fullcase_property3

8/11/2019 FULLCASE_PROPERTY3

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G.R. No. L-48050 October 10, 1994

FELICIDAD JAVIER, petitioner,

vs.

HON. REGINO T. VERIDIANO II, Presiding Judge, Branch I, Court of First Instance of Zambales and REINO

ROSETE, respondents.

Cesar E. Palma for petitioner.

Saturnino V. Bactad for private respondent.

BELLOSILLO, J.:

Petitioner Felicidad Javier questions before us the order of a regional trial court citing the final decision

of the city court previously dismissing her complaint for forcible entry, and on the basis thereof,

dismissed her petition to quiet title on the ground of res judicata. We summon the time-honored

remedies accion interdictal, accion publiciana and accion reivindicatoria or accion de reivindicacion to

resolve the issues presented in the petition.

It appears that on 25 January 1963, petitioner filed a Miscellaneous Sales Application for Lot No. 1641,

Ts-308 of the Olongapo Townsite Subdivision, Lower Kalaklan, Olongapo City, with the District Land

Officer, Bureau of Lands, Olongapo City. Sometime in December 1970, alleging that she was forcibly

dispossessed of a portion of the land by a certain Ben Babol, she instituted a complaint for forcible entry

before the City Court of Olongapo City, docketed as Civil Case No. 926, stating in pars. 2 and 3 therein

that —

. . . plaintiff is the true, lawful and in actual, prior physical possession of a certain parcel of land situated

at Lower Kalaklan, City of Olongapo, said lot being designated as Lot No. 1641, Ts-308 of the Olongapo

Townsite Subdivision since 1961 and up to the present time, until the day and incidents hereinafter

narrated. . . . Sometime on December 12, 1970, the defendant, without express consent of plaintiff and

without lawful authority, through scheme, strategy and stealth, forcibly entered a portion on the

southwestern part of Lot No. 1641, Ts-308, with the assistance of hired helpers, started construction of

riprap along the Kalaklan River perimeter of said portion of land; said entry was further augmented by

removing plaintiff's chain link, fence with galvanized iron posts embedded in concrete, likewise

destroying plants introduced by plaintiff by removing existing BL (Bureau of Lands) monuments thereon,

and by these actions, defendant started exercising illegal possession of said portion of land which

contains an area of 200 square meters, more or less. 1

On 7 November 1972 the City Court of Olongapo City, Br. 4, 2 dismissed Civil Case No. 926 on the ground

that "it appears to the Court that the Bureau of Lands has considered the area in question to be outside

Lot 1641 of the plaintiff. . . ."3 The Decision of the City Court of Olongapo City became final and

executory on 30 April 1973 when the then Court of First Instance of Zambales and Olongapo City, Br.

3, 4 dismissed the appeal and affirmed the findings and conclusions of the City Court holding that

appellant (herein petitioner) failed to give sufficient evidence to prove that the area in question was

within the boundaries of Lot No. 1641. 5



Subsequently, on 17 December 1973, petitioner was granted Miscellaneous Sales Patent No. 5548 and

issued Original Certificate of Title No. P-3259 covering Lot No. 1641. Meanwhile, Ben Babol who was the

defendant and appellee in the complaint for forcible entry had sold the property he was occupying,

including the portion of about 200 square meters in question, to a certain Reino Rosete. Thus petitioner

demanded the surrender of the same area in dispute from Reino Rosete who repeatedly refused to

comply with the demand.

On 29 June 1977, or after about four (4) years from the finality of the dismissal of Civil Case No. 926,

petitioner instituted a complaint for quieting of title and recovery of possession with damages against

Ben Babol and Reino Rosete before the then Court of First Instance of Zambales and Olongapo City,

docketed as Civil Case No. 2203-0, alleging in pars. 2 and 3 therein that —

. . . plaintiff is the absolute owner in fee simple of a parcel of land identified as Lot No. 1641, Ts-308,

Olongapo Townsite Subdivision . . . covered by Original Certificate of Title No. P-3259, issued by the

Register of Deeds for the province of Zambales. . . . Sometime in December,

1970, and until present, defendants, relying on an application filed on December 23, 1969, with the

Bureau of Lands, however have squatted, illegally occupied and unlawfully possessed the southwestern

portion of plaintiff's above-described property of about 200 square meters, then by defendant BEN

BABOL and now by defendant REINO ROSETE, the former having sold the entirety of his property to the

latter, including the portion in question. . . . 6

Instead of filing a responsive pleading, therein defendant Reino Rosete (private respondent herein)

moved to dismiss the complaint on the ground of res judicata. Defendant Ben Babol did not file any

pleading.

In its Order dated 27 January 1978, 7 the then Court of First Instance of Zambales, Br. 1, 8 sustained the

argument of Rosete and granted his motion to dismiss. Thereafter, petitioner's motion forreconsideration was denied. 9 Hence, this petition for review on certiorari.

Petitioner contends that res judicata cannot apply in the instant case since there is no identity of parties

and causes of action between her complaint for forcible entry, which had long become final and

executory, and her subsequent petition for quieting of title. She argues that private respondent Reino

Rosete, who invokes the defense or res judicata, was never impleaded in the forcible entry case, which

is an action in personam; neither was he a purchaser pendente lite who, perhaps, could have validly

invoked the defense of res judicata. With regard to the cause of action, she maintains that there is no

identity of causes of action since the first case was for forcible entry, which is merely concerned with the

possession of the property, whereas the subsequent case was for quieting of title, which looks into theownership of the disputed land.

Private respondent however submits that there is identity of parties in the two cases since he is a

successor in interest by title of the defendant in the first case after the commencement of the first

action. On the issue of identity of causes of action, he simply states that neither of the two cases, i.e.,

the complaint for forcible entry and the subsequent petition for quieting of title, alleges a cause of

action. Thus, private respondent continues, both cases have to be dismissed.



Time and again it has been said that for res judicata to bar the institution of a subsequent action the

following requisites must concur: (1) There must be a final judgment or order; (2) The court rendering

the judgment must have jurisdiction over the subject matter; (3) The former judgment is a judgment on

the merits; and, (4) There is between the first and second actions identity of parties, of subject matter

and of causes of action. 10 The presence of the first three requirements and the identity of subject

matter in the fourth requirement are not disputed. Hence, the only issues remaining are whether as

between Civil Case No. 926 and Civil Case No. 2203-0 there is identity of parties and of causes of action

which would bar the institution of Civil Case No. 2203-0.

Petitioner's argument that there is no identity of parties between the two actions is without merit. We

have repeatedly ruled that for res judicata to apply, what is required is not absolute but only substantial

identity of parties. 11 It is fundamental that the application of res judicata may not be evaded by simply

including additional parties in a subsequent litigation. In fact we have said that there is still identity of

parties although in the second action there is one party who was not joined in the first action, if it

appears that such party is not

a necessary party either in the first or second action, 12 or is a mere nominal party. 13 Thus, Sec. 49,par. (b), Rule 39, Rules of Court, provides that ". . . the judgment or order is, with respect to the matter

directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive

between the parties and their successors in interest by title subsequent to the commencement of the

action or special proceeding, litigating for the same thing and under the same title and in the same

capacity."

In the case at bench, it is evident that private respondent Reino Rosete is a successor in interest of Ben

Babol by title subsequent to the commencement and termination of the first action. Hence, there is

actual, if not substantial, identity of the parties between the two actions. But, there is merit in

petitioner's argument that there is no identity of causes of action between Civil CaseNo. 926 and Civil Case No. 2203-0.

Civil Case No. 926 is a complaint for forcible entry, where what is at issue is prior possession, regardless

of who has lawful title over the disputed property. 14 Thus, "[t]he only issue in an action for forcible

entry is the physical or material possession of real property, that is, possession de facto and not

possession de jure. The philosophy underlying this remedy is that irrespective of the actual condition of

the title to the property, the party in peaceable quiet possession shall not be turned out by strong hand,

violence or terror." 15 And, a judgment rendered in a case for recovery of possession is conclusive only

on the question of possession and not on the ownership. It does not in any way bind the title or affect

the ownership of the land or building. 16

On the other hand, Civil Case No. 2203-0 while inaccurately captioned as an action for "Quieting of Title

and Recovery of Possession with Damages" is in reality an action to recover a parcel of land or an accion

reivindicatoria under Art. 434 17 of the Civil Code, and should be distinguished from Civil Case No. 926,

which is an accion interdictal. From the averments of the complaint in Civil Case No. 2203-0, plaintiff

therein (petitioner herein) clearly sets up title to herself and prays that respondent Rosete be ejected



from the disputed land and that she be declared the owner and given possession thereof. Certainly, the

allegations partake of the nature of an accion reivindicatoria. 18

The doctrine in Emilia v. Bado, 19, decided more than twenty-five years ago, is still good law and has

preserved the age-old remedies available under existing laws and jurisprudence to recover possession of

real property, namely accion interdictal, which is the summary action for forcible entry (detentacion)where the defendant's possession of the property is illegal ab initio, or the summary action for unlawful

detainer (desahuico) where the defendant's possession was originally lawful but ceased to be so by the

expiration of his right to possess, both of which 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, in the proper municipal trial court or metropolitan trial court; 20 accion publiciana which is a

plenary action for recovery of the right to possess and which should be brought in the proper regional

trial court when the dispossession has lasted for more than one year; and, accion

reivindicatoria or accion de reivindicacion which seeks the recovery of ownership and includes thejus

utendi and the jus fruendi brought in the proper regional trial court.

Accion reivindicatoria or accion de reivindicacion is thus an action whereby plaintiff alleges ownership

over a parcel of land and seeks recovery of its full possession. 21 It is different from accion

interdictal or accion publicianawhere plaintiff merely alleges proof of a better right to possess without

claim of title. 22

In Civil Case No. 926 petitioner merely claimed a better right or prior possession over the disputed area

without asserting title thereto. It should be distinguished from Civil Case No. 2203-0 where she expressly

alleged ownership, specifically praying that she be declared the rightful owner and given possession of

the disputed portion. Hence, in Civil Case No. 926 petitioner merely alleged that she was "the true,

lawful (possessor) and in actual, prior physical possession" of the subject parcel of land, whereas in Civil

Case

No. 2203-0 she asserted that she was "the absolute owner in fee simple" of the parcel of land "covered

by Original Transfer Certificate of Title No. P-3259." The complaint in Civil Case No. 2203-0 definitely

raises the question of ownership and clearly gives defendants therein notice of plaintiff's claim of

exclusive and absolute ownership, including the right to possess which is an elemental attribute of such

ownership. Thus, this Court has ruled that a judgment in forcible entry or detainer case disposes of no

other issue than possession and declares only who has the right of possession, but by no means

constitutes a bar to an action for determination of who has the right or title of ownership. 23

And, applying the ruling of the Court En Banc in Quimpo v. De la Victoria, 24 even if we treat Civil Case

No. 2203-0 as a petition to quiet title, as its caption suggests, still it has a cause of action different from

that for ejectment. Consequently, there being no identity of causes of action between Civil Case No. 926

and Civil Case No. 2203-0, the prior complaint for ejectment cannot bar the subsequent action for

recovery, or petition to quiet title.



