SPS. SONYA & ISMAEL MATHAY, JR., petitioners, vs. HON. COURT OF APPEALS, SPS.

TEODULFO & SYLVIA ATANGAN, SPS. AGUSTINA & AMOR POBLETE, SPS. EDUARDO &
FELICISIMA TIRONA, respondents.
G.R. No. 115788. September 17, 1998
FACTS:
A. Civil Case No. TM-175 (Spouses Atangan vs. Spouses Mathay and Register Deeds of Cavite)
- Involves two parcels of land (Lot No 2186-A and Lot No. 2186-C) covered by Transfer
Certificates of Title (TCT No. T-195350 and TCT No. 195351) issued in the name of Spouses
Atangan
- Sps. Atangan alleges that they are owners of two (2) parcels of land purchased from
Spouses Tomas Lucido and Eustaquia Villanueva as evidenced by the deed of sale and by
the Transfer Certificates issued. They immediately took possession of the same and paid
the corresponding realty taxes.
- Atagan alleges that the vendees titles were transferred to them by virtue of a decision on
the Civil case (Lucido vs Batallones and Petronilla Quimio, Director of Lands, and Registers
of Deeds of Cavite). Batallones and Quimio, on the other hand are the vendees of the lands
from the Bureau of Lands.
- Sale of the parcel of lands in favor of the heirs of Batallones and Quimio was evidenced by
Deed of Conveyance duly issued by the Bureau of Lands
- Sps. Atagan further alleges that Mathays (defendant) have enclosed a portion of said
property with a fence without their consent.
- The defendants (Spouses Mathay) declare that they were also issued with a title covering
the said land. Spouses Atagan asserts that the said title issued to Mathays was a product of
forgery because it was based on an alleged transferred certificate in favor of Pedro Banayo
and Pablo Pugay who have no right whatsoever on the real estate in question. Upon
investigation, it was certified by the Bureau of Lands that the said titles were falsified and
forged.
- Atagan therefore prays that since the title of the Mathays have no basis in law and that the
same was illegally procured on the basis of forgery, the same should be cancelled and the
Mathays have no right to take possession of the property in question. They also demand
moral, irreparable damages and attorneys fee for the same.
B. Civil Case No. TM-180 (Spouses Poblete vs. Spouses Mathay and the Register of Deeds of
Cavite)
- Involves a parcel of land registered in the name of Juana Batallones and Gaudencio Quimio
which was allegedly sold to Spouses Poblete as per Deed of Conditional Sale.
- Spouses Poblete alleges that they are registered owners of a parcel of land having
purchased the same from Juan Battallones and Gaudencio for themselves and on behalf of
their co-heirs as evidenced by Deed of Sale. The spouses took possession of the land and
alleges that the defendants (Spouses Mathay) have enclosed a portion of the said property
with a fence without the consent and against the will of the plaintiffs.
- The vendees whose titles were transferred in favor of the plaintiffs have obtained the title
by virtue of the decision by the court on the civil case (Tomas Lucido vs. Juana Onate
Batallones and Petronilla Q. Quimio, Director of Lands, the Register of Deeds of Cavite). The
heirs of Onofre Batallones and Modesta Quimio are the vendees of the land from the
Bureau of Lands as evidenced by a Certification issued by the Record Officer of the District
Land Office.
- The sale of the subject parcel of land from the Bureau of Lands in favor of the heirs of
Batallones and Quimio was also evidenced by a Deed of Conveyance duly issued by the
Bureau of Lands.
- The defendants (Spouses Mathay) declare that they were also issued with a title covering
the said land. Spouses Poblete asserts that the said title issued to Mathays was a product of
forgery because it was based on an alleged transferred certificate in favor of Pedro Banayo
and Pablo Pugay who have no right whatsoever on the real estate in question. Upon
investigation, it was certified by the Bureau of Lands that the said titles were falsified and
forged.

Spouses Poblete therefore prays that since the title of the Mathays have no basis in law and
that the same was illegally procured on the basis of forgery, the same should be cancelled
and the Mathays have no right to take possession of the property in question. They also
demand moral, irreparable damages and attorneys fee for the same.

