard it as rescinded and insist upon his original demand.

We explained, viz.:

Before the onset of the new Civil Code, there was no right to rescind compromise agreements. Where a party violated the terms of a compromise agreement, the only recourse open to
the other party was to enforce the terms thereof.

When the new Civil Code came into being, its Article 2041 x x x created for the first time the right of rescission. That provision gives to the aggrieved party the right to "either enforce the
compromise or regard it as rescinded and insist upon his original demand." Article 2041 should obviously be deemed to qualify the broad precept enunciated in Article 2037 that "a
compromise has upon the parties the effect and authority of res judicata.

In exercising the second option under Art. 2041, the aggrieved party may, if he chooses, bring the suit contemplated or involved in his original demand, as if there had never been any
compromise agreement, without bringing an action for rescission. This is because he may regard the compromise as already rescinded by the breach thereof of the other party.29

While the amicable settlement executed between Maximo and respondent Margie before the Barangay had the force and effect of a final judgment of a court, it appears that there was
non-compliance thereto by respondent Margie on behalf of her parents which may be construed as repudiation. The settlement is considered rescinded in accordance with the provision
of Article 2041 of the Civil Code. Since the settlement was rescinded, petitioner, as a co-owner, properly instituted the action for ejectment to recover possession of the subject lot
against respondents who are in possession of the same.

Even the receipt30 signed by a certain Teresito Castigador, acknowledging having received from Mildred the amount of P10,000.00 as downpayment for the purchase of the subject lot,
would not also prove respondents' allegation that there was already a perfected contract to sell the subject lot to Mildred, since the authority of Teresito to sell on behalf of the heirs of
Lilia Castigador was not established.

In ejectment cases, the only issue to be resolved is who is entitled to the physical or material possession of the property involved, independent of any claim of ownership set forth by
any of the party-litigants.31 In an action for unlawful detainer, the real party-in-interest as party-defendant is the person who is in possession of the property without the benefit of any
contract of lease and only upon the tolerance and generosity of its owner.32 Well settled is the rule that a person who occupies the land of another at the latters tolerance or
permission, without any contract between them, is bound by an implied promise that he will vacate the same upon demand, failing which a summary action for ejectment is the proper
remedy against him.33 His status is analogous to that of a lessee or tenant whose term of lease has expired but whose occupancy continued by tolerance of the owner.34

Here, records show that the subject lot is owned by petitioner's mother, and petitioner, being an heir and a co-owner, is entitled to the possession of the subject lot. On the other hand,
respondent spouses are the occupants of the subject lot which they do not own. Respondents' possession of the subject lot was without any contract of lease as they failed to present
any, thus lending credence to petitioner's claim that their stay in the subject lot is by mere tolerance of petitioner and his predecessors.1wphi1 It is indeed respondents spouses who
are the real parties-in-interest who were correctly impleaded as defendants in the unlawful detainer case filed by petitioner.

WHEREFORE, premises considered, the petition is hereby GRANTED. The Decision dated February 28, 2007 and the Resolution dated July 11, 2007 of the Court of Appeals are
hereby REVERSED and SET ASIDE. The Order dated March 22, 2005 of the Regional Trial Court, Branch 26, Iloilo City, in Civil Case No. 04-27978, is hereby REINSTATED.

SO ORDERED.

50. G.R. No. 200667

March 11, 2013

RURAL BANK OF STA. BARBARA (ILOILO), INC., Petitioner,

vs.
GERRY CENTENO, Respondent.

RESOLUTION

PERLAS-BERNABE, J.:

Assailed in this Petition for Review on Certiorari1 is the January 31, 2012 Decision2 of the Cebu City Court of Appeals (CA) in CA-G.R. CV No. 78398 which set aside the October 8,
2002 Decision of the Regional Trial Court of Barotac Viejo, Iloilo City, Branch -66 (RTC} in Cadastral Case No. 98-0693 and denied the issuance of a writ of possession for Cadastral
Lot Nos. 964, 958 and 959 of the Ajuy, Iloilo Cadastre (subject lots) in

petitioner's favor.

The Facts

Spouses Gregorio and Rosario Centeno (Sps. Centeno) were the previous owners of the subject lots. During that time, they mortgaged the foregoing properties in favor of petitioner
Rural Bank of Sta. Barbara (Iloilo), Inc. as security for a P1,753.65 loan. Sps. Centeno, however, defaulted on the loan, prompting petitioner to cause the extrajudicial foreclosure of the
said mortgage. Consequently, the subject lots were sold to petitioner being the highest bidder at the auction sale. On October 10, 1969, it obtained a Certificate of Sale at Public
Auction4 which was later registered with the Register of Deeds of Iloilo City on December 13, 1971.5

Sps. Centeno failed to redeem the subject lots within the one (1) year redemption period pursuant to Section 66 of Act No. 3135.7 Nonetheless, they still continued with the possession
and cultivation of the aforesaid properties. Sometime in 1983, respondent Gerry Centeno, son of Sps. Centeno, took over the cultivation of the same. On March 14, 1988, he purchased
the said lots from his parents. Accordingly, Rosario Centeno paid the capital gains taxes on the sale transaction and tax declarations were eventually issued in the name of
respondent.8 While the latter was in possession of the subject lots, petitioner secured on November 25, 1997 a Final Deed of Sale thereof and in 1998, was able to obtain the
corresponding tax declarations in its name.9

On March 19, 1998, petitioner filed a petition for the issuance of a writ of possession before the RTC, claiming entitlement to the said writ by virtue of the Final Deed of Sale covering the
subject lots.10 Respondent opposed the petition, asserting that he purchased and has, in fact, been in actual, open and exclusive possession of the same properties for at least fifteen
(15) years.11 He further averred that the foreclosure sale was null and void owing to the forged signatures in the real estate mortgage. Moreover, he claims that petitioners rights over
the subject lots had already prescribed.12

Ruling of the RTC

On October 8, 2002, the RTC rendered its Decision13 in Cadastral Case No. 98-069, finding petitioner to be the lawful owner of the subject lots whose rights became absolute due to
respondents failure to redeem the same. Consequently, it found the issuance of a writ of possession ministerial on its part.14 Dissatisfied, respondent appealed to the CA.

Ruling of the CA

The CA, through its January 31, 2012 Decision,15 reversed the RTC and ruled against the issuance of a writ of possession. It considered respondent as a third party who is actually
holding the property adverse to the judgment obligor and as such, has the right to ventilate his claims in a proper judicial proceeding i.e., an ejectment suit or reinvindicatory action.16

Aggrieved, petitioner filed the instant petition.

Issue Before The Court

The sole issue in this case is whether or not petitioner is entitled to a writ of possession over the subject lots.

The Courts Ruling

The petition is meritorious.

It is well-established that after consolidation of title in the purchasers name for failure of the mortgagor to redeem the property, the purchasers right to possession ripens into the
absolute right of a confirmed owner. At that point, the issuance of a writ of possession, upon proper application and proof of title, to a purchaser in an extrajudicial foreclosure sale
becomes merely a ministerial function, 17 unless it appears that the property is in possession of a third party claiming a right adverse to that of the mortgagor.18 The foregoing rule is
contained in Section 33, Rule 39 of the Rules of Court which partly provides:

Sec. 33. Deed and possession to be given at expiration of redemption period; by whom executed or given.

xxxx

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 as of the time of the 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. (Emphasis and underscoring supplied)

In China Banking Corporation v. Lozada,19 the Court held that the phrase "a third party who is actually holding the property adversely to the judgment obligor" contemplates a situation
in which a third party holds the property by adverse title or right, such as that of a co-owner, tenant or usufructuary. The co-owner, agricultural tenant, and usufructuary possess the
property in their own right, and they are not merely the successor or transferee of the right of possession of another co-owner or the owner of the property.20 Notably, the property
should not only be possessed by a third party, but also held by the third party adversely to the judgment obligor.21

In this case, respondent acquired the subject lots from his parents, Sps. Centeno, on March 14, 1988 after they were purchased by petitioner and its Certificate of Sale at Public Auction
was registered with the Register of Deeds of Iloilo City in 1971. It cannot therefore be disputed that respondent is a mere successor-in-interest of Sps. Centeno. Consequently, he
cannot be deemed as a "third party who is actually holding the property adversely to the judgment obligor" under legal contemplation. Hence, the RTC had the ministerial duty to issue
as it did issue the said writ in petitioners favor.

On the issue regarding the identity of the lots as raised by respondent in his Comment,22 records show that the RTC had already passed upon petitioners title over the subject lots
during the course of the proceedings. Accordingly, the identity of the said lots had already been established for the purpose of issuing a writ of possession. It is hornbook principle that
absent any clear showing of abuse, arbitrariness or capriciousness committed by the lower court, its findings of facts are binding and conclusive upon the Court,23 as in this
case.1wphi1

Finally, anent the issue of laches, it must be maintained that the instant case only revolves around the issuance of a writ of possession which is merely ministerial on the RTC's part as
above-explained. As such, all defenses which respondent may raise including that of laches should be ventilated through a proper proceeding.

WHEREFORE, the petition is GRANTED. The January 31, 2012 Decision of the Cebu City Court of Appeals in CA-G.R. CV No. 78398 is REVERSED and SET ASIDE. Accordingly, the
October 8, 2002 Decision of the Regional Trial Court of Barotac Viejo, Iloilo City, Branch 66 in Cadastral Case No. 98-069 is hereby REINSTATED.

SO ORDERED.

ESTELA M. PERLAS-BERNABE
Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

ARTURO D. BRION

MARIANO C. DEL CASTILLO

Associate Justice

Associate Justice

MARTIN S. VILLARAMA, JR.*

Associate Justice

ATTESTATION

I attest that the conclusions in the above Resolution had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13; Article VIII of the Constitution, and the Division Chairperson's Attestation, I certify that the conclusions in the above Resolution had been reached in consultation
before the case was assigned to the writer of the opinion of the Court's Division.

MARIA LOURDES P. A. SERENO

51. [G.R. No. 185518, April 17, 2013]

SPOUSES FELIX CHINGKOE AND ROSITA CHINGKOE, Petitioners, v. SPOUSES FAUSTINO CHINGKOE AND GLORIA CHINGKOE, Respondents.