WHEREFORE, the petition is GRANTED. The Order dated 27 January 1978 of the then Court of First

Instance of Zambales, Br. I, with station in Olongapo City, dismissing Civil Case No. 2203-0, and its

subsequent Order denying reconsideration of the dismissal are REVERSED and SET ASIDE.

The Clerk of Court is directed to remand the records immediately to the court of a quo and the latter to

proceed with the trial of Civil Case No. 2203-0 with deliberate dispatch. This decision is immediatelyexecutory.

SO ORDERED.

SPOUSES WARLITO BUSTOS and HERMINIA REYES-BUSTOS, petitioners, vs. COURT OF APPEALS,

SPOUSES VENANCIO VIRAY and CECILIA NUNGA-VIRAY, respondents.

D E C I S I O N

PARDO, J.:

The case before the Court is an appeal via certiorari seeking to set aside the decision of the Court of

Appeals[1] modifying that of the Regional Trial Court, Pampanga, Macabebe, Branch 55[2] and the

resolution denying reconsideration.[3]

Paulino Fajardo died intestate on April 2, 1957.[4] He had four (4) children, namely: Manuela, Trinidad,

Beatriz and Marcial, all surnamed Fajardo.

On September 30, 1964, the heirs executed an extra-judicial partition[5] of the estate of Paulino

Fajardo. On the same date, Manuela sold her share to Moses[6] G. Mendoza, husband of Beatriz by

deed of absolute sale.[7] The description of the property reads as follows:

“A parcel of an irrigated riceland located in the barrio of San Isidro, Masantol, Pampanga. Bounded on

the North, by Paulino Fajardo; on the East, by Paulino Fajardo; on the South, by Eleuterio Bautista; and

on the West, by Paulino Guintu. Containing an area of 5,253 sq. mts., more or less. Declared under Tax

Declaration No. 3029 in the sum of P710.00.”

At the time of the sale, there was no cadastral survey in Masantol, Pampanga. Later, the cadastre was

conducted, and the property involved in the partition case were specified as Lots 280, 283, 284, 1000-A

and 1000-B. The share of Manuela, which was sold to Moses, includes Lot 284 of the Masantol Cadastre

and Lot 284 was subdivided into Lots 284-A and 284-B.

Trinidad was in physical possession of the land. She refused to surrender the land to her brother-in-law

Moses G. Mendoza, despite several demands.

On September 3, 1971, Moses filed with the Court of First Instance, Pampanga a complaint for partition

claiming the one fourth (¼) share of Manuela which was sold to him.[8]

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During the pendency of the case for partition, Trinidad Fajardo died. On December 15, 1984, the heirs

executed an extra-judicial partition of the estate of Trinidad Fajardo. On February 16, 1987, Lucio

Fajardo Ignacio, son of Trinidad sold Lot 284-B to spouses Venancio Viray and Cecilia Nunga-Viray.

On February 8, 1989, the Regional Trial Court, Pampanga, Macabebe, Branch 55 rendered a decision in

favor of Moses G. Mendoza, the dispositive portion of which provides:

“WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against

the defendants, and hereby orders –

“1. The division and partition of the parcel of land identified and described earlier with the aid and

assistance of a qualified surveyor, segregating therefrom an area equivalent to ¼ portion to be taken

from the vacant right eastern portion which is toward the national road the same to be determined by

one (or the said surveyor) standing on the subject land facing the municipal road, at the expense of the

plaintiffs;

“2. The said ¼ portion segregated shall be a fixed portion, described by metes and bounds, and shall beadjudicated and assigned to the plaintiffs;

“3. In case of disagreement as to where the said right eastern portion should be taken, a commission is

hereby constituted, and the OIC-Clerk of Court is hereby appointed chairman, and the OIC-Branch Clerk

of Court of Branches 54 and 55 of this Court are hereby appointed members, to carry out the orders

contained in the foregoing first two paragraphs;

“4. The defendants to pay the plaintiffs the sum of P500.00 as attorney’s fees, and to pay the costs of

the proceedings.

“SO ORDERED.”[9]

On September 13, 1991, Moses sold the subject land to spouses Warlito Bustos and Herminia Reyes-

Bustos.

In the meantime, on November 6, 1989, spouses Venancio Viray and Cecilia Nunga-Viray, buyers of Lucio

Ignacio’s share of the property, filed with the Municipal Circuit Trial Court, Macabebe-Masantol,

Pampanga an action for unlawful detainer[10] against spouses Bustos, the buyers of Moses G. Mendoza,

who were in actual possession as lessees of the husband of Trinidad, Francisco Ignacio, of the subject

land.

The municipal circuit trial court decided the case in favor of spouses Viray. Subsequently, the trial courtissued writs of execution and demolition, but were stayed when spouses Bustos filed with the Regional

Trial Court, Pampanga, Macabebe, Branch 55,[11] a petition for certiorari, prohibition and injunction.

On December 18, 1992, the regional trial court rendered a decision, the dispositive portion of which

reads:















“WHEREFORE, premises considered, this case, is as it is hereby, dismissed. The preliminary injunction is

ordered dissolved and the petitioners and Meridian Assurance Corporation are hereby ordered jointly

and severally, to pay the private respondents the sum of P20,000.00 by way of litigation expenses and

attorney’s fees, and to pay the cost of the proceedings.”[12]

In time, the spouses Bustos appealed the decision to the Court of Appeals.[13]

On February 27, 1989, Lucio Fajardo Ignacio also appealed the decision to the Court of Appeals.[14]

Upon motion for consolidation of the petitioners, on August 9, 1993, the Court of Appeals resolved to

consolidate CA-G. R. SP No. 30369 and CA-G. R. CV No. 37606.[15]

On August 26, 1994, the Court of Appeals promulgated its decision in the two cases, the dispositive

portion of which provides:

“WHEREFORE, in view of all the foregoing, consolidated judgment is hereby rendered for both CA-G. R.

SP No. 37607 and CA-G. R. SP NO. 30369 as follows:

“1. The appeal docketed as CA-G. R. CV No. 37607 is dismissed; Moses Mendoza is declared as owner of

the ¼ undivided share previously owned by Manuela Fajardo; and the decision of the Regional Trial

Court dated February 8, 1989 in Civil Case No. 83-0005-M is affirmed but MODIFIED as follows:

“WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against

the defendants, and hereby orders –

“1. A relocation survey to be conducted (at the expense of the plaintiffs) to retrace the land subject of

the deed of sale dated September 30, 1964 between Manuela Fajardo and Moses Mendoza;

“2. The division and partition of said relocated land by segregating therefrom an area equivalent to ¼

portion to be taken from the vacant right eastern portion which is toward the national road, the same to

be determined by one standing on the subject land facing the municipal road, at the expense of the

plaintiff-appellees;

“3. The said ¼ portion segregated shall be a fixed portion, described by metes and bounds, and shall be

adjudicated and assigned to the plaintiffs-appellees;

“4. In case of disagreement as to where the said right eastern portion should be taken, a Commission is

hereby constituted, with the OIC/present Clerk of Court as Chairman, and the OIC/present Branch Clerks

of Court of Branches 54 and 55 of the Court (RTC) as members, to carry out and implement the Orderscontained in the second and third paragraphs hereof;

“5. The defendants are ordered to pay the plaintiffs the sum of P500.00 as attorney’s fees, and to pay

the costs of the proceedings.

“2. The dismissal of Civil Case No. 92-0421-M is AFFIRMED but the reasons for its dismissal shall be

effective only as to the issue of possession. CA-G. R. SP No. 30369 is DISMISSED.



















“3. No pronouncement as to costs.

“SO ORDERED.”[16]

On September 9, 1994, petitioners filed a motion for reconsideration;[17] however, on June 21, 1995,

the Court of Appeals denied the motion.[18]

Hence, this petition.[19]

The issue raised is whether petitioners could be ejected from what is now their own land.

The petition is meritorious.

In this case, the issue of possession is intertwined with the issue of ownership. In the unlawful detainer

case, the Court of Appeals affirmed the decision of the trial court as to possession on the ground that

the decision has become final and executory. This means that the petitioners may be evicted. In

the accion reinvindicatoria, the Court of Appeals affirmed the ownership of petitioners over the subject

land. Hence, the court declared petitioners as the lawful owners of the land.

Admittedly, the decision in the ejectment case is final and executory. However, the ministerial duty of

the court to order execution of a final and executory judgment admits of exceptions. In Lipana vs.

Development Bank of Rizal,[20] the Supreme Court reiterated the rule “once a decision becomes final

and executory, it is the ministerial duty of the court to order its execution, admits of certain exceptions

as in cases of special and exceptional nature where it becomes imperative in the higher interest of

justice to direct the suspension of its execution (Vecine v. Geronimo, 59 O. G. 579); whenever it is

necessary to accomplish the aims of justice (Pascual v. Tan, 85 Phil. 164); or when certain facts and

circumstances transpired after the judgment became final which could render the execution of the

judgment unjust (Cabrias v. Adil, 135 SCRA 354).”

In the present case, the stay of execution is warranted by the fact that petitioners are now legal owners

of the land in question and are occupants thereof. To execute the judgment by ejecting petitioners from

the land that they owned would certainly result in grave injustice. Besides, the issue of possession was

rendered moot when the court adjudicated ownership to the spouses Bustos by virtue of a valid deed of

sale.

Placing petitioners in possession of the land in question is the necessary and logical consequence of the

decision declaring them as the rightful owners of the property.[21] One of the essential attributes of

ownership is possession. It follows that as owners of the subject property, petitioners are entitled to

possession of the same. “An owner who cannot exercise the seven (7) “juses” or attributes of

ownership--the right to possess, to use and enjoy, to abuse or consume, to accessories, to dispose or

alienate, to recover or vindicate and to the fruits--is a crippled owner.”[22]

WHEREFORE, we GRANT the petition. We SET ASIDE the decision of the Court of Appeals in CA G. R. SP

No. 30609 for being moot and academic. We AFFIRM the decision of the Court of Appeals in CA G. R. CV

No. 37606.































No costs.

SO ORDERED.

HEIRS OF ROMAN SORIANO, petitioners, vs. THE HONORABLE COURT OF APPEALS, SPOUSES BRAULIO

ABALOS and AQUILINA ABALOS,respondents.

D E C I S I O N

YNARES-SANTIAGO, J.:

May a winning party in a land registration case effectively eject the possessor thereof, whose security of

tenure rights are still pending determination before the DARAB?

The instant petition for certiorari seeks to set aside the Decision[1] dated September 20, 1996 of the

Court of Appeals in CA-G.R. SP No. 34930 as well as its Resolution[2] dated January 15, 1997, denying

petitioners’ Motion for Reconsideration.

We quote the undisputed facts as narrated by the Court of Appeals, to wit –

The property subject of this case is a parcel of land containing an area of 24,550 square meters, more or

less, located in Lingayen, Pangasinan, and particularly described as follows:

A parcel of land (Nipa with an area of 8,410 square meters; fishpond with an area of 14,000 square

meters; and residential land with an area of 1,740 square meters, more or less. Bounded on the N, by

river and Filemon Anselmo; on the South by Alejandro Soriano and Filemon Anselmo; and on the West

by Fortunata Soriano.