B. Civil Case No. TM-206 (Spouses Tirona vs. Spouses Mathay, et. al)
- Spouses Motas bought a parcel of land (Lot 2186-B) covered by a Transfer of Certificate of
Title of the Registry of Deeds of Cavite from David Quimio as evidenced by a Deed of
Absolute Sale. They were issued by a Transfer Certificate (TCT No. T-203730).
- Vendors David Quimio, Sr., et. al, are the previous registered owners of the said land as
evidenced by a Transfer Certificate of Title (TCT No. T-192530). They obtained rights and
interest thereon from their predecessors who were vendees from the Bureau of Lands which
was then confirmed in a decision on a Civil case (Tomas Lucido vs. Juana Batallones and
Petonila Quimio)
- The subject land was subdivided into eight lots as evidenced by a Subdivision Plans. The
subdivided lots were bought by the Spouses from Motas in good faith, and were therefore
issued with Transfer Certificates of Title.
- Spouses Tirona are the one paying the corresponding real property taxes thereon and were
issued with corresponding tax declaration. They allege that the defendants (Spouses
Mathay) have enclosed among others the property in question with a fence and took
physical possession thereof without their knowledge and consent
- The defendants (Spouses Mathay) declare that they were also issued with a title covering
the said land. Spouses Tirona asserts that the said title issued to Mathays was a product of
forgery and falsification because it was based on an alleged transferred certificate in favor
of Pedro Banayo and Pablo Pugay who have no right whatsoever on the real estate in
question. Upon investigation, it was certified by the Bureau of Lands that the said titles
were falsified and forged.
- Spouses Tirona therefore prays that since the title of the Mathays have no basis in law and
that the same was illegally procured on the basis of forgery, the same should be cancelled
and the Mathays have no right to take possession of the property in question. They also
demand moral, irreparable damages and attorneys fee for the same.
The lower court decided for the defendant spouses Mathay and against the plaintiffs in the three
consolidated cases. On appeal, the Court of Appeals decided in favor of the plaintiff-appellants. Thus,
the appeal.
ISSUES:
1. WON Spouses Mathay can be considered buyers in good faith
2. WON Spouses-private respondents own the individual properties in question
HELD:
1. Spouses Mathay cannot be considered as purchasers in good faith because prior to the fencing
of the subject land, neither they nor their predecesssors-in-interest (Banayo and Pugay) ever
possessed the same. At the same time the property was sold to petitioners (Mathays), the
private respondents were not only in actual possession of the same but also built their houses
thereon, cultivated it and were in full enjoyment of the produce and fruits gathered therefrom.
Although it is a well settled principle that the person dealing on a registered land need not go
beyond the certificate of title, there are still circumstances which would put party on guard and
prompt him to investigate or inspect the property being sold to him. It is expected from the
purchaser of a valued price of a land to inquire first into the status or nature of possession of
the occupants, in concept of owner. 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 addition, before the fence around subject
property was erected, private respondent communicated their objection to the fencing of the
area by petitioners but they were ignored by the Mathays, who continued enclosing the
premises under controversy in the present of armed men employed by them.

2. The Spouses-Private respondents are the valid owners of the individual properties in question
because all the subsequent certificates of title including the petitioners titles are void for the
same were forged and falsified. It was further proved that the titles issued to Mathays are void
for the allegedly Sales Certifcate executed by Tomas Lucido in favor of Pedro Pugay was not
signed by the said Tomas Lucido. Neither does it bear the signature of the latter. It further
proved that the deeds showed by Banayo and Pugay were not for the individual property in
question. The circumstances surrounding the execution of the Deed of Absolute Sale by Pedro
Banayo and Pablo Pugay in favor of the spouses Sonya Mathay and Ismael Mathay further
showed that it did not comply with the legal formalities and was not duly notarized.
Furthermore, the residence certificates of vendors Banayo and Pugay appeared to be of
dubious source.
The Spouses Mathay utterly failed to discharge the burden of proving the sustainability of their
posture of them being buyers in good faith. Furthermore, the title of Pedro Banayo and Pablo Pugay
relied upon by them has been shown by preponderance of evidence to be the product of forgery.
Petition is DISMISSED for the lack of merit, and the Decision of the Court of Appeals is AFFIRMED in
toto.

HEIRS OF MANUEL A. ROXAS and TRINIDAD DE LEON VDA. DE ROXAS (in substitution of
original petitioner),petitioners, vs. COURT OF APPEALS and MAGUESUN MANAGEMENT &
DEVELOPMENT CORPORATION,respondents.
G.R. No. 118436. March 21, 1997
FACTS: This is a petition for review of the CA decision dated December 8, 1994alleging reversible
error committed by respondent appellate court when it affirmed the decision of the RTC of Cavite.
On July 1990, herein private respondent Maguesun Management and Development Corporation
(Maguesun Corporation) filed an Application for Registration of two parcels of unregistered land
located in Tagaytay City. In support of its application for registration, Maguesun Corporation presented
a Deed of Absolute Sale dated June 10, 1990, executed by Zenaida Melliza as vendor and indicating
the purchase price to be P170,000.00. Zenaida Melliza in turn, bought the property from the original
petitioner herein (because she was substituted by her heirs in the proceedings upon her death),
Trinidad de Leon vda. de Roxas for P200,000.00 two and a half months earlier, as evidenced by a
Deed of Sale and an Affidavit of Self-Adjudication.
Notices of the initial hearing were sent by the Land Registration Authority (LRA) on the basis of
Maguesun Corporations application for registration enumerating adjoining owners, occupants or
adverse claimants; Since Trinidad de Leon vda. de Roxas was not named therein, she was not sent a
notice of the proceedings. After an Order of general default was issued, the trial court proceeded to
hear the land registration case. Eventually, on February 1991 the RTC granted Maguesun
Corporations application for registration.
It was only when the caretaker of the property was being asked to vacate the land that petitioner
Trinidad de Leon Vda. de Roxas learned of its sale and the registration of the lots in Maguesun
Corporations name.
Hence, on April 1991, petitioner filed a petition for review before the RTC to set aside the decree of
registration on the ground that Maguesun Corporation committed actual fraud. She alleged that the
lots were among the properties she inherited from her husband, former President Manuel A. Roxas
and that her family had been in open, continuous, adverse and uninterrupted possession of the
subject property in the concept of owner for more than thirty years before they applied for its
registration under the Torrens System of land titling (in which no decision has been rendered