DECISION

ERENO, C.J.:

This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the 3 July 2008 Decision of the Court of Appeals (CA) annulling the 30 March 2007 Decision o(the
Regional Trial Court (RTC) of Quezon City.1 The RTC affirmed2 the Metropolitan Trial Court's (MTC) dismissal3 of the Complaint for unlawful detainer filed by herein respondents.
The facts, as culled from the records, are as follows:cralaw
Respondents are the registered owners of a real property covered by Transfer Certificate of Title No. 82834 of the Registry of Deeds of Quezon City. They claim that sometime in 1990,
out of tolerance and permission, they allowed respondent Faustinos brother, Felix, and his wife, Rosita, to inhabit the subject property situated at No. 58 Lopez Jaena Street, Ayala
Heights, Quezon City. Due to the intercession of their mother, Tan Po Chu, Faustino agreed to sell the property to Felix on condition that the title shall be delivered only after Felix and
Rositas payment of the full purchase price, and after respondents settlement of their mortgage obligations with the Rizal Commercial Banking Corporation (RCBC). After further
prodding from their mother, however, and at Felixs request, Faustino agreed to deliver in advance an incomplete draft of a Deed of Absolute Sale, which had not yet been notarized.
While respondents themselves drafted the deed, the parties again agreed that the document would only be completed after full payment.5cralawvllred
On 24 July 2001, respondents sent a demand letter6 to petitioners asking them to vacate the premises. To this date, petitioners have refused to do so, prompting respondents to file a
complaint7 for unlawful detainer with the MTC of Quezon City. In their Answer, petitioners presented a copy of a completed Deed of Absolute Sale dated 10 October 1994, claiming that
respondents had sold the property for P3,130,000, which petitioners had paid in full and in cash on the same day. Due to respondents adamant refusal to surrender the title to them as
buyers, petitioners were allegedly constrained to file an action for specific performance with Branch 96 of the Quezon City RTC on 31 January 1995.8cralawvllred
The MTC gave weight to the Deed of Sale presented by petitioners and dismissed the Complaint, as follows:chanroblesvirtuallawlibrary
The defendants herein assert that since October 1994, when they bought their property in CASH, their stay thereat is by virtue of their absolute ownership thereof as provided for in the
Absolute Deed of Sale, x x x. The foregoing would right away tell us that this Court is barred from ordering the ejectment of the defendants from the premises in question so much so
that what is at stake only in cases of this nature as above stated is as regards possession only.
With the execution of the Deed of Absolute Sale whereby the Vendors never reserved their rights and interests over the property after the sale, and the transfer appears to be absolute,
beside the fact that the property is now under the control and custody of the defendants, we could conclude that instant case unlawful detainer (sic) is destined to fail,9 x x x.
The RTC affirmed the findings of the MTC in toto, reasoning thus:chanroblesvirtuallawlibrary
x x x (T)here exists a Deed presented in evidence on the sale of the subject property entered into by the herein parties. The Deed of Sale renders weak the claim of tolerance or
permission.
Although the plaintiffs-appellants questioned the validity and authenticity of the Deed of Sale, this will not change the nature of the action as an unlawful detainer, in the light of our
premise of the principal issue in unlawful detainer possession de facto.10
The CA reversed the findings of the lower courts and ruled that a mere plea of title over disputed land by the defendant cannot be used as sound basis for dismissing an action for
recovery of possession. Citing Refugia v. Court of Appeals, the appellate court found that petitioners stay on the property was merely a tolerated possession, which they were no longer
entitled to continue. The deed they presented was not one of sale, but a document preparatory to an actual sale, prepared by the petitioners upon the insistence and prodding of their
mother to soothe in temper respondent Felix Chingkoe.11cralawvllred
Petitioners now come before this Court, raising the following arguments:cralaw

a.

The CA committed reversible error when it admitted and gave weight to testimony given in a different proceeding (action for specific performance) pending before the
Regional Trial Court in resolving the issue herein (unlawful detainer); and

b.

The CA committed reversible error when it ruled on the validity of a notarized Deed of Sale in a summary ejectment action.

We deny the petition.

Anent the first argument, petitioners fault the CA for citing and giving credence to the testimony of Tan Po Chu, who was presented as a witness in another case, the action for specific
performance filed by petitioners. The CA stated:chanroblesvirtuallawlibrary
In the case instituted by the respondents against herein petitioner for Specific Performance entitled <I>Felix Chingkoe and Rosita Chingkoe v. Faustino Chingkoe and Gloria
Chingkoe,</I> docketed as Civil Case No. Q-95-22865 pending before Branch 96 of the Regional Trial Court of Quezon City, Tan Po Chu testified on 25 November 1999 to shed light
on the matter once and for all, to wit:
xxxx
Atty. Nicolas:
Q

You mentioned that this is the second copy of the deed of absolute sale, you identified the signature appearing here as the signature of Felix, how do you know that
this is the signature of Felix?

Well, he is my son. I am familiar with his signature and besides that he signed it in my presence.

And this is the very document and not as photocopy (sic) of the second document which you brought to Felix?

Atty. Flores:
Again, Your Honor, very leading.
Court:
I will allow.
A

I am not very sure now but I think this is the real one, I think this is the one because I saw him signed (sic) this.

Atty. Nicolas:
May I request that this be marked as Exhibit 1 and the signature of Felix be signed as Exhibit 1-A?
Court:
Mark.
Atty. Flores:
Just a moment, no basis, Your Honor, please.
Atty. Nicolas:
Your Honor, the witness said that there was a deed of absolute sale, I was asking if she knows how much Felix paid for the property when she delivered the
document.
Court:
She never testified that there was a sale, she only said that there was a deed of sale.
Atty. Nicolas:
I will reform, Your Honor.
Q

When you delivered this document to Felix, what did he give you in return, if any?

He did not give me anything, he had never paid me any single cent.

When you delivered the deed of sale?

There was no payment whatsoever.

As far as you know, Ms. Witness, was the property paid for by Felix to Faustino?

I swear to God, no payment, there was no payment at all, I swear.

xxxx
As clearly shown in the testimony given in open court which was above-quoted, petitioners merely delivered to their mother a draft of the deed, which they signed to
appease her and respondent Felix Chingkoe.12 (Emphases supplied.)
The CA indeed quoted at length from the testimony of Tan Po Chu, and culled therefrom the factual finding that the purported contract of sale had never been consummated between
the parties. The CA cited as basis her testimony from Civil Case No. Q-95-22865: that she witnessed Felix signing the blank deed, and that upon its signing, there was no payment for
the property. This account directly contradicts petitioners claim that payment was made simultaneously with the perfection of the contract.

Petitioners claim that the CA erroneously considered this testimony in Civil Case No. Q-95-22865. They cite the general rule that courts are not authorized to take judicial notice of the
contents of the records of other cases. This rule, however, admits of exceptions. As early as United States v. Claveria, this Court has stated: In the absence of objection and as a
matter of convenience, a court may properly treat all or part of the original record of a former case filed in its archives, as read into the record of a case pending before it, when, with the
knowledge of the opposing party, reference is made to it for that purpose by name and number or in some other manner by which it is sufficiently designated.13cralawvllred
We reiterated this stance in Adiarte v. Domingo,14 in which the trial court decided the action pending before it by taking judicial notice of the records of a prior case for a sum of money.
The Supreme Court affirmed the trial courts dismissal of the Complaint, after it considered evidence clearly showing that the subject matter thereof was the same as that in the prior
litigation. In a 1993 case, Occidental Land Transportation Company, Inc. v. Court of Appeals, the Court ruled:chanroblesvirtuallawlibrary
The reasons advanced by the respondent court in taking judicial notice of Civil Case No. 3156 are valid and not contrary to law. As a general rule, courts are not authorized to take
judicial notice, in the adjudication of cases pending before them, of the contents of the records of other cases, even when such cases have been tried or are pending in the same court,
and notwithstanding the fact that both cases may have been heard or are actually pending before the same judge. The general rule admits of exceptions as enumerated in Tabuena v.
Court of Appeals, the Court, citing U.S. v. Claveria, which We quote:cralaw
x x x (I)n the absence of objection, and as a matter of convenience to all parties, a court may properly treat all or any part of the original record of a case filed in its archives as read into
the record of a case pending before it, when, with the knowledge of the opposing party, reference is made to it for that purpose, by name and number or in some other manner by which
it is sufficiently designated; or when the original record of the former case or any part of it, is actually withdrawn from the archives by the court's direction, at the request or with the
consent of the parties, and admitted as a part of the record of the case then pending.
It is clear, though, that this exception is applicable only when, in the absence of objection, with the knowledge of the opposing party, or at the request or with the
consent of the parties the case is clearly referred to or the original or part of the records of the case are actually withdrawn from the archives' and 'admitted as part of the
record of the case then pending.
xxxx
And unlike the factual situation in Tabuena v. CA, the decision in Civil Case No. 3156 formed part of the records of the instant case (Civil Case No. 2728) with the
knowledge of the parties and in the absence of their objection. (Emphases supplied, citations omitted).15
This doctrine was restated in Republic v. Sandiganbayan, viz: As a matter of convenience to all the parties, a court may properly treat all or any part of the original record of a case filed
in its archives as read into the record of a case pending before it, when, with the knowledge of, and absent an objection from, the adverse party, reference is made to it for that purpose,
by name and number or in some other manner by which it is sufficiently designated; or when the original record of the former case or any part of it, is actually withdrawn from the
archives at the courts direction, at the request or with the consent of the parties, and admitted as a part of the record of the case then pending.16 (Underscoring supplied)
In the case at bar, as the CA rightly points out in its Resolution dated 28 November 2008,17 petitioners never objected to the introduction of the Transcript of Stenographic Notes
containing the testimony of Tan Po Chu, which were records of Civil Case No. Q-95-22865. As shown by the records and as petitioners admitted in their Reply, the testimony was
already introduced on appeal before the RTC. In fact, it was petitioners themselves who specifically cited Civil Case No. Q-95-22865, referring to it both by name and number,
purportedly to bolster the claim that they were constrained to sue, in order to compel delivery of the title.18cralawvllred
Given these facts, the CA committed no reversible error in taking judicial notice of the records of Civil Case No. Q-95-22865. In any case, the said testimony was not the only basis for
reversing the RTCs Decision. Independent of the testimony, the CA through its perusal and assessment of other pieces of evidence, specifically the Deed of Absolute Sale
concluded that petitioners stay on the premises had become unlawful.
Concerning the second issue, petitioners object to the assessment of the Deed of Sale by the CA, claiming such a determination is improper in summary proceedings. It should be
noted that it was petitioners who introduced the Deed of Sale in evidence before the MTC and the RTC, as evidence of their claimed right to possession over the property. They
attached the deed to their Answer as Annex 1.19 The CA discovered that they falsified their copy of the document denominated as Deed of Absolute Sale in this
wise:chanroblesvirtuallawlibrary
Said draft of the deed was undated and bears the signature of one witness, as can be clearly noticed upon its very careful perusal. Notably, respondents made it appear in the draft of
the Deed of Absolute Sale that there indeed was a valid and consummated sale when in truth and in fact, there was none. The document accomplished by the respondents (herein

petitioners) gave them some semblance, albeit highly questionable, of ownership over the property by affixing their signatures, affixing the signature of one Cora Hizon as witness and
superimposing the signature of Jane Chan with that of one Noralyn Collado.20
Batas Pambansa Blg. 129 states that when the defendant raises the question of ownership in unlawful detainer cases and the question of possession cannot be resolved without
deciding the issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession.21 This Court has repeatedly ruled that although the issue in
unlawful detainer cases is physical possession over a property, trial courts may provisionally resolve the issue of ownership for the sole purpose of determining the issue of
possession.22 These actions are intended to avoid disruption of public order by those who would take the law in their hands purportedly to enforce their claimed right of possession. In
these cases, the issue is pure physical or de facto possession, and pronouncements made on questions of ownership are provisional in nature. The provisional determination of
ownership in the ejectment case cannot be clothed with finality."23cralawvllred
Trial courts must necessarily delve into and weigh the evidence of the parties in order to rule on the right of possession, as we have discussed in Sps. Esmaquel and Sordevilla v.
Coprada:chanroblesvirtuallawlibrary
In unlawful detainer cases, the possession of the defendant was originally legal, as his possession was permitted by the plaintiff on account of an express or implied contract between
them. However, defendant's possession became illegal when the plaintiff demanded that defendant vacate the subject property due to the expiration or termination of the right to
possess under their contract, and defendant refused to heed such demand.
The sole issue for resolution in an unlawful detainer case is physical or material possession of the property involved, independent of any claim of ownership by any of the parties. Where
the issue of ownership is raised by any of the parties, the courts may pass upon the same in order to determine who has the right to possess the property. The adjudication is, however,
merely provisional and would not bar or prejudice an action between the same parties involving title to the property. Since the issue of ownership was raised in the unlawful detainer
case, its resolution boils down to which of the parties' respective evidence deserves more weight.24 (Emphasis supplied, citations omitted.)
WHEREFORE, in view of the foregoing, we deny the instant Petition for lack of merit. The Decision of the Court of Appeals in CA-G.R. SP No. 100008 (dated 3 July 2008)
is AFFIRMED.
We make no pronouncement as to attorney's fees for lack of evidence.
SO ORDERED.