Originally owned by Adriano Soriano until his death in 1947, the above-described property passed on tohis heirs who leased the same to spouses David de Vera and Consuelo Villasista for a period of fifteen

(15) years beginning July 1, 1967 with Roman Soriano, one of the children of Adriano Soriano, acting as

caretaker of the property during the period of the lease. After executing an extra judicial settlement

among themselves, the heirs of Adriano Soriano subsequently subdivided the property into two (2) lots,

Lot No. 60052 and Lot No. 8459. Lot No. 60052 was assigned to Lourdes, Candido and the heirs of

Dionisia while Lot No. 8459 was assigned to Francisca, Librada, Elocadio and Roman. In 1971, Lot No.

60052 was sold by Lourdes, Candido and the heirs of Dionisia to petitioner spouses Braulio and Aquilina

Abalos (hereinafter referred to as petitioners), while, Elocadio, Francisca and Librada sold their three-

fourths shares in Lot No. 8459 also to petitioners.

On March 14, 1968, the de Vera spouses ousted Roman Soriano as caretaker and appointed Isidro

Verzosa and Vidal Verzosa as his substitutes. Thereafter, Roman Soriano filed CAR Case No. 1724-P-

68 for reinstatement and reliquidation against the de Vera spouses. The agrarian court authorized the

ejectment of Roman Soriano but on appeal, the decision was reversed by the Court of Appeals, which

decision became final and executory. However, prior to the execution of the said decision, the parties

entered into a post-decisional agreement wherein the de Vera spouses allowed Roman Soriano to sub-

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lease the property until the termination of the lease in 1982. In an Order dated December 22, 1972, the

post-decisional agreement was approved by the agrarian court.

On August 16, 1976, petitioners filed with the Regional Trial Court of Lingayen, Pangasinan, Branch 38,

an application for registration of title over Lot No. 60052 and three-fourths (3/4) pro-indiviso of Lot No.

8459, docketed as LRC Case No. N-3405. Said application for registration was granted by the trial court,acting as a land registration court, per Decision dated June 27, 1983. On appeal, the Court of Appeals

affirmed the decision of the land registration court. The petition for review filed with the Supreme

Court by Roman Soriano docketed as G.R. 70842, was denied for lack of merit and entry of judgment

was entered on December 16, 1985.

Meanwhile, it appears that on July 15, 1983, a day after the promulgation of the land registration court’s

decision, Roman Soriano, together with Elocadio and Librada Soriano, filed before the Regional Trial

Court of Lingayen, Branch 37, and against petitioners, an action for annulment of document and/or

redemption, ownership and damages, docketed as Civil Case No. 159568 (sic; should be

15958). Petitioners filed a motion to dismiss on the ground of res judicata, pendency of another action,

laches, misjoinder of parties and lack of jurisdiction, which was denied by the trial court.

Thereafter, on August 22, 1984, or eleven (11) years after the approval of the post-decisional agreement

between Roman Soriano and the spouses de Vera in CAR Case No. 1724-P-68 for reinstatement and

reliquidation, petitioners filed with the agrarian court a motion for execution of said post-decisional

agreement which allowed Roman Soriano to sub-lease the property. The motion prayed that petitioners

be placed in possession of the subject property, jointly with Roman Soriano, and to levy so much of

Roman’s property to answer for the use and occupation by Soriano of 6/7 share of the property. On

October 25, 1984, Roman Soriano filed a motion to suspend hearing on the rental demanded by

petitioners, which, however, was denied by the agrarian court. The agrarian court likewise authorized

the substitution of the de Vera spouses by petitioners. Soriano’s motion for reconsideration was also

denied, prompting Soriano to file a petition for certiorari with the Court of Appeals.

In the meantime, Roman Soriano died on December 11, 1985. Thus, the complaint in Civil Case No.

159568 (sic) for annulment of document and/or redemption, ownership and damages, was amended to

substitute Soriano’s heirs, herein private respondents, as party-plaintiffs. The complaint was again

amended to include Juanito Ulanday as party-defendant for having allegedly purchased part of the

disputed property from petitioners. On motion of petitioners, the re-amended complaint was dismissed

by the trial court on the ground that the re-amended complaint altered the cause of action. Upon

reconsideration, the dismissal was set aside and petitioners were ordered to file their Answer, in view of

which petitioners filed a petition for certiorari and prohibition with the Court of Appeals, docketed

as C.A. GR SP No. 22149.

On April 25, 1990, the Court of Appeals denied the petition filed by Roman Soriano (substituted by

private respondents) impugning the denial of their motion to suspend hearing on the rental demanded

by petitioners, and authorizing the substitution of the de Vera spouses by petitioners, on the ground



that no grave abuse of discretion was committed by the agrarian court. Thus, private respondents filed

a petition for review on certiorari with the Supreme Court, docketed as G.R. 93401.

Meanwhile, on December 7, 1990, the Court of Appeals in C.A. GR SP No. 22149, also denied the

petition for certiorari and prohibition filed by petitioners, ruling that the land registration court

committed no error when it refused to adhere to the rule of res judicata. Petitioners then filed with theSupreme Court a petition for review on certiorari, docketed as G.R. 99843.

On June 26, 1991, the Supreme Court promulgated its decision in G.R. 93401, and granted the petition

filed by private respondents. Thus, the decision of the Court of Appeals denying the petition of private

respondents was set aside, and the motion for execution filed by petitioners in CAR Case No. 1724-P-

48 was denied.

On June 22, 1993, the Supreme Court, in G.R. 99843, reversed and set aside the denial of the Court of

Appeals in C.A. GR SP No. 22149, and consequently, Civil Case No. 15958 for annulment of document

and/or redemption, ownership and damages, was ordered dismissed.

On October 18, 1993, private respondents filed with the Department of Agrarian Adjudication

Board (sic), a complaint against petitioners for “Security of Tenure with prayer for Status Quo Order and

Preliminary Injunction” docketed as DARAB Case No. 528-P-93.

Meanwhile, it appears that the decision of the land registration court in LRC Case No. N-3405 was

partially executed with the creation of a Committee on Partition per Order dated March 25, 1987. On

July 27, 1988, the land registration court approved the partition of Lot No. 8459, with Lot No. 8459-A

assigned to private respondent, and Lot No. 8459-B assigned to petitioners. For Lot No. 60052, O.C.T.

No. 22670 was issued in the name of petitioners; for Lot No. 8459-B, O.C.T. No. 22687 was issued, also

in the name of petitioner; and for Lot No. 8459-A, O.C.T. No. 22686 was issued in the name of RomanSoriano. Dissatisfied with said partition, private respondents appealed to the Court of Appeals,

docketed as CA G.R. SP No. 119497. The appellate court affirmed the partition but reversed the order of

the land registration court directing the issuance of a writ of possession on the ground of pendency

of Civil Case No. 15958.

On November 15, 1993, the trial court in compliance with the decision of the Supreme Court in G.R. No.

99843, dismissed Civil Case No. 15958, in view of which, petitioner, on November 25, 1993, in LRC Case

No. N-3405, moved for the issuance of an alias writ of execution and/or writ of possession to place them

in possession of Lot No. 60052 and Lot No. 8459-B. Per Resolution dated January 21, 1994, said motion

was held in abeyance by the land registration court until and after DARAB Case No. 528-P-93 for security

of tenure with prayer for status quo, has been resolved.

Their motion for reconsideration having been denied on April 5, 1984, petitioners interposed an appeal

to the Supreme Court, docketed as G.R. 115073. In a Resolution dated July 27, 1994 issued by the

Supreme Court, petitioners’ appeal, which was treated as a petition for certiorari, was referred to this

Court [of Appeals] for determination and disposition.[3]







The Court of Appeals annulled and set aside the Resolution of the land registration court and ordered

instead the issuance of the corresponding writ of possession in favor of private respondents. With the

denial of their Motion for Reconsideration, petitioners are now before us raising the following grounds:

1. THE DECISION AND RESOLUTION OF THE RESPONDENT COURT OF APPEALS ARE CONTRARY TO THE

PROVISIONS OF THE AGRARIAN REFORM LAWS AND JURISPRUDENCE ON THE SECURITY OF TENURE OFTENANT-CARETAKER.

2. THE DECISION AND RESOLUTION OF THE RESPONDENT COURT OF APPEALS ARE VIOLATIVE OF THE

PROVISION ON RIGHT TO DUE PROCESS.

3. THE HONORABLE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION IN GIVING DUE COURSE TO

THE PETITION CONSIDERING THAT PRIVATE RESPONDENTS HAD EARLIER PERFECTED AN APPEAL OF THE

RESOLUTION SUBJECT OF THEIR PETITION.[4]

Possession and ownership are distinct legal concepts. There is ownership when a thing pertaining to

one person is completely subjected to his will in a manner not prohibited by law and consistent with therights of others. Ownership confers certain rights to the owner, among which are the right to enjoy the

thing owned and the right to exclude other persons from possession thereof. On the other hand,

possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to

actually and physically occupy a thing with or without right. Possession may be had in one of two

ways: possession in the concept of an owner and possession of a holder.[5] A person may be declared

owner but he may not be entitled to possession. The possession may be in the hands of another either

as a lessee or a tenant. A person may have improvements thereon of which he may not be deprived

without due hearing. He may have other valid defenses to resist surrender of possession. A judgment

for ownership, therefore, does not necessarily include possession as a necessary incident.[6]

There is no dispute that private respondents’ (petitioners below) title over the land under litigation has

been confirmed with finality. As explained above, however, such declaration pertains only to ownership

and does not automatically include possession, especially so in the instant case where there is a third

party occupying the said parcel of land, allegedly in the concept of an agricultural tenant.

While the issue of ownership of the subject land has been laid to rest in the final judgment of the land

registration court, the right of possession thereof is, as yet, controverted. This is precisely what is put in

issue in the security of tenure case filed by petitioners (private respondents below) before the DARAB.

It is important to note that although private respondents have been declared titled owners of the

subject land, the exercise of their rights of ownership are subject to limitations that may be imposed bylaw.[7] The Tenancy Act provides one such limitation. Agricultural lessees are entitled to security of

tenure and they have the right to work on their respective landholdings once the leasehold relationship

is established. Security of tenure is a legal concession to agricultural lessees which they value as life

itself and deprivation of their landholdings is tantamount to deprivation of their only means of

livelihood.[8] The exercise of the right of ownership, then, yields to the exercise of the rights of an

agricultural tenant.























However, petitioners’ status as tenant has not yet been declared by the DARAB. In keeping with judicial

order, we refrain from ruling on whether petitioners may be dispossessed of the subject property. As

ratiocinated in Nona v. Plan[9] –

It is to the credit of respondent Judge that he has shown awareness of the recent Presidential Decrees

which are impressed with an even more solicitous concern for the rights of the tenants. If, therefore, ashe pointed out in his order granting the writ of possession, there is a pending case between the parties

before the Court of Agrarian Relations, ordinary prudence, let alone the letter of the law, ought to have

cautioned him against granting the plea of private respondents that they be placed in possession of the

land in controversy. x x x. At the time the challenged orders were issued, without any showing of how

the tenancy controversy in the Court of Agrarian Relations was disposed of, respondent Judge could not

by himself and with due observance of the restraints that cabin and confine his jurisdiction pass upon

the question of tenancy. (Emphasis ours)

In its challenged Decision, the Court of Appeals relied heavily on the principle of finality of judgments. It

applied the legal doctrine that once a judgment has become final, the issuance of a writ of execution

becomes ministerial. The appellate court held that petitioner’s situation does not fall under any of the

exceptions to this rule since his occupation of the subject land did not transpire after the land

registration court’s adjudication became final.