thereon). Petitioner further denied that she sold the lots to Zenaida Melliza whom she had never met
before and that her signature was forged in both the Deed of Sale and the Affidavit of SelfAdjudication. She also claimed that Maguesun Corporation intentionally omitted her name as an
adverse claimant, occupant or adjoining owner in the application for registration submitted to the LRA
such that the latter could not send her a Notice of Initial Hearing.
A document examiner from the PNP concluded that there was no forgery. Upon petitioners motion,
the signatures were re-examined by another expert from NBI. The latter testified that the signatures
on the questioned and sample documents were, however, not written by the same person.
Despite the foregoing testimonies and pronouncements, the trial court dismissedthe petition for
review of decree of registration. Placing greater weight on the findings and testimony of the PNP
document examiner, it concluded that the questioned documents were not forged and if they were, it
was Zenaida Melliza, and not Maguesun Corporation, who was responsible. Accordingly, Maguesun
Corporation did not commit actual fraud.
In a decision dated December 8, 1994, respondent court denied the petition for review and
affirmed the findings of the trial court. The CA held that petitioner failed to and
demonstrate that there was actual or extrinsic fraud, not merely constructive or intrinsic
fraud, a prerequisite for purposes of annuling a judgment or reviewing a decree of
registration.
Hence, the instant petition for review where it is alleged that the CA erred in ruling that Maguesun
Corporation did not commit actual fraud warranting the setting aside of the registration decree and in
resolving the appeal on the basis of Maguesun Corporations good faith. Petitioners pray that the
registration of the subject lots in the name of Maguesun Corporation be cancelled, that said property
be adjudicated in favor of petitioners and that respondent corporation pay for damages.
ISSUE: WON private respondent Maguesun Corporation committed actual fraud (signature forgery) in
obtaining a decree of registration over the two parcels of land, actual fraud being the only ground
to reopen or review a decree of registration.
HELD: WHEREFORE, the instant petition is hereby GRANTED. The Decision of the CA is hereby
REVERSED AND SET AS
1. The Court here finds that respondent Maguesun Corporation committed actual fraud in obtaining
the decree of registration sought to be reviewed by petitioner. A close scrutiny of the evidence on
record leads the Court to the irresistible conclusion that forgery was indeed attendant in the case at
bar. Although there is no proof of respondent Maguesun Corporations direct participation in the
execution and preparation of the forged instruments, there are sufficient indicia which proves that
Maguesun Corporation is not the innocent purchaser for value who merits the protection of the law.
Even to a laymans eye, the documents, as well as the enlarged photographic exhibit of the
signatures, reveal forgery. Additionally, Zenaida Mellizas non-appearance raises doubt as to her
existence
Petitioner and her family also own several other pieces of property, some of which are leased out as
restaurants. This is an indication that petitioner is not unaware of the value of her properties. Hence,
it is unlikely that indication that she would sell over 13,000 sqm of prime property in Tagaytay City to
a stranger for a measly P200,000.00. Would an ordinary person sell more than 13,000 sqm of prime
property for P170,000.00 when it was earlier purchased for P200,000.00?

3. Petitioner Vda. de Roxas contended that Maguesun Corporation intentionally omitted their name, or
that of the Roxas family, as having a claim to or as an occupant of the subject property.
The names in full and addresses, as far as known to the undersigned, of the owners of all adjoining
properties; of the persons mentioned in paragraphs 3 and 5 (mortgagors, encumbrancers, and
occupants) and of the person shown on the plan (original application submitted in LRC No) as
claimants are as follows:
Hilario Luna, Jose Gil, Leon Luna, Provincial Road
all at Tagaytay City (no house No.)