52. G.R. No. 169211

March 6, 2013

STAR TWO (SPV-AMC), INC.,1 Petitioner,

vs.
PAPER CITY CORPORATION OF THE PHILIPPINES, Respondent.

DECISION

PEREZ, J.:

For review before this Court is a Petition for Review on Certiorari filed by Rizal Commercial Banking Corporation now substituted by Star Two (SPV-AMC), Inc. by virtue of Republic Act
No. 91822 otherwise known as the "Special Purpose Vehicle Act of 2002," assailing the 8 March 2005 Decision and 8 August 2005 Resolution of the Special Fourth Division of the
Court of Appeals (CA) in CA-G.R. SP No. 82022 upholding the 15 August 2003 and 1 December 2003 Orders of the Valenzuela Regional Trial Court (RTC) ruling that the subject
machineries and equipments of Paper City Corporation (Paper City) are movable properties by agreement of the parties and cannot be considered as included in the extrajudicial
foreclosure sale of the mortgaged land and building of Paper City.3

The facts as we gathered from the records are:

Rizal Commercial Banking Corporation (RCBC), Metropolitan Bank and Trust Co. (Metrobank) and Union Bank of the Philippines (Union Bank) are banking corporations duly organized
and existing under the laws of the Philippines.

On the other hand, respondent Paper City is a domestic corporation engaged in the manufacture of paper products particularly cartons, newsprint and clay-coated paper.4

From 1990-1991, Paper City applied for and was granted the following loans and credit accommodations in peso and dollar denominations by RCBC: P10,000,000.00 on 8 January
1990,5 P14,000,000.00 on 19 July 1990,6P10,000,000.00 on 28 June 1991,7 and P16,615,000.00 on 28 November 1991.8 The loans were secured by four (4) Deeds of Continuing
Chattel Mortgages on its machineries and equipments found inside its paper plants.

On 25 August 1992, a unilateral Cancellation of Deed of Continuing Chattel Mortgage on Inventory of Merchandise/Stocks-in-Trade was executed by RCBC through its Branch
Operation Head Joey P. Singh and Asst. Vice President Anita O. Abad over the merchandise and stocks-in-trade covered by the continuing chattel mortgages.9

On 26 August 1992, RCBC, Metrobank and Union Bank (creditor banks with RCBC instituted as the trustee bank) entered into a Mortgage Trust Indenture (MTI) with Paper City. In the
said MTI, Paper City acquired an additional loan of One Hundred Seventy Million Pesos (P170,000,000.00) from the creditor banks in addition to the previous loan from RCBC
amounting to P110,000,000.00 thereby increasing the entire loan to a total of P280,000,000.00. The old loan of P110,000,000.00 was partly secured by various parcels of land covered
by TCT Nos. T-157743, V-13515, V-1184, V-1485, V-13518 and V-13516 situated in Valenzuela City pursuant to five (5) Deeds of Real Estate Mortgage dated 8 January 1990, 27
February 1990, 19 July 1990, 20 February 1992 and 12 March 1992.10 The new loan obligation of P170,000,000.00 would be secured by the same five (5) Deeds of Real Estate
Mortgage and additional real and personal properties described in an annex to MTI, Annex "B."11 Annex "B" of the said MTI covered the machineries and equipments of Paper City.12

The MTI was later amended on 20 November 1992 to increase the contributions of the RCBC and Union Bank toP80,000,000.00 and P70,000,000.00, respectively. As a consequence,
they executed a Deed of Amendment to MTI13 but still included as part of the mortgaged properties by way of a first mortgage the various machineries and equipments located in and
bolted to and/or forming part of buildings generally described as:

Annex "A"

A.

Office Building
Building 1, 2, 3, 4, and 5
Boiler House
Workers Quarter/Restroom
Canteen
Guardhouse, Parking Shed, Elevated Guard
Post and other amenities

B.

Pollution Tank Nos. 1 and 2.

Reserve Water Tank and Swimming Pool
Waste Water Treatment Tank
Elevated Concrete Water Tank
And other Improvements listed in Annex "A"

C.

Power Plants Nos. 1 and 2

Fabrication Building
Various Fuel, Water Tanks and Pumps
Transformers

Annex "B"

D.

D. Material Handling Equipment

Paper Plant No. 3

A Second Supplemental Indenture to the 26 August 1992 MTI was executed on 7 June 1994 to increase the amount of the loan from P280,000,000.00 to P408,900,000.00 secured
against the existing properties composed of land, building, machineries and equipments and inventories described in Annexes "A" and "B."14

Finally, a Third Supplemental Indenture to the 26 August 1992 MTI was executed on 24 January 1995 to increase the existing loan obligation of P408,900,000.00 to P555,000,000.00
with an additional security composed of a newly constructed two-storey building and other improvements, machineries and equipments located in the existing plant site.15

Paper City was able to comply with its loan obligations until July 1997. But economic crisis ensued which made it difficult for Paper City to meet the terms of its obligations leading to
payment defaults.16 Consequently, RCBC filed a Petition for Extrajudicial Foreclosure Under Act No. 3135 Against the Real Estate Mortgage executed by Paper City on 21 October
1998.17 This petition was for the extra-judicial foreclosure of eight (8) parcels of land including all improvements thereon enumerated as TCT Nos. V-9763, V-13515, V-13516, V-13518,
V-1484, V-1485, V-6662 and V-6663 included in the MTI dated 26 August 1992, Supplemental

MTI dated 20 November 1992, Second Supplemental Indenture on the MTI dated 7 June 1994 and Third Supplemental Indenture on the MTI dated 24 January 1995.18 Paper City then
had an outstanding obligation with the creditor banks adding up to Nine Hundred One Million Eight Hundred One Thousand Four Hundred Eighty-Four and 10/100 Pesos
(P901,801,484.10), inclusive of interest and penalty charges.19

A Certificate of Sale was executed on 8 February 1999 certifying that the eight (8) parcels of land with improvements thereon were sold on 27 November 1998 in the amount of Seven
Hundred Two Million Three Hundred Fifty-One Thousand Seven Hundred Ninety-Six Pesos and 28/100 (P702,351,796.28) in favor of the creditor banks RCBC, Union Bank and
Metrobank as the highest bidders.20

This foreclosure sale prompted Paper City to file a Complaint21 docketed as Civil Case No. 164-V-99 on 15 June 1999 against the creditor banks alleging that the extra-judicial sale of
the properties and plants was null and void due to lack of prior notice and attendance of gross and evident bad faith on the part of the creditor banks. In the alternative, it prayed that in
case the sale is declared valid, to render the whole obligation of Paper City as fully paid and extinguished. Also prayed for was the return of P5,000,000.00 as excessive penalty and the
payment of damages and attorneys fees.

In the meantime, Paper City and Union Bank entered into a Compromise Agreement which was later approved by the trial court on 19 November 2001. It was agreed that the share of
Union Bank in the proceeds of the foreclosure shall be up to 34.23% of the price and the remaining possible liabilities of Paper City shall be condoned by the bank. Paper City likewise
waived all its claim and counter charges against Union Bank and agreed to turn-over its proportionate share over the property within 120 days from the date of agreement.22

On the other hand, the negotiations between the other creditor banks and Paper City remained pending. During the interim, Paper City filed with the trial court a Manifestation with
Motion to Remove and/or Dispose Machinery on 18 December 2002 reasoning that the machineries located inside the foreclosed land and building were deteriorating. It posited that
since the machineries were not included in the foreclosure of the real estate mortgage, it is appropriate that it be removed from the building and sold to a third party.23

Acting on the said motion, the trial court, on 28 February 2003 issued an Order denying the prayer and ruled that the machineries and equipments were included in the annexes and
form part of the MTI dated 26 August 1992 as well as its subsequent amendments. Further, the machineries and equipments are covered by the Certificate of Sale issued as a
consequence of foreclosure, the certificate stating that the properties described therein with improvements thereon were sold to creditor banks to the defendants at public auction.24

Paper City filed its Motion for Reconsideration25 on 4 April 2003 which was favorably granted by the trial court in its Order dated 15 August 2003. The court justified the reversal of its
order on the finding that the disputed machineries and equipments are chattels by agreement of the parties through their inclusion in the four (4) Deeds of Chattel Mortgage dated 28
January 1990, 19 July 1990, 28 June 1991 and 28 November 1991. It further ruled that the deed of cancellation executed by RCBC on 25 August 1992 was not valid because it was
done unilaterally and without the consent of Paper City and the cancellation only refers to the merchandise/stocks-in-trade and not to machineries and equipments.26

RCBC in turn filed its Motion for Reconsideration to persuade the court to reverse its 15 August 2003 Order. However, the same was denied by the trial court through its 1 December
2003 Order reiterating the finding and conclusion of the previous Order.27

Aggrieved, RCBC filed with the CA a Petition for Certiorari under Rule 65 to annul the Orders dated 15 August 2003 and 1 December 2003 of the trial court,28 for the reasons that:

I. Paper City gave its conformity to consider the subject machineries and equipment as real properties when the president and Executive Vice President of Paper City
signed the Mortgage Trust Indenture as well as its subsequent amendments and all pages of the annexes thereto which itemized all properties that were mortgaged.29

II. Under Section 8 of Act No. 1508, otherwise known as "The Chattel Mortgage Law" the consent of the mortgagor (Paper City) is not required in order to cancel a chattel
mortgage. Thus the "Cancellation of Deed of Continuing Chattel Mortgage on Inventory of Merchandise/Stocks-in-Trade" dated August 25, 1992 is valid and binding on
the Paper City even assuming that it was executed unilaterally by petitioner RCBC.30

III. The four (4) Deeds of Chattel Mortgage that were attached as Annexes "A" to "D" to the December 18, 2003 "Manifestation with Motion to Remove and/or Dispose of
Machinery" were executed from January 8, 1990 until November 28, 1991. On the other hand, the "Cancellation of Deed of Continuing Chattel Mortgage" was executed

on August 25, 1992 while the MTI and the subsequent supplemental amendments thereto were executed from August 26, 1992 until January 24, 1995. It is of the
contention of RCBC that Paper Citys unreasonable delay of ten

(10) years in assailing that the disputed machineries and equipments were personal amounted to estoppel and ratification of the characterization that the same were real
properties.31

IV. The removal of the subject machineries or equipment is not among the reliefs prayed for by the Paper City in its June 11, 1999 Complaint. The Paper City sought the
removal of the subject machineries and equipment only when it filed its December 18, 2002 Manifestation with Motion to Remove and/or Dispose of Machinery.32

V. Paper City did not specify in its various motions filed with the respondent judge the subject machineries and equipment that are allegedly excluded from the
extrajudicial foreclosure sale.33

VI. The machineries and equipments mentioned in the four (4) Deeds of Chattel Mortgage that were attached on the Manifestation with Motion to Remove and/or Dispose
of Machinery are the same machineries and equipments included in the MTI and supplemental amendments, hence, are treated by agreement of the parties as real
properties.34

In its Comment,35 Paper City refuted the claim of RCBC that it gave its consent to consider the machineries and equipments as real properties. It alleged that the disputed properties
remained within the purview of the existing chattel mortgages which in fact were acknowledged by RCBC in the MTI particularly in Section 11.07 which reads:

Section 11.07. This INDENTURE in respect of the MORTGAGE OBLIGATIONS in the additional amount not exceeding TWO HUNDRED TWENTY MILLION SIX HUNDRED FIFTEEN
THOUSAND PESOS (P220,615,000.00) shall be registered with the Register of Deeds of Valenzuela, Metro Manila, apportioned based on the corresponding loanable value of the
MORTGAGED PROPERTIES, viz:

a. Real Estate Mortgage P206,815,000.00

b. Chattel Mortgage P13,800,000.0036

Paper City argued further that the subject machineries and equipments were not included in the foreclosure of the mortgage on real properties particularly the eight (8) parcels of land.
Further, the Certificate of Sale of the Foreclosed Property referred only to "lands and improvements" without any specification and made no mention of the inclusion of the subject
properties.37