In so ruling, however, the Court of Appeals loses sight of the fact that petitioner’s claim of possession as

a tenant of the litigated property, if proven, entitles him to protection against dispossession.

Private respondents argue that petitioners’ tenancy claim is barred by res judicata, having been ruled

upon in G.R. Nos. 99843 and 93401. However, not being an issue in the case before us, this question

should properly be resolved in DARAB Case No. 528-P-93. To restate, the only issue before us is

whether or not a winning party in a land registration case can effectively eject the possessor thereof,whose security of tenure rights are still pending determination before the DARAB.

A judgment in a land registration case cannot be effectively used to oust the possessor of the land,

whose security of tenure rights are still pending determination before the DARAB. Stated differently,

the prevailing party in a land registration case cannot be placed in possession of the area while it is

being occupied by one claiming to be an agricultural tenant, pending a declaration that the latter’s

occupancy was unlawful.

WHEREFORE, the instant petition for certiorari is hereby GRANTED. The Decision of respondent Court of

Appeals in CA-G.R. SP No. 34930 dated September 20, 1996, as well as its Resolution dated January 15,

1997 are SET ASIDE. The Resolution of the Regional Trial Court of Lingayen, Pangasinan in LRC Case No.

N-3405 dated January 21, 1994 is ordered REINSTATED.

SO ORDERED.

G.R. No. L-20264 January 30, 1971






CONSUELO S. DE GARCIA and ANASTACIO GARCIA, petitioners,

vs.

HON. COURT OF APPEALS, ANGELINA D. GUEVARA and JUAN B. GUEVARA, respondents.

Deogracias T. Reyes and Jose M. Luison for petitioners.

Tolentino and Garcia and D.R. Cruz for private respondents.

FERNANDO, J.:

This petition for certiorari to review a decision of respondent Court of Appeals was given due course

because it was therein vigorously asserted that legal questions of gravity and of moment, there being

allegations of an unwarranted departure from and a patent misreading of applicable and controlling

decisions, called for determination by this Tribunal. The brief for petitioners-spouses, however, failed to

substantiate such imputed failings of respondent Court. The performance did not live up to the promise.

On the basis of the facts as duly found by respondent Court, which we are not at liberty to disregard,

and the governing legal provisions, there is no basis for reversal. We affirm.

The nature of the case presented before the lower court by private respondent Angelina D. Guevara,

assisted by her spouse, Juan B. Guevara, as plaintiffs, was noted in the decision of respondent Court of

Appeals thus: "Plaintiff seeks recovery of `one (1) lady's diamond ring 18 cts. white gold mounting, with

one (1) 2.05 cts. diamond-solitaire, and four (4) brills 0.10 cts. total weight' which she bought on

October 27, 1947 from R. Rebullida, Inc."1 Then came a summary of now respondent Guevara of her

evidence: "Plaintiff's evidence tends to show that around October 11, 1953 plaintiff while talking to

Consuelo S. de Garcia, owner of La Bulakeña restaurant recognized her ring in the finger of Mrs. Garcia

and inquired where she bought it, which the defendant answered from her comadre. Plaintiff explained

that that ring was stolen from her house in February, 1952. Defendant handed the ring to plaintiff and it

fitted her finger. Two or three days later, at the request of plaintiff, plaintiff, her husband Lt. Col. Juan

Guevara, Lt. Cementina of Pasay PD, defendant and her attorney proceeded to the store of Mr.

Rebullida to whom they showed the ring in question. Mr. Rebullida a examined the ring with the aid of

high power lens and after consulting the stock card thereon, concluded that it was the very ring that

plaintiff bought from him in 1947. The ring was returned to defendant who despite a written request

therefor failed to deliver the ring to plaintiff. Hence, this case. Later on when the sheriff tried to serve

the writ of seizure (replevin), defendant refused to deliver the ring which had been examined by Mr.

Rebullida, claiming it was lost."2

How the defendant, Consuelo S. de Garcia, the present petitioner before us, along with her husband

Anastacio Garcia, sought to meet plaintiff's claim was narrated thus: "On the other hand, defendant

denied having made any admission before plaintiff or Mr. Rebullida or the sheriff. Her evidence tends to

show that the ring (Exhibit 1) was purchased by her from Mrs. Miranda who got it from Miss Angelita

Hinahon who in turn got it from the owner, Aling Petring, who was boarding in her house; that the ring

she bought could be similar to, but not the same ring plaintiff purchased from Mr. Rebullida which was



stolen; that according to a pawn-shop owner the big diamond on Exhibit 1 was before the trial never

dismantled. When dismantled, defendant's diamond was found to weigh 2.57 cts."3

Plaintiff lost in the lower court. She elevated the matter to respondent Court of Appeals with the

judgment of the lower court being reversed. It is this decision now under review.

These are the facts as found by respondent Court of Appeals: "That the ring brought by the parties for

examination by Rafael Rebullida on December 14, 1953 was the same ring purchased by plaintiff from R.

Rebullida, Inc. on October 27, 1947 and stolen in February, 1952 has been abundantly established by

plaintiff's evidence. Before plaintiff lost the ring, she had been wearing it for six years and became

familiar with it. Thus, when she saw the missing ring in the finger of defendant, she readily and definitely

identified it. Her identification was confirmed by Mr. Rafael Rebullida, whose candid testimony is

entitled to great weight, with his 30 years experience behind him in the jewelry business and being a

disinterested witness since both parties are his customers. Indeed, defendant made no comment when

in her presence Rebullida after examining the ring and stock card told plaintiff that that was her ring, nor

did she answer plaintiff's letter of demand, ... asserting ownership. Further confirmation may be found

in the extra-judicial admissions, contained in defendant's original and first amended answers ..."4

These further facts likewise appeal therein: "The foregoing proof is not counter-balanced by the denial

on the part of defendant or the presentation of the ring, Exhibit I, which has a diamond-solitaire 2.57

cts., or much heavier than the lost diamond weighing 2.05 cts. only. It is noteworthy that defendant

gave a rather dubious source of her ring. Aling Petring from whom the ring supposedly came turned out

to be a mysterious and ephemeral figure. Miss Hinahon did not even know her true and full name, nor

her forwarding address. She appeared from nowhere, boarded three months in the house of Miss

Hinahon long enough to sell her diamond ring, disappearing from the scene a week thereafter. Indeed,

the case was terminated without any hearing on the third-party and fourth-party complaints, which

would have shown up the falsity of defendant's theory. Moreover, Mrs. Baldomera Miranda, third-party

defendant, who tried to corroborate defendant on the latter's alleged attempt to exchange the ring

defendant bought through her, is [belied] by her judicial admission in her Answer that appellee

`suggested that she would make alterations to the mounting and structural design of the ring to hide the

true identity and appearance of the original one' (Cunanan vs. Amparo, 45 O.G. 3796). Finally, defendant

is refuted by her own extra-judicial admissions ... although made by defendant's counsel. For an

attorney who acts as counsel of record and is permitted to act such, has the authority to manage the

cause, and this includes the authority to make admission for the purpose of the litigation... Her

proffered explanation that her counsel misunderstood her is puerile because the liability to error as to

the identity of the vendor and the exchange of the ring with another ring of the same value, was rather

remote."5

It is in the light of the above facts as well as the finding that the discrepancy as to the weight between

the diamond-solitaire in Exhibit I and the lost diamond was due to defendant having "substituted a

diamond-solitaire of plaintiff with a heavier stone" that the decision was rendered, respondent Court

reversing the lower court and ordering defendant, now petitioner Consuelo S. de Garcia, to return



plaintiff's ring or fact value of P1,000.00 and costs, as well as to pay plaintiff P1,000.00 as attorney's fee

and P1,000.00 as exemplary damages. Hence this appeal.

To repeat, there is no occasion to reverse respondent Court. It correctly applied the law to the facts as

found.

1. The controlling provision is Article 559 of the Civil Code. It reads thus: "The possession of movable

property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or

has been unlawfully deprived thereof may recover it from the person in possession of the same. If the

possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good

faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor."

Respondent Angelina D. Guevara, having been unlawfully deprived of the diamond ring in question, was

entitled to recover it from petitioner Consuelo S. de Garcia who was found in possession of the same.

The only exception the law allows is when there is acquisition in good faith of the possessor at a public

sale, in which case the owner cannot obtain its return without reimbursing the price. As authoritative

interpreted in Cruz v. Pahati, 6 the right of the owner cannot be defeated even by proof that there was

good faith by the acquisition by the possessor. There is a reiteration of this principle in Aznar v.

Yapdiangco.7Thus: "Suffice it to say in this regard that the right of the owner to recover personal

property acquired in good faith by another, is based on his being dispossessed without his consent. The

common law principle that where one of two innocent persons must suffer by a fraud perpetrated by

the another, the law imposes the loss upon the party who, by his misplaced confidence, has enabled the

fraud to be committed, cannot be applied in a case which is covered by an express provision of the new

Civil Code, specifically Article 559. Between a common law principle and statutory provision, the latter

must prevail in this jurisdiction."8

2. It is thus immediately apparent that there is no merit to the contention raised in the first assigned

error that her possession in good faith, equivalent to title, sufficed to defeat respondent Guevara's

claim. As the above cases demonstrate, even on that assumption the owner can recover the same once

she can show illegal deprivation. Respondent Court of Appeals was so convinced from the evidence

submitted that the owner of the ring in litigation is such respondent. That is a factual determination to

which we must pay heed. Instead of proving any alleged departure from legal norms by respondent

Court, petitioner would stress Article 541 of the Civil Code, which provides: 'A possessor 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." She would accord to it a greater legal significance than that to which under

the controlling doctrines it is entitled.lâwphî1.ñèt The brief for respondents did clearly point out why

petitioner's assertion is lacking in support not only from the cases but even from commentators. Thus:

"Actually, even under the first clause, possession in good faith does not really amount to title, for the

reason that Art. 1132 of the Code provides for a period of acquisitive prescription for movables through

`uninterrupted possession for four years in good faith' (Art. 1955 of the old Spanish Code, which

provided a period of three years), so that many Spanish writers, including Manresa, Sanchez Roman,

Scaevola, De Buen, and Ramos, assert that under Art. 464 of the Spanish Code (Art. 559 of the New Civil

Code), the title of the possessor is not that of ownership, but is merely a presumptive title sufficient to

serve as a basis of acquisitive prescription (II Tolentino, Civil Code of the Phil. p. 258: IV Manresa,



Derecho Civil Español, 6th Ed., p. 380). And it is for the very reason that the title established by the first

clause of Art. 559 is only a presumptive title sufficient to serve as a basis for acquisitive prescription,

that the clause immediately following provides that `one who has lost any movable or has been

unlawfully deprived thereof, may recover it from the person in possession of the same.' As stated by the

Honorable Justice Jose B. L. Reyes of this Court in Sotto vs. Enage (C.A.), 43 Off. Gaz. 5075, Dec. 1947:

`Article 559 in fact assumes that possessor is as yet not the owner; for it is obvious that where the

possessor has come to acquire indefeasible title by, let us say, adverse possession for the necessary

period, no proof of loss or illegal deprivation could avail the former owner of the chattel. He would no

longer be entitled to recover it under any condition.' "9

The second assigned error is centered on the alleged failure to prove the identity of the diamond ring.