30

The highlighted words are typed in with a different typewriter, with the first five letters of the word
provincial typed over correction fluid. Maguesun Corporation, however, annexed a differentlyworded application for the petition to review case. In the copy submitted to the trial court, the
answer to the same number is as follows:
Hilario Luna, Jose Gil, Leon Luna, Roxas.
The discrepancy which is unexplained appears intentional. If the word Roxas were indeed erased
and replaced with Provincial Road all at Tagaytay City (no house No.) in the original
application submitted in LRC No. TG-373 BUT the copy with the word Roxas was submitted to
the trial court, it is reasonable to assume that the reason is to mislead the court into thinking that
Roxas was placed in the original application as an adjoining owner, encumbrancer, occupant or
claimant, the same application which formed the basis for the LRA Authority in sending out notices of
initial hearing. (Section 15 of PD No. 1529 actually requires the applicant for registration to state the
full names and addresses of all occupants of the land and those of adjoining owners, if known and if
not known, the extent of the search made to find them. Respondent corporation likewise failed to
comply with this requirement of law.)
Respondent corporations intentional concealment and representation of petitioners interest in the
subject lots as possessor, occupant and claimantconstitutes actual fraud justifying the
reopening and review of the decree of registration. Through such misfeasance, the Roxas
family was kept ignorant of the registration proceedings involving their property, thus effectively
depriving them of their day in court
The truth is that the Roxas family had been in possession of the property uninterruptedly through
their caretaker, Jose Ramirez. Respondent Maguesun Corporation also declared in number 5 of the
same application that the subject land was unoccupied when in truth and in fact, the Roxas family
caretaker resided in the subject property.
To conclude, it is quite clear that respondent corporation cannot tack its possession to that of
petitioner as predecessor-in-interest. Zenaida Melliza conveyed not title over the subject parcels of
land to Maguesun Corporation as she was not the owner thereof. Maguesun Corporation is thus
not entitled to the registration decree which the trial court granted in its decision.
Petitioner has not been interrupted in her more than thirty years of open, uninterrupted, exclusive
and notorious possession in the concept of an owner over the subject lots by the irregular transaction
to Zenaida Melliza. She therefore retains title proper and sufficient for original registration over
the two parcels of land in question pursuant to Section 14 of PD No. 1529.

NOTES:
1. 1. Registration of untitled land under the Torrens System is done pursuant to PD No. 1529, the
Property Registration Decree which amended and codified laws relative to registration of
property. 15 Adjudication of land in a registration (or cadastral) case does not become final and
incontrovertible until the expiration of one year after the entry of the final decree. Before such
time, the decision remains under the control and sound discretion of the court rendering the
decree, which court after hearing, may set aside the decision or decree and adjudicate the
land to another party. 16 Absence, minority or other disability of any person affected, or any
proceeding in court for reversing judgments, are not considered grounds to reopen or revise
said decree. s. 17 It is further required that a petition for reopening and review of the decree of
registration be filed within one year from the date of entry of said decree, that the petitioner
has a real and dominical right and the property has not yet been transferred to an innocent
purchaser.
2.

2.

Fraud is of two kinds: actual or constructive. Actual or positive fraud proceeds from an
intentional deception practiced by means of the misrepresentation or concealment of a
material fact. 19 Constructive fraud is construed as a fraud because of its detrimental effect
upon public interestsand public or private confidence, even though the act is not done or
committed with an actual design to commit positive fraud or injury upon other persons.

Fraud may also be either extrinsic or intrinsic. Fraud is regarded as intrinsic where the fraudulent acts
pertain to an issue involved in the original action, or where the acts constituting the fraud were or
could have been litigated therein, and is regarded as extrinsic where it prevents a party from having a
trial or from presenting his entire case to the court, or where it operates upon matters pertaining not
to the judgment itself but to the manner in which it is procured, so that there is not a fair submission
of the controversy. 21 Extrinsic fraud is also actual fraud, but collateral to the transaction sued upon. 22
The distinctions are significant because only actual fraud or extrinsic fraud has been accepted as
grounds for a judgment to be annulled or, as in this case, a decree of registration reopened and
reviewed.
1. Disclosure of petitioners adverse interest, occupation and possession should be made at the
appropriate time, i.e., at the time of the application for registration, otherwise, the persons
concerned will not be sent notices of the initial hearing and will, therefore, miss the
opportunity to present their opposition or claims.
1. Also, Publication of the Notice of Initial Hearing was made in the Official Gazette and in the
Record Newsweekly, admittedly not a newspaper of general circulation. While publication of
the notice in the Official Gazette is sufficient to confer jurisdiction upon the court, publication
in a newspaper of general circulation remains an indispensable procedural requirement.
Couched in mandatory terms, it is a component of procedural due process and aimed at giving
as wide publicity as possible so that all persons having an adverse interest in the land
subject of the registration proceedings may be notified thereof. Although jurisdiction of the
court is not affected, the fact that publication was not made in a newspaper of general
circulation is material and relevant in assessing the applicants right or title to the land.