In its Reply,38 RCBC admitted that there was indeed a provision in the MTI mentioning a chattel mortgage in the amount of P13,800,000.00. However, it justified that its inclusion in the
MTI was merely for the purpose of ascertaining the amount of the loan to be extended to Paper City.39 It reiterated its position that the machineries and equipments were no longer
treated as chattels but already as real properties following the MTI.40

On 8 March 2005, the CA affirmed41 the challenged orders of the trial court. The dispositive portion reads:

WHEREFORE, finding no grave abuse of discretion committed by public respondent, the instant petition is hereby DISMISSED for lack of merit. The assailed Orders dated 15 August
and 2 December 2003, issued by Hon. Judge Floro P. Alejo are hereby AFFIRMED. No costs at this instance.42

The CA relied on the "plain language of the MTIs:

Undoubtedly, nowhere from any of the MTIs executed by the parties can we find the alleged "express" agreement adverted to by petitioner. There is no provision in any of the parties
MTI, which expressly states to the effect that the parties shall treat the equipments and machineries as real property. On the contrary, the plain and unambiguous language of the
aforecited MTIs, which described the same as personal properties, contradicts petitioners claims.43

It was also ruled that the subject machineries and equipments were not included in the extrajudicial foreclosure sale. The claim of inclusion was contradicted by the very caption of the
petition itself, "Petition for Extra-Judicial Foreclosure of Real Estate Mortgage Under Act No. 3135 As Amended." It opined further that this inclusion was further stressed in the
Certificate of Sale which enumerated only the mortgaged real properties bought by RCBC without the subject properties.44

RCBC sought reconsideration but its motion was denied in the CAs Resolution dated 8 August 2005.

RCBC before this Court reiterated all the issues presented before the appellate court:

1. Whether the unreasonable delay of ten (10) years in assailing that the disputed machineries and equipments were personal properties amounted to estoppel on the
part of Paper City;

2. Whether the Cancellation of Deed of Continuing Mortgage dated 25 August 1992 is valid despite the fact that it was executed without the consent of the mortgagor
Paper City;

3. Whether the subsequent contracts of the parties such as Mortgage Trust Indenture dated 26 August 1992 as well as the subsequent supplementary amendments dated
20 November 1992, 7 June 1992, and 24 January 1995 included in its coverage of mortgaged properties the subject machineries and equipment; and

4. Whether the subject machineries and equipments were included in the extrajudicial foreclosure dated 21 October 1998 which in turn were sold to the creditor banks as
evidenced by the Certificate of Sale dated 8 February 1999.

We grant the petition.

By contracts, all uncontested in this case, machineries and equipments are included in the mortgage in favor of RCBC, in the foreclosure of the mortgage and in the consequent sale on
foreclosure also in favor of petitioner.

The mortgage contracts are the original MTI of 26 August 1992 and its amendments and supplements on 20 November 1992, 7 June 1994, and 24 January 1995. The clear agreements
between RCBC and Paper City follow:

The original MTI dated 26 August 1992 states that:

MORTGAGE TRUST INDENTURE

This MORTGAGE TRUST INDENTURE, executed on this day of August 26, 1992, by and between:

PAPER CITY CORPORATION OF THE PHILIPPINES, x x x hereinafter referred to as the "MORTGAGOR");

-and-

RIZAL COMMERCIAL BANKING CORPORATION, x x x (hereinafter referred to as the "TRUSTEE").

xxxx

WHEREAS, against the same mortgaged properties and additional real and personal properties more particularly described in ANNEX "B" hereof, the MORTGAGOR desires to
increase their borrowings to TWO HUNDRED EIGHTY MILLION PESOS (P280,000,000.00) or an increase of ONE HUNDRED SEVENTY MILLION PESOS (P170,000,000.00) xxx
from various banks/financial institutions;

xxxx

GRANTING CLAUSE

NOW, THEREFORE, this INDENTURE witnesseth:

THAT the MORTGAGOR in consideration of the premises and of the acceptance by the TRUSTEE of the trust hereby created, and in order to secure the payment of the MORTGAGE
OBLIGATIONS which shall be incurred by the MORTGAGOR pursuant to the terms hereof xxx hereby states that with the execution of this INDENTURE it will assign, transfer and
convey as it has hereby ASSIGNED, TRANSFERRED and CONVEYED by way of a registered first mortgage unto RCBC x x x the various parcels of land covered by several Transfer
Certificates of Title issued by the Registry of Deeds, including the buildings and existing improvements thereon, as well as of the machinery and equipment more particularly described
and listed that is to say, the real and personal properties listed in Annexes "A" and "B" hereof of which the MORTGAGOR is the lawful and registered owner.45 (Emphasis and
underlining ours)

The Deed of Amendment to MTI dated 20 November 1992 expressly provides:

NOW, THEREFORE, premises considered, the parties considered have amended and by these presents do further amend the Mortgage Trust Indenture dated August 26, 1992
including the Real Estate Mortgage as follows:

xxxx

2. The Mortgage Trust Indenture and the Real Estate Mortgage are hereby amended to include as part of the Mortgage Properties, by way of a first mortgage and for pari-passu and
pro-rata benefit of the existing and new creditors, various machineries and equipment owned by the Paper City, located in and bolted to and forming part of the following, generally
describes as x x x more particularly described and listed in Annexes "A" and "B" which are attached and made integral parts of this Amendment. The machineries and equipment listed
in Annexes "A" and "B" form part of the improvements listed above and located on the parcels of land subject of the Mortgage Trust Indenture and the Real Estate
Mortgage.46 (Emphasis and underlining ours)

A Second Supplemental Indenture to the 26 August 1992 MTI executed on 7 June 1994 to increase the amount of loan from P280,000,000.00 to P408,900,000.00 also contains a
similar provision in this regard:

WHEREAS, the Paper City desires to increase its borrowings to be secured by the INDENTURE from PESOS: TWO HUNDRED EIGHTY MILLION (P280,000,000.00) to PESOS:
FOUR HUNDRED EIGHT MILLION NINE HUNDRED THOUSAND (P408,900,000.00) or an increase of PESOS: ONE HUNDRED TWENTY EIGHT MILLION NINE HUNDRED
THOUSAND (P128,900,000.00) x x x which represents additional loan/s granted to the Paper City to be secured against the existing properties composed of land, building, machineries
and equipment and inventories more particularly described in Annexes "A" and "B" of the INDENTURE x x x.47

(Emphasis and underlining ours)

Finally, a Third Supplemental Indenture to the 26 August 1992 MTI executed on 24 January 1995 contains a similar provision:

WHEREAS, in order to secure NEW/ADDITIONAL LOAN OBLIGATION under the Indenture, there shall be added to the collateral pool subject of the Indenture properties of the Paper
City composed of newly constructed two (2)-storey building, other land improvements and machinery and equipment all of which are located at the existing Plant Site in Valenzuela,
Metro Manila and more particularly described in Annex "A" hereof x x x.48 (Emphasis and underlining ours)

Repeatedly, the parties stipulated that the properties mortgaged by Paper City to RCBC are various parcels of land including the buildings and existing improvements thereon as well as
the machineries and equipments, which as stated in the granting clause of the original mortgage, are "more particularly described and listed that is to say, the real and personal
properties listed in Annexes A and B x x x of which the Paper City is the lawful and registered owner." Significantly, Annexes "A" and "B" are itemized listings of the buildings,
machineries and equipments typed single spaced in twenty-seven pages of the document made part of the records.

As held in Gateway Electronics Corp. v. Land Bank of the Philippines,49 the rule in this jurisdiction is that the contracting parties may establish any agreement, term, and condition they
may deem advisable, provided they are not contrary to law, morals or public policy. The right to enter into lawful contracts constitutes one of the liberties guaranteed by the Constitution.

It has been explained by the Supreme Court in Norton Resources and Development Corporation v. All Asia Bank Corporation50 in reiteration of the ruling in Benguet Corporation v.
Cabildo51 that:

x x x A court's purpose in examining a contract is to interpret the intent of the contracting parties, as objectively manifested by them. The process of interpreting a contract requires the
court to make a preliminary inquiry as to whether the contract before it is ambiguous. A contract provision is ambiguous if it is susceptible of two reasonable alternative interpretations.
Where the written terms of the contract are not ambiguous and can only be read one way, the court will interpret the contract as a matter of law. x x x

Then till now the pronouncement has been that if the language used is as clear as day and readily understandable by any ordinary reader, there is no need for construction.52

The case at bar is covered by the rule.

The plain language and literal interpretation of the MTIs must be applied. The petitioner, other creditor banks and Paper City intended from the very first execution of the indentures that
the machineries and equipments enumerated in Annexes "A" and "B" are included. Obviously, with the continued increase in the amount of the loan, totaling hundreds of millions of
pesos, Paper City had to offer all valuable properties acceptable to the creditor banks.

The plain and obvious inclusion in the mortgage of the machineries and equipments of Paper City escaped the attention of the CA which, instead, turned to another "plain language of
the MTI" that "described the same as personal properties." It was error for the CA to deduce from the "description" exclusion from the mortgage.

1. The MTIs did not describe the equipments and machineries as personal property. Had the CA looked into Annexes "A" and "B" which were referred to by the phrase "real and
personal properties," it could have easily noted that the captions describing the listed properties were "Buildings," "Machineries and Equipments," "Yard and Outside," and "Additional
Machinery and Equipment." No mention in any manner was made in the annexes about "personal property." Notably, while "personal" appeared in the granting clause of the original
MTI, the subsequent Deed of Amendment specifically stated that:

x x x The machineries and equipment listed in Annexes "A" and "B" form part of the improvements listed above and located on the parcels of land subject of the Mortgage Trust
Indenture and the Real Estate Mortgage.

The word "personal" was deleted in the corresponding granting clauses in the Deed of Amendment and in the First, Second and Third Supplemental Indentures.

2. Law and jurisprudence provide and guide that even if not expressly so stated, the mortgage extends to the improvements.

Article 2127 of the Civil Code provides:

Art. 2127. The mortgage extends to the natural accessions, to the improvements, growing fruits, and the rents or income not yet received when the obligation becomes due, and to the
amount of the indemnity granted or owing to the proprietor from the insurers of the property mortgaged, or in virtue of expropriation for public use, with the declarations, amplifications
and limitations established by law, whether the estate remains in the possession of the mortgagor, or it passes into the hands of a third person. (Underlining ours)

In the early case of Bischoff v. Pomar and Cia. General de Tabacos,53 the Court ruled that even if the machinery in question was not included in the mortgage expressly, Article 111 of
the old Mortgage Law provides that chattels permanently located in a building, either useful or ornamental, or for the service of some industry even though they were placed there after
the creation of the mortgage shall be considered as mortgaged with the estate, provided they belong to the owner of said estate. The provision of the old Civil Code was cited. Thus:

Article 1877 provides that a mortgage includes the natural accessions, improvements, growing fruits, and rents not collected when the obligation is due, and the amount of the
indemnities granted or due the owner by the underwriters of the property mortgaged or by virtue of the exercise of eminent domain by reason of public utility, with the declarations,
amplifications, and limitations established by law, in case the estate continues in the possession of the person who mortgaged it, as well as when it passes into the hands of a third
person.54

The case of Cu Unjieng e Hijos v. Mabalacat Sugar Co.55 relied on this provision. The issue was whether the machineries and accessories were included in the mortgage and the
subsequent sale during public auction. This was answered in the affirmative by the Court when it ruled that the machineries were integral parts of said sugar central hence included
following the principle of law that the accessory follows the principal.