Clearly the question raised is one of the fact. What the Court of Appeals found is conclusive. Again,

petitioner could not demonstrate that in reaching such a conclusion the Court of Appeals acted in an

arbitrary manner. As made mention of in the brief for respondents two disinterested witnesses, Mr.

Rafael Rebullida as well as Lt. Col. Reynaldo Cementina of the Pasay City Police Department, both of

whom could not be accused of being biased in favor of respondent Angelina D. Guevara, did testify as tothe identity of the ring.

The third assigned error of petitioners would find fault with respondent Court relying "on the weakness

of the title or evidence" of petitioner Consuelo S. de Garcia. It is true, in the decision under review,

mention was made of petitioner Consuelo S. de Garcia making no comment when in her presence

Rebullida, after examining the ring the stock card, told respondent Angelina L. Guevara that that was her

ring, nor did petitioner answer a letter of the latter asserting ownership. It was likewise stated in such

decision that there were extra-judicial admissions in the original and first amended answers of

petitioner. In the appraisal of her testimony, respondent Court likewise spoke of her giving a rather

dubious source of her ring, the person from whom she allegedly bought it turning out "to be amysterious and ephemeral figure." As a matter of fact, as set forth a few pages back, respondent Court

did enumerate the flaws in the version given by petitioner. From the weakness of the testimony offered

which, as thus made clear, petitioner, did not even seek to refute, she would raise the legal question

that respondent Court relied on the "weakness of [her] title or evidence" rather than on the proof

justifying respondent Angelina D. Guevara's claim of ownership. Petitioner here would ignore the finding

of fact of respondent Court that such ownership on her part "has been abundantly established" by her

evidence. Again here, in essence, the question raised is one of fact, and there is no justification for us to

reverse respondent Court.

The legal question raised in the fourth assignment of error is that the matter of the substitution of the

diamond on the ring was a question raised for the first time on appeal as it was never put in issue by the

pleadings nor the subject of reception of evidence by both parties and not touched upon in the decision

of the lower court. Why no such question could be raised in the pleadings of respondent Angelina D.

Guevara was clarified by the fact that the substitution came after it was brought for examination to Mr.

Rebullida. After the knowledge of such substitution was gained, however, the issue was raised at the

trial according to the said respondent resulting in that portion of the decision where the lower court

reached a negative conclusion. As a result, in the motion for reconsideration, one of the points raised as



to such decision being contrary to the evidence is the finding that there was no substitution. It is not

necessary to state that respondent Court, exercising its appellate power reversed the lower court. What

was held by it is controlling. What is clear is that there is no factual basis for the legal arguments on

which the fourth assigned error is predicated.

What is said takes care of the fifth assigned error that respondent Court was mistaken in its finding thatthere was such a substitution. Again petitioner would have us pass on a question of credibility which is

left to respondent Court of Appeals. The sixth assigned error would complain against the reversal of the

lower court judgment as well as petitioner Consuelo S. de Garcia being made to pay respondent

Angelina D. Guevara exemplary damages, attorney's fees and costs. The reversal is called for in the light

of the appraisal of the evidence of record as meticulously weighed by respondent Court. As to the

attorney's fees and exemplary damages, this is what respondent Court said in the decision under review:

"Likewise, plaintiff is entitled to recover reasonable attorney's fees in the sum of P1,000, it being just

and equitable under the circumstances, and another P1,000 as exemplary damages for the public good

to discourage litigants from resorting to fraudulent devices to frustrate the ends of justice, as defendant

herein tried to substitute the ring, Exhibit 1, for plaintiff's ring." 10 Considering the circumstances, thecursory discussion of the sixth assigned error on the matter by petitioner fails to demonstrate that

respondent Court's actuation is blemished by legal defects.

RODIL ENTERPRISES, INC., petitioner, vs. COURT OF APPEALS, CARMEN BONDOC, TERESITA BONDOC-

ESTO, DIVISORIA FOOTWEAR and CHUA HUAY SOON, respondents.

[G.R. No. 135537. November 29, 2001]

RODIL ENTERPRISES, INC., petitioner, vs. IDES O'RACCA BUILDING TENANTS ASSOCIATION,

INC., respondent.

D E C I S I O N

BELLOSILLO, J.:

These twin petitions filed under Rule 45 seek to set aside the Decisions of the Court of Appeals in CA-

G.R. Nos. 39919, 36381 and 37243.

Petitioner Rodil Enterprises Inc. (RODIL) is the lessee of the Ides O'Racca Building (O'RACCA) since

1959.[1] It was a "former alien property" over which the Republic of the Philippines acquired ownership

by virtue of RA 477, as amended.[2]

Sometime in 1980 RODIL entered into a sublease contract with respondents Carmen Bondoc, Teresita

Bondoc-Esto, Divisoria Footwear and Chua Huay Soon,[3] members of the Ides O'Racca Building Tenants

Association Inc. (ASSOCIATION).

On 4 September 1972 the lease contract between RODIL and the REPUBLIC was renewed for another

fifteen (15) years.[4] At that time the O'RACCA was under the administration of the Building Services

and Real Property Management Office (BSRPMO) then headed by Director Jesus R. Factora.[5]

http://sc.judiciary.gov.ph/jurisprudence/2001/nov2001/129609.htm#_edn1






















On 12 September 1982 BP 233[6] was enacted. It authorized the sale of "former alien properties"

classified as commercial and industrial, and the O'RACCA building was classified as commercial

property.[7]

On 8 January 1987 RODIL offered to purchase the subject property conformably with BP 233 and the

REPUBLIC responded that its offer to purchase would be acted upon once the Committee on Appraisalshall have determined the market value of the property.[8]

On 22 July 1997 the ASSOCIATION also offerred to lease the same building through the Department of

General Services and Real Estate Property Management (DGSREPM).[9]

Pending action on the offer of RODIL to purchase the property, Director Factora of the BSRPMO granted

RODIL’s request for another renewal of the lease contract on 23 September 1987 for another five (5)

years from 1 September 1987.[10] The renewal contract was forwarded to then Secretary Jose de Jesus

of DGSREPM for approval.

On 25 September 1987 Undersecretary of DGSREPM Rufino B. Banas recommended to Secrectary DeJesus the suspension of the approval of the renewal contract because the offer of the ASSOCIATION was

more beneficial to the REPUBLIC.

Resultantly, on 30 September 1987 Secretary De Jesus issued another memorandum to Director Factora

disapproving the renewal contract in favor of RODIL, at the same time recalling all papers signed by him

regarding the subject. Secretary De Jesus likewise directed RODIL to pay its realty tax delinquency and

ordered the issuance of a temporary occupancy permit to the ASSOCIATION.[11]

On 6 October 1987 RODIL filed an action for specific performance, damages and injunction with prayer

for temporary restraining order before the Regional Trial Court of Manila against the REPUBLIC, De

Jesus, Banas, Factora and the ASSOCIATION.[12] RODIL prayed that a restraining order be issued

enjoining the ASSOCIATION or any person acting under it from collecting rentals from the occupants or

sub-lessees of O'RACCA. On 26 October 1987 the trial court granted the writ of preliminary

injunction.[13] On appeal, the Court of Appeals upheld the issuance of the writ of preliminary injunction

and ordered the deposit of the monthly rentals with the lower court pendente lite.

On 20 November 1987 the REPUBLIC, De Jesus, Banas and Factora filed their Answer with Counterclaim

for damages. On 21 December 1987 the ASSOCIATION also filed its Answer with Counterclaim for

damages.

De Jesus, Banas and Factora were later substituted by Secretary Fulgencio Factoran of the Departmentof Environment and Natural Resources (DENR) in the action for specific performance. On 31 May 1988

Factoran issued Order No. 1 designating the Land Management Bureau represented by Director

Abelardo Palad, Jr. as custodian of all "former alien properties" owned by the REPUBLIC.

On 18 May 1992 RODIL signed a renewal contract with Director Palad which was approved by Secretary

Factoran.[14] The renewal contract would extend the lease for ten (10) years from 1 September 1987. A






































supplement to the renewal contract was subsequently entered into on 25 May 1992 where rentals on

the previous lease contract were increased.[15]

On 14 August 1972 the action for specific performance was dismissed by the trial court upon joint

motion to dismiss by RODIL and the Solicitor General. The order of dismissal however was appealed by

the ASSOCIATION to the Court of Appeals.[16]

On 25 September 1992 the spouses Saturnino Alvarez and Epifania Alvarez, sublessees of RODIL, filed

with the Office of the President a letter-appeal assailing the authority of Factoran to enter into the

renewal contract of 18 May 1992 with RODIL, and claiming the right to purchase the subject

property.[17]

While the appeal of the ASSOCIATION from the order of dismissal and the letter-appeal of the spouses

Alvarez were pending, the ASSOCIATION instituted Civil Case No. 92-63833 with the Regional Trial Court

of Manila[18] praying for the setting aside of the renewal contract of 18 May 1992 as well as the

supplementary contract of 25 May 1992, and further praying for the issuance of a writ of preliminary

injunction. On 3 May 1993 the trial court denied the prayer for preliminary injunction.

On 30 July 1993 RODIL filed an action for unlawful detainer against Divisoria Footwear,[19] and on 4

August 1993, a similar action against Chua Huay Soon.[20]

On 10 September 1993 the trial court dismissed the action for declaration of nullity of the lease contract

filed by the ASSOCIATION on the ground of litis pendentia.[21] The Order stated that the action for

declaration of nullity and the action for specific performance filed by RODIL were practically between

the same parties and for the same causes of action.[22] This Order was appealed by the ASSOCIATION to

the Court of Appeals.[23]

On 19 January 1994 RODIL filed an action for unlawful detainer against respondent Teresita Bondoc-

Esto,[24] and on 1 February 1994 filed another action against respondent Carmen Bondoc,[25] both with

the Metropolitan Trial Court of Manila.

On 8 February 1994 the Office of the President through Executive Secretary Teofisto Guingona Jr. denied

the letter-appeal of the spouses Alvarez, but nullified the renewal contract of 18 May 1992 and the

supplementary contract of 25 May 1992.[26]

Meanwhile, the Metropolitan Trial Court of Manila upheld RODIL's right to eject respondents Bondoc,

Bondoc-Esto, Divisoria Footwear and Chua Huay Soon,[27] as promulgated in separate decisions the

dispositive portions of which read -

IN CIVIL CASE NO. 143301 -

WHEREFORE, IN VIEW OF THE FOREGOING, judgment is hereby rendered in favor of the plaintiff [RODIL

ENTERPRISES, INC.] and against the defendant [CARMEN BONDOC], to wit: 1. Ordering the defendant

and all those claiming title under her to vacate the subleased portion of the O’Racca Building, corner

Folgueras and M. de los Santos Streets, Binondo, Manila; 2. Ordering the defendant to pay plaintiff the






















































back rentals from October 1987 to August 1992 at the rate of P2,665.00 per month and from September

1992 at the rate of P2,665.00 per month plus a yearly increase of 20% per month up to the time that she

vacates the premises; 3. Ordering the defendant to pay the amount ofP10,000.00 as attorney’s fees

and to pay the cost of suit.


