PHILIPPINE ECONOMIC ZONE AUTHORITY discovery and the latter prescribing 10 years from the

(PEZA) V. FERNANDEZ alleged fraudulent registration.

FACTS: 2) NO. Reconveyance is a remedy for those whose

Lot 4673 was registered in the names of Florentina
Rapaya, Victorino Cuizon among others covered by
an OCT. Sometime thereafter, Jorgea Igot-Soro ño et
al executed an Extra-judicial Partition claiming to be
the only surviving heirs of the registered owners,
through which they were issued a TCT.
Said lot was among the object of an expropriation
proceeding before the RTC. Said RTC approved the
compromise Agreement b/w the Export Processing
Zone Authority (EPZA) and Igot-Soroño et al
wherein EPZA would pay a certain amount in
exchange for the subject property.
property has been wrongfully or erroneously
registered in another’s name. However, this cannot
be availed once the property has passed to an
innocent purchaser for value. Since the property has
already passed to the gov’t in an expropriation
proceeding, EPZA is entitled to enjoy the security
afforded innocent 3rd persons and their title to the
property must be preserved.
However, the private respondents are not w/o
remedy. They can sue for damages their co-heirs.

EPZA acquired title to said land by virtue of the RTC

decision and was issued a corresponding TCT.
The Heirs of the Florentina Rapaya and Juan Cuizon
filed a complaint to nullify several documents
including the TCT issued to EPZA for they were
excluded from the extrajudicial settlement of the
estate.

EPZA filed a motion to dismiss on the ground of

prescription and was denied thus elevated the case to
the CA wherein the CA ruled that the heirs of Igot-
Soroño defrauded the other heirs by falsely
representing that they were the only heirs enabling
them to appropriate the land in favor of EPZA. This
method of acquiring property created a constructive
trust in favor of the defrauded party and grants them
the right to vindicate regardless of the lapse of time.
Thus, the case at bar.

ISSUE/S:
1) Whether or not private respondent’s claim over the
expropriated land has prescribed
2) Whether or not reconveyance lies against
expropriated property

HELD:
1) YES. As provided in the Rules of Court, persons
unduly deprived of their lawful participation in a
settlement may assert their claim only w/in the 2-
year period after the settlement and distribution of
the estate. However, this prescriptive period will not
apply to those who had not been notified of the
settlement.

The Private respondents are deemed to have been

notified of the extrajudicial settlement since it was
registered and annotated on the certificate of title
over the lot.
The only exception to this rule is when the title still
remains in the hands of the heirs who have
fraudulently caused the partition of the said
property. In the case at bar, the title has already
passed to an innocent purchaser for value, the gov’t
through EPZA.

Their remedies of action for reconveyance resulting

from fraud, and action for reconveyance based on an
implied constructive trust has already prescribed as
well the former having prescribed 4 years from the