Further, in the case of Manahan v. Hon. Cruz,56 this Court denied the prayer of Manahan to nullify the order of the trial court including the building in question in the writ of possession
following the public auction of the parcels of land mortgaged to the bank. It upheld the inclusion by relying on the principles laid upon in Bischoff v. Pomar and Cia. General de
Tabacos57 and Cu Unjieng e Hijos v. Mabalacat Sugar Co.58

In Spouses Paderes v. Court of Appeals,59 we reiterated once more the Cu Unjieng e Hijos ruling and approved the inclusion of machineries and accessories installed at the time the
mortgage, as well as all the buildings, machinery and accessories belonging to the mortgagor, installed after the constitution thereof.

3. Contrary to the finding of the CA, the Extra-Judicial Foreclosure of Mortgage includes the machineries and equipments of respondent. While captioned as a "Petition for Extra-Judicial
Foreclosure of Real Estate Mortgage Under Act No. 3135 As Amended," the averments state that the petition is based on "x x x the Mortgage Trust Indenture, the Deed of Amendment
to the Mortgage Trust Indenture, the Second Supplemental Indenture to the Mortgage Trust Indenture, and the Third Supplemental Indenture to the Mortgage Trust Indenture
(hereinafter collectively referred to as the Indenture) duly notarized and entered as x x x."60 Noting that herein respondent has an outstanding obligation in the total amount of Nine
Hundred One Million Eight Hundred One Thousand Four Hundred Eighty Four and 10/100 Pesos (P901,801,484.10), the petition for foreclosure prayed that a foreclosure proceedings
"x x x on the aforesaid real properties, including all improvements thereon covered by the real estate mortgage be undertaken and the appropriate auction sale be conducted x x x."61

Considering that the Indenture which is the instrument of the mortgage that was foreclosed exactly states through the Deed of Amendment that the machineries and equipments listed
in Annexes "A" and "B" form part of the improvements listed and located on the parcels of land subject of the mortgage, such machineries and equipments are surely part of the
foreclosure of the "real estate properties, including all improvements thereon" as prayed for in the petition.

Indeed, the lower courts ought to have noticed the fact that the chattel mortgages adverted to were dated 8 January 1990, 19 July 1990, 28 June 1991 and 28 November 1991. The real
estate mortgages which specifically included the machineries and equipments were subsequent to the chattel mortgages dated 26 August 1992, 20 November 1992, 7 June 1994 and
24 January 1995. Without doubt, the real estate mortgages superseded the earlier chattel mortgages.1wphi1

The real estate mortgage over the machineries and equipments is even in full accord with the classification of such properties by the Civil Code of the Philippines as immovable
property. Thus:

Article 415. The following are immovable property:

(1) Land, buildings, roads and constructions of all kinds adhered to the soil;

xxxx

(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land, and
which tend directly to meet the needs of the said industry or works;

WHEREFORE, the petition is GRANTED. Accordingly, the Decision and Resolution of the Court of Appeals dated 8 March 2005 and 8 August 2005 upholding the 15 August 2003 and
1 December 2003 Orders of the Valenzuela Regional Trial Court are hereby REVERSED and SET ASIDE and the original Order of the trial court dated 28 February 2003 denying the
motion of respondent to remove or dispose of machinery is hereby REINSTATED.

SO ORDERED.

53. G.R. No. 189248

February 5, 2014

TEODORO S. TEODORO (Deceased), Substituted by his heirs/sons NELSON TEODORO and ROLANDO TEODORO, Petitioners,
vs.
DANILO ESPINO, ROSARIO SANTIAGO, JULIANA CASTILLO, PAULINA LITAO, RAQUEL RODRIGUEZ, RUFINA DELA CRUZ, and LEONILA CRUZ, Respondents.

DECISION

PEREZ, J.:

We here have what appears to be a cut and dried case for ejectment which has, nonetheless, resulted in three conflicting and varying decisions of the lower courts. We exercise judicial
restraint: we simply delineate the possessory rights of the warring parties and refrain from ruling on these squabbling heirs' respective claims of ownership.

This petition for review on certiorari under Rule 45 of the Rules of Court assails the Decision1 of the Court of Appeals in CA-G.R. SP No. 99805 which reversed and set aside the
Decision2 of the Regional Trial Court (RTC) Branch 81, Malolos, Bulacan in Civil Case No. 634-M-06 which, in turn, vacated and set aside the Decision3 of the Municipal Trial Court
(MTC), Bulacan, Bulacan in Civil Case No. 1240. The case is for Forcible Entry filed by the predecessor-in-interest of petitioners Nelson and Rolando Teodoro, heirs of Teodoro S.
Teodoro (Teodoro Teodoro), against respondents Danilo Espino, Rosario Santiago, Juliana Castillo, Paulina Litao, Raquel Rodriguez, Rufina dela Cruz and Leonila Cruz, a squabble
for physical possession of a portion of a real property, the ownership of which is traceable to Genaro Teodoro (Genaro).

The subject property is a portion within Cadastral Lot No. 2476 with a total area of 248 square meters, covered by Tax Declaration No. 99-05003-0246, registered in the name of
Genaro, long deceased ascendant of all the parties. The subject property pertains to the vacant lot where the old ancestral house of Genaro stood until its demolition in June 2004, at
the instance of Teodoro Teodoro.

Genaro had five children: Santiago; Maria, from whom respondents descended and trace their claim of ownership and right of possession; Petra, Mariano, Teodoro Teodoros father;
and Ana. Genaro and his children are all deceased.

Respondents respective parents are first cousins of Teodoro Teodoro. All parties are collateral relatives of Petra Teodoro: Teodoro Teodoro is her nephew while respondents are her
grandnephews and grandnieces, descendants of Petras sister, Maria Teodoro.

Of all Genaros children, only Petra occupied the subject property, living at the ancestral house. Genaros other children, specifically Santiago, Maria and Mariano were bequeathed, and
stayed at, a different property within the same locality, still from the estate of their father.

After Petras death, her purported will, a holographic will, was probated in Special Proceedings No. 1615-M before RTC, Branch 8, Malolos, Bulacan, which Decision on the wills
extrinsic validity has become final and executory.4 In the will, Petra, asserting ownership, devised the subject property to Teodoro Teodoro.

Teodoro Teodoro effected the demolition of the ancestral house, intending to use the subject property for other purposes.

Soon thereafter, respondents, who resided at portions of Lot No. 2476 that surround the subject property on which the ancestral house previously stood, erected a fence on the
surrounding portion, barricaded its frontage, and put up a sign thereat, effectively dispossessing Teodoro Teodoro of the property bequeathed to him by Petra.

After Teodoro Teodoros demand for respondents to vacate the subject property went unheeded, he filed the complaint for forcible entry against respondents, alleging the following in
pertinent part:

3. [Teodoro Teodoro] is a nephew of the deceased Petra Teodoro vda. De Salonga x x x who executed a holographic will designating him therein as administrator of her estate and
likewise devised in his favor a parcel of land located in Purok 2, Bambang, Bulacan, Bulacan and the ancestral house built therein. Other properties of Petra Teodoro were bequeathed
in favor of other named heirs. x x x.

4. Aforementioned parcel of land with the ancestral house was in turn inherited by the decedent Petra Teodoro from her father Genaro Teodoro who also gave separate properties to his
four other children, who are all dead, namely, Santiago who has eight (8) children, Maria who has six (6) children, Ana who has no child and Mariano who has eight (8) children
including herein [Teodoro Teodoro] as the eldest;

5. It is of common knowledge in the locality that the subject property where the ancestral house stood was given by Genaro Teodoro to [his] daughter Petra Teodoro to the exclusion of
all others. Petra Teodoro lived in that property all her life. x x x.

xxxx

7. This subject property is declared for taxation purposes in the name of [Teodoro Teodoros] grandfather, Genaro Teodoro as shown by the hereto attached photocopy of Tax
Declaration of Real Property No. 99-05003-0246 for the year 2000 which is marked as Annex "F";

xxxx

10. [Subject property] having been given to [Teodoro Teodoro] as a devisee in the approved will of Petra Teodoro, it became his absolute property to the exclusion of all others;

11. Sometime in July 2004, [Teodoro Teodoro] as the absolute owner and possessor thereof, decided to demolish the already dilapidated ancestral house in the subject property to
clear the same for other available uses/purposes. x x x.

12. By means of force and intimidation, [Teodoro Teodoro] was ousted likewise prevented by [respondents] from entering the subject property. [Respondents] have also
onverted/appropriated for themselves the exclusive use of the subject property into their own parking lot and other personal use, to the exclusion and damage of [Teodoro
Teodoro];5 (Emphasis supplied).

In their Answer, respondents asserted their own ownership and possession of the subject property, countering that:

5. It is worth to mention that [respondents] Danilo Espino and Rosario Santiago are residing thereat for more than fifty (50) years, while [respondents] Paulina Litao and Rufina dela
Cruz are resident of the subject place for more than sixty (60) years, most of them residing thereat since birth, at the time that their grandmother Maria Teodoro is still living and residing
thereat.

6. Thus, when siblings Maria Teodoro (grandmother of [respondents]), Petra (to whom the subject property was inherited) and Mariano (father of [Teodoro Teodoro]) died, the heirs,
who include [respondents] and [Teodoro Teodoro] extrajudicially, among themselves, partitioned the property left by their ascendants, which are still in the name of the siblings father
Genaro Teodoro. [Respondents], since they are already residing in the subject property and had built their respective houses therein, had with them the said subject [property]. x x x.

7. [Respondents], through their authorized representative, [respondent] Rosario Santiago, in the exercise of their act of ownership of the subject lot paid for its real property taxes. x x x.

8. x x x [Teodoro Teodoro] deliberately failed to consider and mention in his complaint that there was already a decision rendered by court, declaring the subject property as part of the
property left by Petra Teodoro to her legitimate heirs, which include among others [respondents].

9. That however, due to [respondents] failure as substituted heirs to execute the order, dated May 18, 1994, a Motion for the Revival of Judgment was filed and heard before Branch 10
of the Regional Trial Court of Bulacan. The Honorable Court x x x resolved x x x the extent of the allowance and admission to probate the holographic will of the late Petra Teodoro,
where a Certificate of Allowance dated February 14, 1990 was subsequently issued, as its Decision dated June 29, 1989 became final and executory, affect the revival of judgment.

xxxx

13. While it is true that the dilapidated ancestral house in the subject property was demolished; however, the said act, as suggested by [Teodoro Teodoro] was allowed by [respondents]
(who had their respective houses built in the same lot where the same is constructed) in order to have the same be partitioned among themselves. As [Teodoro Teodoro] was constantly
complaining that the property left to him and his siblings is less than the subject property given to the [respondents] in area, they agreed verbally that if the ancestral house will be
demolished, a surveyor would be at ease in surveying the same and determine if indeed the area is more than that allotted to [Teodoro Teodoro], which in that case, as per agreement,

the excess, if any will suffice the lack in area of [Teodoro Teodoro]. It was however found out that the area of the subject property was less than the area that should be allocated and
apportioned as shares of [respondents], hence they [intimated] the same to [Teodoro Teodoro], who got mad and threaten[ed] to get the subject property from them.

14. The putting of signs "No Trespassing" posted at the frontage of the subject property is an allowable act by owners, residing thereat to protect their property against intruders, hence
there is nothing wrong for [respondents] to put the same. x x x.

15. There is no truth, as what [Teodoro Teodoro] claimed in paragraph 12 of his complaint that he was ousted and prevented from entering the subject property by [respondents],
because in the first place he could not be ousted thereat, as he is not in possession of the said property.6 (Emphasis theirs).