WHEREFORE, judgment is hereby rendered in favor of the plaintiff [RODIL ENTERPRISES, INC.] as against

the defendant [TERESITA BONDOC ESTO] ordering the defendant and all persons claiming rights under

her to vacate the premises at O’Racca Building located at corner Folgueras and M. de los Santos Streets,

Binondo, Manila, and turn over the possession thereof to plaintiff; ordering the defendant to pay

plaintiff the amount of P29,700.00 as rental in arrears for the period from September 1992 plus legal

rate of interest less whatever amount deposited with the Court; ordering defendant to pay the sum of

P3,000.00 as reasonable compensation for the use and occupancy of the premises from January 1994

until defendant shall have finally vacated the premises minus whatever amount deposited with the

Court as rental; ordering defendant to pay reasonable attorney’s fees in the amount of P2,000.00 and

the costs of suit.


WHEREFORE, judgment is hereby rendered in favor of plaintiff [RODIL ENTERPRISES, INC.], ordering

defendant [DIVISORIA FOOTWEAR], its representatives, agents, employees and/or assigns to vacate the

leased premises or portion of the Ides O’Racca Building presently occupied by said defendant and to pay

plaintiff the following: a) Rentals in arrears from October 1987 to June 1993 in the amount of

P521,000.00; b) Rentals in the amount of P9,000.00 a month from July, 1993 until defendant will have

vacated the premises; c) Attorney’s fees in the amount of P15,000.00; d) Costs of suit.

IN CIVIL CASE NO. 142282-CV -

IN VIEW THEREOF, judgment is hereby rendered ordering: 1. defendant CHUA HUAY SOON and all

persons claiming rights through him, to vacate the premises occupied by him at O’RACCA Building,

located at the corner of Folgueras and M. delos Santos Street, Binondo, Manila, and turn over

possession thereof to plaintiff RODIL ENTERPRISES, INC.; 2. defendant to pay rentals in arrears from

October 1987 up to June 1993 at the rate of P6,175.00 a month, representing the rentals in arrears; 3.

defendant to pay P6,175.00 per month from July 1993 until he vacates the premises, as reasonable

compensation for the use of the premises; 4. defendant to pay the sum of P20,000.00 as attorney’s fees;

5. defendant to pay interests on the amounts mentioned in Nos. 2 and 3 above at ten (10%) percent per

annum from the date of the filing of the complaint until said amounts are fully paid; and, 6. defendant

to pay the costs.

The Regional Trial Court affirmed the Metropolitan Trial Court[28] in all the four (4) decisions above

quoted. Thus, respondents Bondoc, Bondoc-Esto and Divisoria Footwear subsequently filed a Petition

for Review with the Court of Appeals,[29] followed by respondent Chua Huay Soon.[30]















While the consolidated appeals from the unlawful detainer cases were pending, the Second Division of

the Court of Appeals promulgated its decision on 12 April 1996 with regard to CA-G.R. No. 39919

declaring the renewal contract between RODIL and the REPUBLIC null and void.[31] RODIL moved for

reconsideration but its motion was denied.[32] Hence, this petition for review on certiorari under Rule

45.[33]

On 29 November 1996 the Special Fourth Division of the Court of Appeals promulgated its Decision in

CA-G.R. No. 36381 and CA-G.R. No. 37243 setting aside the decisions of the Regional Trial Court, which

sustained the Metropolitan Trial Court, and dismissing the action for unlawful detainer filed by RODIL

against its lessees.[34] RODIL moved for reconsideration but the motion was denied.[35] Hence, this

petition for review on certiorari.[36]

On respondents' motion, G.R. Nos. 129609 and 135537 were consolidated.

RODIL now contends that the Court of Appeals erred in annulling its renewal contract with the REPUBLIC

and in dismissing its actions for unlawful detainer against respondents Bondoc, Bondoc-Esto, Divisoria

Footwear and Chua. RODIL claims that the assailed contracts are neither void nor voidable as the facts

show they do not fall within the enumerations under Arts. 1305 and 1409, and an implied new lease still

exists by virtue of Art. 1670. As a result, the right to eject respondents properly belongs to it.[37]

With regard to CA-G.R. No. 39919, RODIL argues that the REPUBLIC, the only defendant who is a real

party in interest, signified its assent to having the action dismissed. Assuming arguendo that the

ASSOCIATION was a real party in interest, its counterclaim was nonetheless unmeritorious.[38]

On the other hand, respondents Bondoc, Bondoc-Esto, Divisoria Footwear and Chua contend that the

lease contract which the lease contract of 18 May 1992 was to renew, never came into

existence. Therefore, since there was no contract to "renew," the renewal contract had no leg to standon, hence, is also void.[39] Respondents then conclude that since there was no lease contract to speak

of, RODIL had no right to relief in its action for unlawful detainer. The ASSOCIATION, for its part, argues

that the counterclaim it filed against RODIL cannot be dismissed because the trial court has not passed

upon it.[40]

We rule for RODIL. The owner has the right to enjoy and dispose of a thing, without other limitations

than those established by law.[41] Every owner has the freedom of disposition over his property. It is

an attribute of ownership, and this rule has no exception. The REPUBLIC being the owner of the

disputed property enjoys the prerogative to enter into a lease contract with RODIL in the exercise of

its jus disponendi. Hence, as lessor, the REPUBLIC has the right to eject usurpers of the leased property

where the factual elements required for relief in an action for unlawful detainer are present.

Private respondents claim that the agreements of 23 September 1987, 18 May 1992 and 25 May 1992

did not give rise to valid contracts.[42] This is true only of the Contract of Lease entered into on 23

September 1987 which the REPUBLIC did not approve. RODIL neither alleged nor proved that such

approval was made known to it. The so-called approval of the lease contract was merely stated in an

internal memorandum of Secretary De Jesus addressed to Director Factora.[43] This is evident from the























































fact that Secretary De Jesus, in his letter, asked Factora to duly execute a lease contract and forward it

to his office for approval.[44] The consequences of this fact are clear. The Civil Code provides that no

contract shall arise unless acceptance of the contract is communicated to the offeror.[45] Until that

moment, there is no real meeting of the minds, no concurrence of offer and acceptance, hence, no

contract.[46]

However, the same is not true of the contracts of 18 May 1992 and 25 May 1992. As argued by RODIL,

these contracts are not proscribed by law; neither is there a law prohibiting the execution of a contract

with provisions that are retroactive. Where there is nothing in a contract that is contrary to law, morals,

good customs, public policy or public order, the validity of the contract must be sustained.[47]

The Court of Appeals invalidated the contracts because they were supposedly executed in violation of a

temporary restraining order issued by the Regional Trial Court.[48] The appellate court however failed

to note that the order restrains the REPUBLIC from awarding the lease contract only as regards

respondent ASSOCIATION but not petitioner RODIL. While a temporary restraining order was indeed

issued against RODIL, it was issued only on 25 May 1992 or after the assailed contracts were entered

into. As correctly stated by petitioner, one cannot enjoin an act already fait accompli.[49]

Private respondents argue that the "renewal contract" cannot "renew" a void contract. However, they

could cite no legal basis for this assertion. It would seem that respondents consider the renewal

contract to be a novation of the earlier lease contract of 23 September 1987. However, novation is

never presumed.[50] Also, the title of a contract does not determine its nature. On the contrary, it is

the specific provisions of the contract which dictate its nature.[51] Furthermore, where a contract is

susceptible of two (2) interpretations, one that would make it valid and another that would make it

invalid, the latter interpretation is to be adopted.[52] The assailed agreement of 18 May 1992, "Renewal

of Contract of Lease," merely states that the term of the contract would be for ten (10) years starting 1

September 1987. This is hardly conclusive of the existence of an intention by the parties to novate the

contract of 23 September 1987. Nor can it be argued that there is an implied novation for the requisite

incompatibility between the original contract and the subsequent one is not present.[53] Based on this

factual milieu, the presumption of validity of contract cannot be said to have been overturned.

Respondent ASSOCIATION claims that the Decision of the Office of the President declaring null and void

the lease contracts of 18 May 1992 and 25 May 1992 should be counted in its favor.

We do not agree. The contention does not hold water. It is well-settled that a court's judgment in a

case shall not adversely affect persons who were not parties thereto.

Respondent ASSOCIATION finally argues that the 18 May 1992 and 25 May 1992 contracts can be

considered rescissible because they concern property under litigation and were entered into without

the knowledge and approval of the litigants or of competent judicial authority.[54] Civil Case No. 87-

42323 involved an action for specific performance and damages filed by RODIL against the REPUBLIC and

the ASSOCIATION. The right to file the action for rescission arises in favor of the plaintiff when the

defendant enters into a contract over the thing under litigation without the knowledge and approval of















































the plaintiff or the court. The right of action therefore arose in favor of petitioner RODIL and not

respondent ASSOCIATION.

Having preliminarily dealt with the validity of the lease contracts, we now proceed to resolve the issue

raised by respondent ASSOCIATION with regard to its counterclaim.

The ASSOCIATION argues that its counterclaim should not have been dismissed. On this point, we

agree. The requisites for the application of Rule 17 of the Rules of Civil Procedure are clearly

present.[55] The counterclaim is necessarily connected with the transaction that is the subject matter of

the claim. In malicious prosecution, there must be proof that the prosecution was prompted by a

sinister design to vex and humiliate a person, and that it was initiated deliberately by the defendant

knowing that his charge was false and groundless.[56] A determination of whether the charge is

groundless would necessarily involve an analysis of whether the action instituted by RODIL is

meritorious. The counterclaim did not require the presence of third parties over which the court could

not acquire jurisdiction, and that the court had jurisdiction over the subject matter of the counterclaim

since the amount of damages claimed by the ASSOCIATION in its counterclaim amounted

to P3,500,000.00, clearly within the jurisdictional amount for the Regional Trial Court under BP 129.

However, in the interest of making a final adjudication on an issue which has been pending for fourteen

(14) years, we will rule on the issues raised by the ASSOCIATION in its counterclaim, and accordingly

deny the same, dispensing with any discussion regarding the merits of RODIL's cause of action which is

clearly neither "false" nor "groundless." Therefore, the elements of malicious prosecution are absent.

As regards the action for unlawful detainer, respondents Bondoc, Bondoc-Esto, Divisoria Footwear and

Chua argue that this should not prosper because RODIL is not in actual possession of the property and

because they are not its sublessees.[57] Their arguments do not convince.

In an action for unlawful detainer the plaintiff need not have been in prior physical

possession. Respondents have admitted that they have not entered into any lease contract with the

REPUBLIC and that their continued occupation of the subject property was merely by virtue of

acquiescence.[58] The records clearly show this to be the case. The REPUBLIC merely issued a

"temporary occupancy permit" which was not even in the name of the respondents Bondoc, Bondoc-

Esto, Divisoria Footwear or Chua but of respondent ASSOCIATION. Since the occupation of respondents

was merely tolerated by the REPUBLIC, the right of possession of the latter remained uninterrupted. It

could therefore alienate the same to anyone it chose. Unfortunately for respondents, the REPUBLIC

chose to alienate the subject premises to RODIL by virtue of a contract of lease entered into on 18 May

1992. Resultantly, petitioner had the right to file the action for unlawful detainer against respondentsas one from whom possession of property has been unlawfully withheld.

Respondents finally argue that petitioner failed to comply with the mandatory provisions of Rule 45 so

that its petition must be dismissed. They allege that petitioner failed to state in its petition that a

motion for reconsideration was filed, the date of filing, when the motion was denied, and the date when

the resolution denying the motion was received.



















A cursory review of RODIL's petition belies respondents' assertion. All dates required under Rule 45,

Sec. 4, are properly indicated except when the motion for reconsideration was filed. Procedural rules

are required to be followed as a general rule, but they may be relaxed to relieve a litigant of an injustice

not commensurate with the degree of his noncompliance with the procedure required. Dismissal of

appeals purely on technical grounds is frowned upon and the rules of procedure ought not to be applied

in a very rigid, technical sense, for they are adopted to help secure, not override, substantial justice, and

thereby defeat their very aims. The rules have been drafted with the primary objective of enhancing fair

trials and expediting the proper dispensation of justice. As a corollary, if their application and operation

tend to subvert and defeat, instead of promote and enhance its objective, suspension of the rules is

justified.[59] Petitioner did not repeat its error in its later petition filed under G.R. No. 135537. The

oversight must be fashioned with leniency.

WHEREFORE, the consolidated petitions are GRANTED. The assailed Decisions of the Court of Appeals in

CA-G.R. Nos. 36381, 37243 and 39919 are REVERSED and SET ASIDE. Accordingly, the Decisions of the

Regional Trial Court, Br. 39, in Civil Cases Nos. 94-70776, 94-71122 and 94-71123 as well as the Decision

of the Regional Trial Court, Br. 23, in Civil Case No. 94-72209 affirming in toto the Decisions of the MeTC- Br. 28 in Civil Case No. 143301, MeTC - Br. 15 in Civil Case No. 143216, MeTC - Br. 7 in Civil Case No.

142258, and MeTC - Br. 24 in Civil Case No. 142282-CV, as herein quoted, and the Orders dated 14

August 1992 and 6 November 1992 of the Regional Trial Court, Br. 8 in Civil Case No. 87-42323,

recognizing the validity and legality of the Renewal of the Lease Contract dated 18 May 1992 and the

Supplemental Contract dated 25 May 1992, are REINSTATED, AFFIRMED and ADOPTED. Costs against

private respondents in both cases.

SO ORDERED.

CORNELIO M. ISAGUIRRE, petitioner, vs. FELICITAS DE LARA, respondent.

D E C I S I O N

GONZAGA-REYES, J.:

In this petition for review on certiorari under Rule 45 of the 1997 Revised Rules of Civil Procedure,

petitioner Cornelio M. Isaguirre assails the October 5, 1998 decision[1] of the Court of Appeals[2]and its

Resolution promulgated on March 5, 1999.

The antecedent facts of the present case are as follows:

Alejandro de Lara was the original applicant-claimant for a Miscellaneous Sales Application over a parcelof land identified as portion of Lot 502, Guianga Cadastre, filed with the Bureau of Lands on January 17,

1942 and with an area of 2,342 square meters. Upon his death, Alejandro de Lara was succeeded by his

wife - respondent Felicitas de Lara, as claimant. On November 19, 1954, the Undersecretary of

Agriculture and Natural Resources amended the sales application to cover only 1,600 square meters.

Then, on November 3, 1961, by virtue of a decision rendered by the Secretary of Agriculture and Natural

Resources dated November 19, 1954, a subdivision survey was made and the area was further reduced




http://sc.judiciary.gov.ph/jurisprudence/2000/may2000/138053.htm#_ftn1











to 1,000 square meters. On this lot stands a two-story residential-commercial apartment declared for

taxation purposes under TD 43927 in the name of respondent’s sons - Apolonio and Rodolfo, both

surnamed de Lara.

Sometime in 1953, respondent obtained several loans from the Philippine National Bank. When she

encountered financial difficulties, respondent approached petitioner Cornelio M. Isaguirre, who wasmarried to her niece, for assistance. On February 10, 1960, a document denominated as "Deed of Sale

and Special Cession of Rights and Interests" was executed by respondent and petitioner, whereby the

former sold a 250 square meter portion of Lot No. 502, together with the two-story commercial and

residential structure standing thereon, in favor of petitioner, for and in consideration of the sum of

P5,000.

Sometime in May, 1968, Apolonio and Rodolfo de Lara filed a complaint against petitioner for recovery

of ownership and possession of the two-story building.[3] However, the case was dismissed for lack of

jurisdiction.

On August 21, 1969, petitioner filed a sales application over the subject property on the basis of the

deed of sale. His application was approved on January 17, 1984, resulting in the issuance of Original

Certificate of Title No. P-11566 on February 13, 1984, in the name of petitioner. Meanwhile, the sales

application of respondent over the entire 1,000 square meters of subject property (including the 250

square meter portion claimed by petitioner) was also given due course, resulting in the issuance of

Original Certificate of Title No. P-13038 on June 19, 1989, in the name of respondent.[4]

Due to the overlapping of titles, petitioner filed an action for quieting of title and damages with the

Regional Trial Court of Davao City against respondent on May 17, 1990. The case was docketed as Civil

Case No. 20124-90. After trial on the merits, the trial court rendered judgment on October 19, 1992, in

favor of petitioner, declaring him to be the lawful owner of the disputed property. However, the Courtof Appeals reversed the trial court’s decision, holding that the transaction entered into by the parties, as

evidenced by their contract, was an equitable mortgage, not a sale.[5] The appellate court’s decision

was based on the inadequacy of the consideration agreed upon by the parties, on its finding that the

payment of a large portion of the "purchase price" was made after the execution of the deed of sale in

several installments of minimal amounts; and finally, on the fact that petitioner did not take steps to

confirm his rights or to obtain title over the property for several years after the execution of the deed of

sale. As a consequence of its decision, the appellate court also declared Original Certificate of Title No.P-

11566 issued in favor of petitioner to be null and void. On July 8, 1996, in a case docketed as G. R. No.

120832, this Court affirmed the decision of the Court of Appeals and on September 11, 1996, we denied

petitioner’s motion for reconsideration.

On May 5, 1997, respondent filed a motion for execution with the trial court, praying for the immediate

delivery of possession of the subject property, which motion was granted on August 18, 1997. On

February 3, 1998, respondent moved for a writ of possession, invoking our ruling in G. R. No. 120832.

Petitioner opposed the motion, asserting that he had the right of retention over the property until

payment of the loan and the value of the improvements he had introduced on the property. On March















12, 1998, the trial court granted respondent’s motion for writ of possession. Petitioner’s motion for

reconsideration was denied by the trial court on May 21, 1998. Consequently, a writ of possession dated

June 16, 1998, together with the Sheriff’s Notice to Vacate dated July 7, 1998, were served upon

petitioner.

Petitioner filed with the Court of Appeals a special civil action for certiorari and prohibition with prayerfor a temporary restraining order or preliminary injunction to annul and set aside the March 12, 1998

and May 21, 1998 orders of the trial court, including the writ of possession dated June 16, 1998 and the

sheriff’s notice to vacate dated July 7, 1998.[6]

The appellate court summarized the issues involved in the case as follows: (1) whether or not the

mortgagee in an equitable mortgage has the right to retain possession of the property pending actual

payment to him of the amount of indebtedness by the mortgagor; and (b) whether or not petitioner can

be considered a builder in good faith with respect to the improvements he made on the property before

the transaction was declared to be an equitable mortgage.

The Court of Appeals held that petitioner was not entitled to retain possession of the subject property. It

said that -

… the mortgagee merely has to annotate his claim at the back of the certificate of title in order to

protect his rights against third persons and thereby secure the debt. There is therefore no necessity for

him to actually possess the property. Neither should a mortgagee in an equitable mortgage fear that the

contract relied upon is not registered and hence, may not operate as a mortgage to justify its

foreclosure. In Feliza Zubiri v. Lucio Quijano, 74 Phil 47, it was ruled "that when a contract x x x is held as

an equitable mortgage, the same shall be given effect as if it had complied with the formal requisites of

mortgage. x x x by its very nature the lien thereby created ought not to be defeated by requiring

compliance with the formalities necessary to the validity of a voluntary real estate mortgage, as long asthe land remains in the hands of the petitioner (mortgagor) and the rights of innocent parties are not

affected."

Proceeding from the foregoing, petitioner’s imagined fears that his lien would be lost by surrendering

possession are unfounded.

In the same vein, there is nothing to stop the mortgagor de Lara from acquiring possession of the

property pending actual payment of the indebtedness to petitioner. This does not in anyway endanger

the petitioner’s right to security since, as pointed out by private respondents, the petitioner can always

have the equitable mortgage annotated in the Certificate of Title of private respondent and pursue the

legal remedies for the collection of the alleged debt secured by the mortgage. In this case, the remedy

would be to foreclose the mortgage upon failure to pay the debt within the required period.

It is unfortunate however, that the Court of Appeals, in declaring the transaction to be an equitable

mortgage failed to specify in its Decision the period of time within which the private respondent could

settle her account, since such period serves as the reckoning point by which foreclosure could ensue. As

it is, petitioner is now in a dilemma as to how he could enforce his rights as a mortgagee. ...







Hence, this Court, once and for all resolves the matter by requiring the trial court to determine the

amount of total indebtedness and the period within which payment shall be made.

Petitioner’s claims that he was a builder in good faith and entitled to reimbursement for the

improvements he introduced upon the property were rejected by the Court of Appeals. It held that

petitioner knew, or at least had an inkling, that there was a defect or flaw in his mode of acquisition.Nevertheless, the appellate court declared petitioner to have the following rights:

…He is entitled to reimbursement for the necessary expenses which he may have incurred over the

property, in accordance with Art. 526 and Art. 452 of the Civil Code. Moreover, considering that the

transaction was merely an equitable mortgage, then he is entitled to payment of the amount of

indebtedness plus interest, and in the event of non-payment to foreclose the mortgage. Meanwhile,

pending receipt of the total amount of debt, private respondent is entitled to possession over the

disputed property.

The case was finally disposed of by the appellate court in the following manner:

WHERFORE, the Petition is hereby DISMISSED, and this case is ordered remanded to the Regional Trial

Court of Davao City for further proceedings, as follows:

1) The trial court shall determine –

a) The period within which the mortgagor must pay his total amount of indebtedness.

b) The total amount of indebtedness owing the petitioner-mortgagee plus interest computed from the

time when the judgment declaring the contract to be an equitable mortgage became final.

c) The necessary expenses incurred by petitioner over the property.[7]

On March 5, 1999, petitioner’s motion for reconsideration was denied by the appellate court.[8] Hence,

the present appeal wherein petitioner makes the following assignment of errors:

A.......THE HONORABLE COURT OF APPEALS ERRED IN NOT RULING THAT THE RTC ACTED WITHOUT OR

IN EXCESS OF ITS JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR

EXCESS OF JURISDICTION IN ISSUING A WRIT OF POSSESSION IN FAVOR OF RESPONDENT.

A.1......The RTC patently exceeded the scope of its authority and acted with grave abuse of discretion in

ordering the immediate delivery of possession of the Property to respondent as said order exceeded the

parameters of the final and executory decision and constituted a variance thereof.