After trial, the MTC dismissed the complaint, ruling on the issue of ownership and ultimately resolving the issue of who between Teodoro Teodoro and respondents had a better right to
possess the subject property:

x x x [Teodoro Teodoros] claim of ownership over the subject lot stemmed from the approved and duly probated Holographic Will of Petra Teodoro. Although it its undisputed that Petra
Teodoro was in actual possession of the subject lot prior to her demise and that she left a Holographic Will wherein the subject lot was bequeathed to [Teodoro Teodoro], the probate of
her last will has not finally settled the question of ownership over the subject lot. Clearly, the subject lot still forms part of the estate of the late Genaro Teodoro. In the absence of an
actual and approved partition plan among his heirs, the subject lot remains part of the Genaro Teodoros estate. Since his children Santiago, Maria, Petra, Maraino and Ana are all
deceased, their children or grandchildren by right of representation have the right to inherit from their ancestor.

xxxx

A person who claims that he has a better right to real property must prove his ownership of the same x x x. Clearly, [Teodoro Teodoro] has failed to prove his ownership over the
property or that of his devisee Petra Teodoro. Thus, the court is convinced that the possession of [respondents] over the subject lot should not be disturbed, until and unless the
question of ownership over the same shall have been finally resolved before the appropriate court.

xxxx

WHEREFORE, judgment is hereby rendered dismissing the complaint and the counterclaim interposed in relation thereto, without pronouncement as to costs.7

The RTC, in its appellate jurisdiction over forcible entry cases, acting on Teodoro Teodoros appeal, adopted the factual findings of the MTC, but reversed the ruling, ruled in favor of
Teodoro Teodoro and ordered the ejectment of respondents from the subject property. It pithily ruled, thus:

But the bottom line for resolution in this case is who has the prior physical possession of the subject parcel. x x x.

The late Petra Teodoros share to the inheritance of his father Genaro is admittedly the old ancestral house and the lot over which it stands. x x x.

[Teodoro Teodoro] claims right to possession only over said portion (now the vacant space x x x not the entire lot 2476 until he was displaced therefrom by the [respondents] through
force). [Teodoro Teodoro] does not contest the perimeter area of Lot 2476 where [respondents] are residing. He has acknowledged in clear terms that the rest of the area of Lot 2476 is
occupied by [respondents]. The assailed decision recognized that Petra Teodoro was in actual possession of the lot prior to her death. It is [Teodoro Teodoros] argument that Petra
Teodoro, tacked [from by Teodoro Teodoro], has had prior physical possession of the controverted portion of lot 2476. He went on arguing that regardless of whether or not the duly
probated will completely settled the issue of partition of the remaining estate of Genaro Teodoro, he has the prior actual and physical possession of the vacant space where the old
ancestral house formerly stands, passed on to him by the late Petra Teodoro, a fact [respondents] deny. [Respondents] even belied that they have ousted and restrained [Teodoro
Teodoro] from entering the subject property.

Said pretension is however negated by evidence showing the barricaded vacant space or disputed area consisting of 120 square meters, more or less (approximate width of lot is 7.55
meters, approximate length is 17.9 meters with indented portion measuring 1.5 meters deep x x x), where the cemented portion of the flooring of the bakery near the national road lease
by [respondents] is still existing x x x and over which he exercised control and constructive possession. x x x.

xxxx

[Teodoro Teodoro] anchors on the other hand his claim on the Holographic Will of Petra Teodoro dated May 1, 1973 x x x duly probated and approved in a Decision x x x dated June
19, 1989 of Branch 8 of this Court in SP Proceeding No. 1615-M, which Decision has become final and executory as of February 14, 1990 x x x bequeathing the disputed portion of Lot
2476 and the old ancestral house thereon to him, the letters of administration issued to him by Branch 8 of this Court x x x, the Project of Partition submitted to the said court x x x plus
his possession of the vacant area or disputed portion of [L]ot 2476. [Respondents] has stressed that he is not contesting the rest of [L]ot 2476 occupied by the houses of [respondents].

Analyzing the facts of the case, the lower [court] concluded that the subject parcel is a part of the estate of the late Genaro Teodoro and in the absence of an approved partition among
the heirs, remains a community property over which the legal heirs of Genaro Teodoro have the right to inherit. All therefore are entitled to exercise the right of dominion including the
right of possession.

This Court disagrees with the said ruling applying the plethora of cases decisive of the issue and consistent with the established jurisprudence that the lower court cannot dispose with
finality the issue of ownership-such issue being inutile in an ejectment suit except to throw light on the question of possession.

Given the foregoing, [Teodoro Teodoro] has established a valid claim to institute the eviction suit against [respondents] over the disputed area or vacant portion of Lot 2476 and for him
to be restored therein.

xxxx

WHEREFORE, premises considered, finding reversible error on the appealed judgment, the same is hereby VACATED and SET ASIDE and a new one is entered as follows:

1. Ordering that [Teodoro Teodoro] be restored in the lawful possession of the disputed area of Lot 2476 and for the eviction therefore of [respondents] on said portion;
and

2. [Respondents] to pay the costs of the suit.8

With the reversal of the MTCs ruling, respondents then appealed the RTCs decision to the Court of Appeals. The appellate court reversed the RTC, likewise dismissed the complaint
as the MTC had done, but did not reach the same result as that of the inferior court. It specifically ruled that Teodoro Teodoro:

(1) never had physical possession of the subject property, not having lived there at anytime, whether while Petra was alive nor after her death;

(2) did not adduce evidence before the lower courts on proof of payment of any real property tax on the disputed vacant lot, portion of Lot No. 2476, or to the whole of Lot
No. 2476;

(3) did not solely or unilaterally cause the demolition of the ancestral house such a fact equating to his exclusive ownership of the subject property and complete control
and dominion over it; and

(4) cannot tack his alleged possession of the subject property to that of Petra Teodoro simply by virtue of the latters holographic will, leading to the issue of ownership
which is insignificant in forcible entry cases.

In all, the appellate court found that Teodoro Teodoro (substituted by his heirs Nelson and Rolando Teodoro at that juncture) "failed to discharge the burden of proof that he had prior
actual physical possession of the subject [property] before it was barricaded by [respondents] to warrant the institution of the forcible entry suit." The appellate court disposed of the
case, thus:

WHEREFORE, premises considered, the assailed Decision [dated] 28 February 2007 and Resolution dated 26 June 2007 of the Regional Trial Court of Malolos, Bulacan, Branch 81
are hereby REVERSED and SET ASIDE, and the instant case is DISMISSED for lack of merit.9

Hence, this appeal by certiorari filed by the heirs of Teodoro Teodoro raising the following errors in the appellate courts dismissal of the complaint:

1. The Honorable Court of Appeals failed to take notice of relevant facts such as petitioner Teodoros exercise of possessory rights over the subject property, among
others, which if properly considered, will justify a different conclusion.

2. The Honorable Court of Appeals misappreciated undisputed facts such as the respondents fencing of the vacant area cleared by petitioner Teodoro and their
barricading of the frontage thereof, among others, that deprived petitioner Teodoro his possessory rights over the vacant area.

3. The findings of the Honorable Court of Appeals are grounded entirely on speculation, surmises or conjectures.

4. There is grave abuse of discretion in the appreciation of facts in the assailed Decision.10

The assigned errors define the issue for our resolution which is whether or not the act of respondents in barricading the frontage of the portion of Lot No. 2476 on which stood the
ancestral house occupied by Petra amounted to Teodoro Teodoros unlawful dispossession thereof through the forcible entry of respondents.

The ground rules in forcible entry cases:11

(1) One employs force, intimidation, threat, strategy or stealth to deprive another of physical possession of real property.

(2) Plaintiff (Teodoro Teodoro) must allege and prove prior physical possession of the property in litigation until deprived thereof by the defendant (herein respondents).
This requirement implies that the possession of the disputed land by the latter was unlawful from the beginning.

(3) The sole question for resolution hinges on the physical or material possession (possession de facto) of the property. Neither a claim of juridical possession
(possession de jure) nor an averment of ownership by the defendant can, at the outset, preclude the court from taking cognizance of the case.

(4) Ejectment cases proceed independently of any claim of ownership, and the plaintiff needs merely to prove prior possession de facto and undue deprivation thereof. In
this case, both parties assert prior and exclusive physical possession in the concept of owner12 acquired through succession13 from the same decedent, their aunt and
grand aunt, respectively, Petra. In turn, Petra inherited the property from her father Genaro, in whose name the subject property is still registered.

Teodoro Teodoros assertion of physical possession comprises mainly of his claimed ownership of the subject property acquired through testate succession, or via the holographic will
of Petra.14 Teodoro Teodoro then points, as an exercise of his ownership and incident of his physical possession of the subject property, to his act of demolition of the ancestral house.

On the other hand, respondents assert possession likewise by virtue of ownership manifested in their residence at Lot No. 2476 spanning more than five (5) decades, reckoned even
from the time Maria, respondents grandmother and sister of Petra, was alive and resided thereat.15

Respondents trace their possession from the extrajudicial partition of the commingled properties of the siblings Maria, respondents direct ascendant, Petra and Mariano, father of
Teodoro Teodoro, progeny and heirs of Genaro.16 According to respondents, from the partition, the heirs of all three Genaro children possessed and occupied their respective shares:
respondents received Lot No. 2476 which encompasses herein subject property, while Teodoro Teodoro and his siblings received a different property, "a 667 residential lot at Bambang,
Bulacan, Bulacan."

Also, respondents aver that, through respondent Rosario Santiago, they paid for Lot No. 2476s realty taxes. Respondents counter that the subject property was not solely bequeathed
to Teodoro Teodoro as it is part of Petras estate for disposition to her legitimate heirs, including herein respondents. Lastly, on Teodoro Teodoros claim that he had solely effected the
demolition of the ancestral house, respondents contend that they had allowed the demolition upon the understanding that the parties would then completely partition the subject
property, as that portion is centrally located in Lot No. 2476 where the respondents actually reside.

Given both parties respective claims of ownership over the subject property via succession from their ascendants Maria, Petra and Mariano Teodoro, who are all compulsory heirs of
Genaro in whose name the subject property is still registered, the MTC ruled that respondents cannot be disturbed in their possession of the subject property "until and unless the
question of ownership over the same [is] finally resolved before the appropriate court."

In contrast, the RTC, without categorically resolving the issue of ownership of Lot No. 2476, ruled that on the portion of Lot No. 2476 where the ancestral house used to stand, Teodoro
did establish his prior physical possession over the subject property resulting in his right to institute the ejectment suit against respondents. Significantly, the RTC confirmed
respondents physical possession of, and residency at, Lot No. 2476.

There would yet be another turn of events. The appellate court, albeit refusing to touch and rule on the issue of ownership, declared that there lacked conclusive evidence of Teodoro
Teodoros prior actual physical possession over the subject property. Thus, the appellate court dismissed

Teodoro Teodoros complaint for lack of merit.

We are now asked for a final ruling.

We grant the petition. We reverse the decision of the Court of Appeals and restore the decision of the RTC on the appeal reversing the MTC.

We affirm the finding of fact by the RTC which is decisive of the issue that has remained unresolved inspite of a summary procedure and two appellate reviews of the forcible entry case
filed by Teodoro Teodoro. The RTC said:

Analyzing the facts of the case, the lower [court] concluded that the subject parcel is a part of the estate of the late Genaro Teodoro and in the absence of an approved partition among
the heirs, remains a community property over which the legal heirs of Genaro Teodoro have the right to inherit. All therefore are entitled to exercise the right of dominion including the
right of possession.17 (Emphasis supplied).

The RTCs comment that it "disagrees with the said ruling" only meant that "the lower court cannot dispose with finality the issue of ownership" since such ownership issue is "inutile in
an ejectment suit except to throw light on the question of possession."18 And so the RTC ruled that Teodoro Teodoro should be restored in the lawful possession of the disputed area of
Lot No. 2476 in light of the finding of the MTC that the subject lot still forms part of the estate of the late Genaro Teodoro. It is from this same fact that the MTC reached the contrary
conclusion that Teodoro Teodoros complaint should be dismissed because he has "failed to prove his ownership."19

In the sense that Teodoro Teodoro has not proven exclusive ownership, the MTC was right.1wphi1 But exclusive ownership of Lot No. 2476 or a portion thereof is not in this case
required of Teodoro Teodoro for him to be entitled to possession. Co-ownership, the finding of both the MTC at first instance and by the RTC on appeal, is sufficient. The pertinent
provisions of the Civil Code state:

Art. 484. There is co-ownership whenever the ownership of an undivided thing or right belongs to different persons.

Art. 1078. When there are two or more heirs, the whole estate of the decedent is, before its partition, owned in common by such heirs, subject to the payment of debts of the deceased.

Certainly, and as found by the trial courts, the whole of Lot No. 2476 including the portion now litigated is, owing to the fact that it has remained registered in the name of Genaro who is
the common ancestor of both parties herein, co-owned property. All, or both Teodoro Teodoro and respondents are entitled to exercise the right of possession as co-owners.

Neither party can exclude the other from possession. Although the property remains unpartitioned, the respondents in fact possess specific areas. Teodoro Teodoro can likewise point
to a specific area, which is that which was possessed by Petra. Teodoro Teodoro cannot be dispossessed of such area, not only by virtue of Petra's bequeathal in his favor but also
because of his own right of possession that comes from his co-ownership of the property. As the RTC concluded, petitioners, as heirs substituting Teodoro

Teodoro in this suit, should be restored in the lawful possession of the disputed area.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 99805 is REVERSED and SET ASIDE and the Decision of the Regional Trial Court
in Civil Case No. 634-M-06 is REINSTATED. No pronouncement as to costs.

SO ORDERED.

54. G.R. No. 174844

March 20, 2013

VEVENCIA ECHIN PABALAN, ET AL., Petitioner,

vs.
THE HEIRS OF SIMEON A.B. MAAMO, SR., Respondents.

DECISION

PEREZ, J.:

Filed pursuant to Rule 45 of the 1997 Rules of Civil Procedure, the petition for review at bench primarily assails the Decision1 dated 22 May 2006 rendered by the Twentieth Division of
the Court of Appeals (CA) in CA-G.R. CV No. 60769,2 reversing the Decision dated 20 August 1997 in turn rendered by the Regional Trial Court, Branch 26, Southern Leyte (RTC) in
Civil Case No. R-263.3

On 31 December 1910, Onofre Palapo sold in favor of Placido Sy-Cansoy a parcel of land situated in the then Barrio Calapian (now Barangay Estela), Liloan, Leyte (now Southern), for
the stated consideration of P86.00. Drawn in Spanish, the notarized Leyte Deed of Sale the former executed in favor of the latter identified the property as enclosed by the following
boundaries: on the North, by the Barrio Church; on the South and East, by the property of Matias Simagala; and, on the West, by the property of Miguel Maamo.4 On 29 October 1934,
Placido, in turn, executed a notarized deed in Spanish, affirming a 12 October 1912 sale of the same parcel for the sum of P100.00 in favor of Miguels wife, Antonia Bayon.5 Faulting
Simplecio Palapo with forcible entry into the property on 17 October 1934, Antonia, represented by Simeon Maamo, later filed the 4 December 1934 ejectment complaint which was
docketed as Civil Case No. 298 before the then Court of the Justice of the Peace of Liloan, Leyte.6

Served with summons, Simplecio filed an answer dated 6 December 1934, asserting that, as one of the heirs of Concepcion Palapo, he had been in legal possession of the property for
many years without once being disturbed by anyone.7 On the strength of the aforesaid documents of transfer as well as the evidence of prior possession adduced by Antonia, however,
the Court of the Justice of the Peace of Liloan, Leyte went on to render a Decision dated 17 December 1934, brushing aside Simplecios defense for lack of evidentiary basis and
ordering him to vacate the parcel in litigation.8 As may be gleaned from the 5 December 1983 certification later issued by Liloan, Leyte Municipal Trial Judge Patricio S. de los Reyes
Sr., it appears that the 24 December 1934 writ of execution issued in the case was later returned duly served.9

On 9 December 1981, Simeon Sr., Fabian Sr., Juliana, Olivo, Silvestre Sr., Angela, Bonifacia and Estelita, all surnamed Maamo (plaintiffs Maamo), commenced the instant suit with the
filing of their complaint for recovery of real property and damages against Simplecios children, Crispiniano, Juanito Sr., Arsenia and Roberto, all surnamed Palapo (defendants
Palapo).10 In their amended complaint, plaintiffs Maamo alleged that, as children and heirs of the Spouses Miguel and Antonia, they were the co-owners of the parcel of land sold by
Placido which, while reported in tax declarations to contain an area of 1,612 square meters, actually measured 13,813 square meters. Invoking the decision redeemed in favor of
Antonia in Civil Case No. 298, plaintiffs Maamo maintained that their parents later relented to Simplecios entreaty to be allowed to stay on the property as administrator. Plaintiffs
Maamo further averred that, having illegally claimed ownership over the western portion of the property after Simplecios death in 1971, defendants Palapo unjustifiably refused to heed
their demands for the return of the litigated section measuring 7,055 square meters.11

On 10 February 1982, defendants Palapo filed their answer, specifically denying the material allegations of plaintiffs Maamos complaint. Maintaining that they inherited the litigated
portion from Simplecio, defendants Palapo asserted that their father, in turn, inherited the same from his brother, Crispiniano Palapo, who also succeeded to the rights of Concepcion,
the tax declarant as early as 1906. By themselves and thru their said predecessors-in-interest, defendants Palapo insisted that they had been in open, continuous and adverse
possession of the litigated portion in the concept of owner since 1906, paying the realty taxes due thereon long before the Second World War. Even assuming that Antonia prevailed in
the ejectment suit she filed against Simplecio in 1934, defendants Palapo argued that the causes of action of plaintiffs Maamos were already barred by prescription, estoppel and
laches.12

At pre-trial, a commissioner was appointed to conduct an ocular inspection of the litigated portion and to submit a sketch showing, among other matters, the metes and bounds thereof.
On 15 August 1982, the court-appointed commissioner submitted a report and sketch, mapping out the 7,055 square meter portion in litigation and identifying its boundaries as follows:
on the North, by Maamo St.; on South by Peter Burset St.; on the East, by the Provincial Road; and, on the West, by Ang Bayon St.13 As noted in the 29 November 1983 pre-trial order
issued in the case, the identity of the portion in litigation was admitted by the parties.14 At the trial of the case on the merits, Simeon Sr. took the witness stand15 and submitted the
deeds executed by Onofre and Placido, the documents pertaining to Civil Case No. 298, the tax declarations (TDs) and receipts pertaining to the property dating back to the year 1918
and the certification to file action by the Barangay Estela Lupon secretary.16 By way of defense evidence, defendants Palapo presented the testimonies of Juanito Palapo and Balbina
Galgaw Madlos,17 together with the TDs and receipts which they traced to the TD filed by Concepcion in 1906.18

On 20 August 1997, the RTC rendered a decision, declaring defendants Palapo to be the legal owners and possessors of the litigated portion. Finding that Simplecios supposed 17
October 1934 forcible entry into the property preceded the 29 October 1934 deed Placido executed in favor of Antonia, the RTC brushed aside plaintiffs Maamos claim on the further
ground that the 7,055 square meter area of the litigated portion far exceeded the 1,612 square meters declared in their TDs which, as a rule, cannot prevail over defendants Palapos
actual possession of the property. Having possessed the litigated portion in the concept of owner for more than thirty years, defendants Palapo were also declared to have acquired the
property by means of prescription, without need of title or good faith. Ordered to respect defendants Palapos ownership and possession of the portion in litigation, the RTC held
plaintiffs Maamo liable to pay the former the total sum of P50,000.00 by way of actual and moral damages as well attorneys fees and litigation expenses.19

On appeal, the foregoing Decision was reversed and set aside in the herein assailed 22 May 2006 Decision rendered by the CAs Twentieth Division in CA-G.R. CV No. 60769. The CA
ruled that plaintiffs Maamo were the true and lawful owners of the litigated portion, upon the following findings and conclusions: (a) the 29 October 1934 deed Placido executed in favor
of Antonia was a mere affirmation of an earlier sale made on 12 October 1912, hence, the acquisition of the litigated portion by plaintiffs Maamos predecessor-in-interest predated
Simplecios 17 October 1934 entry thereon; (b) defendants Palapo traced their claim to Concepcions 1906 TD which pertained to a different parcel situated in Barrio Pandan, Liloan,
Leyte; (c) the claim that the litigated portion was inherited from Concepcion had been rejected in the 17 December 1934 Decision rendered in Civil Case No. 298 which appears to have
been returned duly served and executed; and, (e) since the possessory rights of plaintiffs Maamos predecessor-in-interest had been affirmed and restored, Simplecios continued
possession of the portion in litigation was by mere tolerance and could not, therefore, ripen into ownership acquired by prescription, laches or estoppel.20

In the meantime, the death of some of the original parties to the case resulted in their substitution by their respective heirs. Simeon, Sr. was substituted by his wife and children,
respondents Crispina, Simeon, Jr., Aselita, Remedios, Evansueda, Carmelita, Manuel, Elizabeth, Adelaida and

Miguel II, all surnamed Maamo. As a consequence, they were joined in the case with the surviving plaintiffs Maamo, (now respondents) Fabian Sr., Juliana, Olivo, Silvestre Sr., Angela,
Bonifacia and Estelita, all surnamed Maamo. On defendants Palapos side, Roberto was substituted by petitioners Lydia Veronica, Alily, Beverly and Maricar, all surnamed
Palapo.21 Juanito was, likewise, substituted by petitioners Generoso, Perla, Juanito Jr., Delia, Raul, Editha and Elvira, all surnamed Palapo. Arsenia was, in turn, substituted by her
children, petitioners V[e]vencia, Rogelio, Elizabeth, Josefina, Eusebio, Gavina and Amelita, all surnamed Enchin.

Crispiniano was, finally, substituted by his children, petitioners Angelita, Normita, Apolonia, Bining and Inday, all surnamed Palapo.22

On 7 September 2006, the CA issued the second assailed resolution of the same date, denying for lack of merit petitioners motion for reconsideration of its 22 May 2006 Decision.
Aggrieved, petitioners filed the petition at bench, on the following grounds:

1. THE CA SERIOUSLY ERRED IN REVERSING THE RTCS DECISION AND IN DECLARING THE RESPONDENTS IN CONTINUED POSSESSION OF THE
PROPERTY IN DISPUTE FROM 1918 TO 1980, NOTWITHSTANDING PETITIONERS EVIDENCE TO THE CONTRARY WHICH PREPONDERANTLY ESTABLISHED
THAT, BY THEMSELVES AND THRU THEIR PREDECESSORS-IN-INTEREST, THEY HAVE BEEN IN OPEN, PUBLIC, ADVERSE AND CONTINUOUS POSSESSION
THEREOF IN THE CONCEPT OF OWNERS SINCE 20 JULY 1906.

2. THE CA GRAVELY ERRED IN DISREGARDING SIMEON SR.S ADMISSION IN OPEN COURT THAT RESPONDENTS HAVE NOT BEEN IN POSSESSION OF THE
PROPERTY FROM 1935 UNTIL THE FILING OF THEIR COMPLAINT IN 1981, SAID ADMISSION BEING A CLEAR INDICATION THAT THEIR COMPLAINT IS
BARRED BY ESTOPPEL AND LACHES.

3. THE CA GRAVELY ERRED IN DECLARING RESPONDENTS AS OWNERS OF THE PROPERTY BY VIRTUE OF PRESCRIPTION UNDER THE CIVIL CODE.

4. THE CA SERIOUSLY ERRED IN RELYING ON THE JUDGMENT RENDERED IN CIVIL CASE NO. 298 AS BASIS FOR RESPONDENTS POSSESSION.

5. THE CA ALSO ERRED IN DECLARING THAT SIMPLECIOS POSSESSION WAS UPON THE TOLERANCE OF RESPONDENTS PREDECESSORS-ININTEREST.23

We find the petition bereft of merit.

For the most part, petitioners raise questions of fact which, as a general rule, are not proper subjects of appeal by certiorari under Rule 45 of the Rules of Court as this mode of appeal
is confined to questions of law.24 This Court is not a trier of facts and cannot, therefore, be tasked to go over the proofs presented by the parties in the lower courts and analyze, assess
and weigh them to ascertain if the court a quo and the appellate court were correct in their appreciation of the evidence.25 Among the recognized exceptions to this rule, however is
when the factual findings of the trial court are, as here, different from those of the CA.26 Even then, a re-evaluation of factual issues would only be warranted when the assailed findings

are totally bereft of support in the records or are so patently erroneous as to amount to grave abuse of discretion. So long as such findings are supported by the record, the findings of
the Court of Appeals are conclusive and binding on this Court, even if contrary to those of the trial court.27

Our perusal of the record shows that the CA correctly ruled that the land to which the litigated portion pertains was purchased from Placido by respondents predecessor-in-interest,
Antonia, on 12 October 1912 and not on 29 October 1934, the date of the document in which the former acknowledged the transaction in writing.28 Contrary to the RTCs finding,
therefore, Antonia already owned the property when petitioners own predecessor-in-interest, Simplecio, was alleged to have forcibly entered into the property on 17 October 1934.
Considering that Placido was, in turn, established to have purchased the property from Onofre on 31 December 1910,29 it was from the latter date that respondents rightfully traced
their ownership and possession thereof. Reference to the aforesaid transactions in the body of the 4 December 1934 ejectment complaint Antonia filed against Simplecio before the
Court of the Justice of the Peace of Liloan, Leyte30 also leave no doubt that the same property was the subject matter of Civil Case No. 298.

The area of the property that Antonia acquired in 1912 was, of course, not specified but was simply identified by the following boundaries: on the North, by the Barrio Church; on the
South and East, by the property of Matias Simagala; and, on the West, by the property of Miguel Maamo. By the time that the property was declared for taxation purposes in the name
of Antonias husband, Miguel, for the years 1918, 1948, 1971, 1974, 1976 and 1980, the boundaries enclosing the same were, however, already stated as follows: on the North, by
Maamo St.; on the South, by Peter Burset St.; on the East, by Union St.; and, on the West, by Ang Bayon St.31 These apparent variances in the boundaries of the property were,
however, elucidated during the direct examination of Simeon Sr. who explained the permutations said boundaries underwent over the years. These included the destruction of the
Barrio church in 1912 and its subsequent relocation, the construction of Maamo St., Peter Burset St. and Ang Bayon St. and the donation made by his parents, Miguel and Antonia, of
portions of the property for street construction.32

On the other hand, petitioners trace their claim of ownership and possession to Concepcion who declared a two-hectare parcel of land for taxation purposes in 1906 under TD 832 and
from whom her brother, Crispiniano, was alleged in the answer to have inherited the same. Contradicting their initial claim that Simplecio, in turn, inherited the property from
Crispiniano,33 petitioners later asserted that Simplecio directly inherited the property from Concepcion who was unmarried and died with issue.34 As a perusal thereof would readily
reveal, however, TD 832 was filed by Concepcion on 20 July 1906 with respect to a parcel of land situated in Barrio of Pandan and identified by the following boundaries: on the North,
by la Playa (the seashore); on the South, by Patrecio Lanog; on the East, by Simeon Bajan; and on the West, by Placido Cimagala.35 According to the testimony of Juanito, said
property was eventually subdivided into three parcels which were all eventually declared for taxation purposes in the name of Simplecio.36

Instead of Barrio Pandan which was stated as the location of Concepcions property in TD 832, our perusal of the TDs that petitioners adduced a quo shows that the three parcels into
which said property was supposedly divided are, however, situated in Barrio Estela. The first parcel was declared in the names of Concepcion and Justiniano Palapo under TDs 4173
and 5401 in the years 1922 and 1958, respectively, and was identified by the following boundaries: on the North, by Cuares St.; on the South, by Bahan St.; on the East, by Palapo St.;
and on the West by Union St.37 The foregoing boundaries were reproduced in TDs 16670 and 1997 in the name of Concepcion for the years 1971 and 1974, respectively.38 It was only
in 1975 and 1980, when the property was declared in the name of Simplecio under TDs 5125 and 4202, respectively, that the boundaries of the property were stated as follows: on the
North, by the Church Site; on the South, by Cuares St.; on the East, by the Provincial Road; and on the West, by the School Site.39

Declared for taxation purposes in the name of Concepcion under TDs 4175, 5411, 16667 and 1994 in the years 1922, 1948, 1971 and 1974, respectively, the second parcel was, on the
other hand, described as delimited by the following boundaries: on the North by Sarvida St.; on the South, by Cuares St.; on the East, by Union St.; and on the West, by the property of
Antonia Bayon.40 When the same parcel was, however, declared in Simplecios name in 1975 and 1980 under TDs 5123 and 4204, the boundaries were inexplicably altered in the
following wise: on the North, by Cuares and Sarvida St.; on the South, by the property of Demetrio Palapo; on the East, by the Seashore; and on the West, by the Provincial Road.41

The third parcel was, finally, declared in the names of Concepcion and Justiniano in the years 1922, 1948, 1971 and 1974 under TDs 4179, 5410, 16664 and 1993, respectively. Its
boundaries were identified as follows: on the North, by the property of Concepcion Palapo; on the South, by the property of Simeon Bajan; on the East, by Palapo St.; and on the West,
by Union St.42 By the time this parcel was declared for taxation purposes in Simplecios name in 1975 and 1980 under TDs 5121 and 4205, the boundaries were once again altered in
the following wise: on the North, by the Barrio Road and the property of Miguel Maamo; on the South, by the Church Site; on the East, by the Provincial Road; and on the West, by the
School Site and Barrio Road.43

As noted, the provenance of the foregoing TDs were all traced to TD 832 which pertained to a property situated in Barrio Pandan and not Barrio Estela, the location of the property in
litigation. Since both Simeon, Sr. and Juanito testified that Barrio Pandan is more than one kilometer to about two kilometers away from Barrio Estela,44 we find that the CA correctly
ruled that petitioners cannot trace their claim of possession and ownership to TD 832 that Concepcion obtained in 1906. In contrast, respondents were able to trace their claim to
Onofres 31 December 1910 sale of the property to Placido who, in turn, sold the same to Antonia on 12 October 1912. The TDs Miguel filed with respect to the property also date back
to 191845 or four years ahead of the TDs filed in 1922 in the names of Concepcion and Justiniano, over the three parcels into which the property was purportedly
subdivided.1wphi1 Even more importantly, the stated boundaries of the property declared in Miguels name are identical to the boundaries of the property identified in the sketch

submitted by the court-appointed commissioner. This cannot be said of the properties declared in the names of Concepcion and Justiniano, the boundaries of which were further altered
when they were declared in Simplecios name in 1975 and 1980.

As determined by the court-appointed commissioner, the total area of the parcel claimed by respondents measures 14,433 square meters, of which 7,055 square meters are, in turn,
claimed by petitioners.46 In deciding against respondents, the RTC ruled that the areas of said parcel and, for that matter, the portion in litigation, were disproportionately larger than the
1,612 square meters stated in the TDs adduced by respondents. It must be borne in mind, however, that what defines the land is not the numerical data indicated as its size or area but,
rather, the boundaries or "metes and bounds" specified in its description as enclosing the land and indicating its limits.47 To repeat, the evidence adduced a quo shows that the
boundaries of the parcel of land purchased by Antonia are consistent with the boundaries of the parcel of land in Miguels TDs and the sketch submitted by the court-appointed
commissioner.

Petitioners next fault the CA for supposedly disregarding their evidence to the effect that Simplecio had been in possession of the property since 1912 as well as Simeon Sr.s
admission that respondents have not been in possession thereof since 1935. Aside from the fact that the TDs they presented pertain to a different property, however, petitioners
conveniently overlook Antonias filing of an ejectment complaint against Simplecio in 1934 with respect to the property herein litigated. In the 17 December 1934 Decision rendered in
the case, the Court of the Justice of the Peace of Liloan Leyte significantly determined Antonias prior possession of the property and upheld her right to take possession
thereof.48 While it is true that a judgment rendered in a forcible entry case will not bar an action between the same parties respecting title or ownership,49 the rule is settled that such a
judgment is conclusive with respect to the issue of material possession.50 Although it does not have the same effect as res judicata in the form of bar by former judgment which
prohibits the prosecution of a second action upon the same claim, demand, or cause of action, the rule on conclusiveness of judgment bars the relitigation of particular facts or issues in
another litigation between the same parties and their privies on a different claim or cause of action.51

To Our mind, the fact that the writ of execution issued in Civil Case No. 298 was returned duly served52 also lends credence to respondents claim that Simplecios possession of the
property was upon Miguels tolerance.53 Since acts of a possessory character executed due to license or by mere tolerance of the owner are inadequate for purposes of acquisitive
prescription,54 petitioners cannot claim to have acquired ownership of the property by virtue of their possession thereof since 1935. Under Articles 44455 and 194256 of the old Civil
Code, possession of real property is not affected by acts of a possessory character which are merely tolerated by the possessor, or which are due to his license.57 Granted that long,
continued occupation, accompanied by acts of a possessory character, affords some evidence that possession has been exerted in the character of owner and under claim of
right,58 this inference is unavailing to petitioners since Simplecios continued possession of the property after his defeat in the ejectment suit was clearly upon the tolerance of
respondents predecessors-in-interest.

Viewed in the light of the foregoing considerations, petitioners reliance on Sections 4059 and 4160 of Act No. 190 or the Code of Civil Procedure is, at the very least, misplaced.
Inasmuch as possession must be adverse, public, peaceful and uninterrupted in order to consolidate prescription, it stands to reason that acts of a possessory character done by virtue
of a license or mere tolerance on the part of the real owner are not sufficient.61 It has been ruled that 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.62 Considering that Article 1119 of the present

Civil Code also provides that "(a)cts of possessory character executed in virtue of license or by mere tolerance of the owner shall not be available for the purposes of possession," the
error petitioners impute against the CA for applying the new Civil Code provisions on prescription is more apparent than real. Then as now, possession must be en concepto de dueo
or adverse in order to constitute the foundation of a prescriptive right. If not, such possessory acts, no matter how long, do not start the running of the period of prescription.63

As for the supposed fact that possession by tolerance was not among the issues simplified during the pre-trial of the case, suffice it to say that the same is subsumed in the second
issue identified in the RTCs 29 November 1983 pre-trial order, i.e., "(w)hether or not petitioners and their predecessors-in-interest had been in the actual, physical possession of the
land in question in the concept of owners since 1906 up to the present."64 Since Simplecio's possession of the subject parcel was by mere tolerance, we find that the CA correctly
brushed aside petitioners' reliance on estoppel which cannot be sustained by mere argument or doubtful inference.65 The same may be said of the CA' s rejection of laches, an
equitable doctrine the application of which is controlled by equitable considerations.66 It operates not really to penalize neglect or sleeping on one's rights, but rather to avoid
recognizing a right when to do so would result in a clearly inequitable situation.67 Unfortunately for petitioners' cause, no such situation obtains in the case.

WHEREFORE, premises considered, the instant petition for review on certiorari is DENIED for lack of merit.

SO ORDERED.