B.......THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER IS NOT ENTITLED TO

THE POSSESSION OF THE PROPERTY PRIOR TO THE PAYMENT OF RESPONDENT’S MORTGAGE LOAN.

C.......THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT PETITIONER WAS NOT A BUILDER IN

GOOD FAITH.











D.......THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT PETITIONER IS ENTITLED TO

INTEREST COMPUTED ONLY FROM THE TIME WHEN THE JUDGMENT DECLARING THE CONTRACT TO BE

AN EQUITABLE MORTGAGE BECAME FINAL.[9]

Basically, petitioner claims that he is entitled to retain possession of the subject property until payment

of the loan and the value of the necessary and useful improvements he made upon suchproperty.[10] According to petitioner, neither the Court of Appeals’ decision in G.R. CV No. 42065 nor

this Court’s decision in G.R. No. 120832 ordered immediate delivery of possession of the subject

property to respondent.

The dispositive portion of the March 31, 1995 decision of the Court of Appeals in G.R. CV No. 42065,

which was affirmed by this Court, provides that –

IN VIEW OF ALL THE FOREGOING, the judgment appealed from is REVERSED and SET ASIDE and a new

one entered: (1) dismissing the complaint; (2) declaring the "Document of Sale and Special Cession of

Rights and Interests" (Exhibit B) dated February 10, 1960, to be an equitable mortgage not a sale; (3)

upholding the validity of OCT No. P-13038 in the name of Felicitas de Lara; and (3) declaring null and

void OCT No. P-11566 in the name of plaintiff Cornelio Isaguirre. All other counterclaims for damages

are likewise dismissed. Costs against the appellee.[11]

Petitioner argues that the abovementioned decision merely settled the following matters: (1) that the

transaction between petitioner and respondent was not a sale but an equitable mortgage; (2) that OCT

No. P-13038 in the name of respondent is valid; and (3) that OCT No. P-11566 in the name of petitioner

is null and void. Since the aforementioned decision did not direct the immediate ouster of petitioner

from the subject property and the delivery thereof to respondent, the issuance of the writ of possession

by the trial court on June 16, 1998 constituted an unwarranted modification or addition to the final and

executory decision of this Court in G.R. No. 120832.[12]

We do not agree with petitioner’s contentions. On the contrary, the March 31, 1995 decision of the

appellate court, which was affirmed by this Court on July 8, 1996, served as more than adequate basis

for the issuance of the writ of possession in favor of respondent since these decisions affirmed

respondent’s title over the subject property. As the sole owner, respondent has the right to enjoy her

property, without any other limitations than those established by law.[13] Corollary to such right,

respondent also has the right to exclude from the possession of her property any other person to whom

she has not transmitted such property.[14]

It is true that, in some instances, the actual possessor has some valid rights over the property

enforceable even against the owner thereof, such as in the case of a tenant or lessee.[15] Petitioner

anchors his own claim to possession upon his declared status as a mortgagee. In his Memorandum, he

argues that –

4.8 It was respondent who asserted that her transfer of the Property to petitioner was by way of an

equitable mortgage and not by sale. After her assertion was sustained by the Courts, respondent cannot































now ignore or disregard the legal effects of such judicial declaration regarding the nature of the

transaction.

xxx......xxx......xxx

4.13 Having delivered possession of the Property to petitioner as part of the constitution of the

equitable mortgage thereon, respondent is not entitled to the return of the Property unless and until

the mortgage loan is discharged by full payment thereof. Petitioner’s right as mortgagee to retain

possession of the Property so long as the mortgage loan remains unpaid is further supported by the rule

that a mortgage may not be extinguished even though then mortgagor-debtor may have made partial

payments on the mortgage loan:

"Art. 2089. A pledge or mortgage is indivisible, even though the debt may be divided among the

successors in interest of the debtor or the creditor.

"Therefore, the debtor’s heir who has paid a part of the debt cannot ask for the proportionate

extinguishment of the pledge or mortgage as long as the debt is not completely satisfied.

"Neither can the creditor’s heir who has received his share of the debt return the pledge or cancel the

mortgage, to the prejudice of the other heirs who have not been paid."

(Emphasis supplied.)


4.14 ......To require petitioner to deliver possession of the Property to respondent prior to the full

payment of the latter’s mortgage loan would be equivalent to the cancellation of the mortgage. Such

effective cancellation would render petitioner’s rights ineffectual and nugatory and would constitute

unwarranted judicial interference.


4.16 The fact of the present case show that respondent delivered possession of the Property to

petitioner upon the execution of the Deed of Absolute Sale and Special Cession of Rights and Interest

dated 10 February 1960. Hence, transfer of possession of the Property to petitioner was an essential

part of whatever agreement the parties entered into, which, in this case, the Supreme Court affirmed to

be an equitable mortgage.


4.19 Petitioner does not have the mistaken notion that the mortgagee must be in actual possession of

the mortgaged property in order to secure the debt. However, in this particular case, the delivery of

possession of the Property was an integral part of the contract between petitioner and respondent.

After all, it was supposed to be a contract of sale. If delivery was not part of the agreement entered into

by the parties in 1960, why did respondent surrender possession thereof to petitioner in the first place?



4.20 Now that the Courts have ruled that the transaction was not a sale but a mortgage, petitioner’s

entitlement to the possession of the Property should be deemed as one of the provisions of the

mortgage, considering that at the time the contract was entered into, possession of the Property was

likewise delivered to petitioner. Thus, until respondent has fully paid her mortgage loan, petitioner

should be allowed to retain possession of the subject property.[16]

Petitioner’s position lacks sufficient legal and factual moorings.

A mortgage is a contract entered into in order to secure the fulfillment of a principal obligation.[17] It is

constituted by recording the document in which it appears with the proper Registry of Property,

although, even if it is not recorded, the mortgage is nevertheless binding between the parties.[18] Thus,

the only right granted by law in favor of the mortgagee is to demand the execution and the recording of

the document in which the mortgage is formalized.[19] As a general rule, the mortgagor retains

possession of the mortgaged property since a mortgage is merely a lien and title to the property does

not pass to the mortgagee.[20] However, even though a mortgagee does not have possession of the

property, there is no impairment of his security since the mortgage directly and immediately subjects

the property upon which it is imposed, whoever the possessor may be, to the fulfillment of the

obligation for whose security it was constituted.[21] If the debtor is unable to pay his debt, the

mortgage creditor may institute an action to foreclose the mortgage, whether judicially or

extrajudicially, whereby the mortgaged property will then be sold at a public auction and the proceeds

therefrom given to the creditor to the extent necessary to discharge the mortgage loan. Apparently,

petitioner’s contention that "*t+o require *him+ … to deliver possession of the Property to respondent

prior to the full payment of the latter’s mortgage loan would be equivalent to the cancellation of the

mortgage" is without basis. Regardless of its possessor, the mortgaged property may still be sold, with

the prescribed formalities, in the event of the debtor’s default in the payment of his loan obligation.

Moreover, this Court cannot find any justification in the records to uphold petitioner’s contention that

respondent delivered possession of the subject property upon the execution of the "Deed of Sale and

Special Cession of Rights and Interests" on February 10, 1960 and that the transfer of possession to

petitioner must therefore be considered an essential part of the agreement between the parties. This

self-serving assertion of petitioner was directly contradicted by respondent in her

pleadings.[22] Furthermore, nowhere in the Court of Appeals’ decisions promulgated on March 31, 1995

(G.R. CV No. 42065) and on October 5, 1998 (G.R. SP No. 48310), or in our own decision promulgated on

July 8, 1996 (G.R. No. 120832) was it ever established that the mortgaged properties were delivered by

respondent to petitioner.

In Alvano v. Batoon,[23] this Court held that "[a] simple mortgage does not give the mortgagee a right to

the possession of the property unless the mortgage should contain some special provision to that

effect." Regrettably for petitioner, he has not presented any evidence, other than his own gratuitous

statements, to prove that the real intention of the parties was to allow him to enjoy possession of the

mortgaged property until full payment of the loan.



































Therefore, we hold that the trial court correctly issued the writ of possession in favor of respondent.

Such writ was but a necessary consequence of this Court’s ruling in G.R. No. 120832 affirming the

validity of the original certificate of title (OCT No. P-13038) in the name of respondent Felicitas de Lara,

while at the same time nullifying the original certificate of title (OCT No. P-11566) in the name of

petitioner Cornelio Isaguirre. Possession is an essential attribute of ownership; thus, it would be

redundant for respondent to go back to court simply to establish her right to possess subject property.

Contrary to petitioner’s claims, the issuance of the writ of possession by the trial court did not constitute

an unwarranted modification of our decision in G.R. No. 120832, but rather, was a necessary

complement thereto.[24] It bears stressing that a judgment is not confined to what appears upon the

face of the decision, but also those necessarily included therein or necessary thereto.[25]

With regard to the improvements made on the mortgaged property, we confirm the Court of Appeals’

characterization of petitioner as a possessor in bad faith. Based on the factual findings of the appellate

court, it is evident that petitioner knew from the very beginning that there was really no sale and that he

held respondent’s property as mere security for the payment of the loan obligation. Therefore,

petitioner may claim reimbursement only for necessary expenses; however, he is not entitled toreimbursement for any useful expenses[26] which he may have incurred.[27]

Finally, as correctly pointed out by the Court of Appeals, this case should be remanded to the Regional

Trial Court of Davao City for a determination of the total amount of the loan, the necessary expenses

incurred by petitioner, and the period within which respondent must pay such amount.[28] However, no

interest is due on the loan since there has been no express stipulation in writing.[29]

WHEREFORE, the assailed Decision of the Court of Appeals dated October 5, 1998 and its Resolution

dated March 5, 1999 are hereby AFFIRMED. Respondent is entitled to delivery of possession of the

subject property. This case is hereby REMANDED to the trial court for determination of the amount of

the loan, the necessary expenses incurred by petitioner and the period within which the respondent

must pay the same.

SO ORDERED.

SPOUSES CRISTINO and BRIGIDA CUSTODIO and SPOUSES LITO and MARIA CRISTINA

SANTOS, petitioners, vs. COURT OF APPEALS, HEIRS OF PACIFICO C. MABASA and REGIONAL TRIAL

COURT OF PASIG, METRO MANILA, BRANCH 181, respondents.

D E C I S I O N

REGALADO, J.:

This petition for review on certiorari assails the decision of respondent Court of Appeals in CA-G.R. CV

No. 29115, promulgated on November 10, 1993, which affirmed with modification the decision of the

trial court, as well as its resolution dated July 8, 1994 denying petitioner’s motion for reconsideration.[1]



















http://sc.judiciary.gov.ph/jurisprudence/1996/feb1996/116100.htm#_edn1












On August 26, 1982, Civil Case No. 47466 for the grant of an easement of right of way was filed by

Pacifico Mabasa against Cristino Custodio, Brigida R. Custodio, Rosalina R. Morato, Lito Santos and Maria

Cristina C. Santos before the Regional Trial Court of Pasig and assigned to Branch 22 thereof .[2]

The generative facts of the case, as synthesized by the trial court and adopted by the Court of Appeals,

are as follows:

Perusing the record, this Court finds that the original plaintiff Pacifico Mabasa died during the pendency

of this case and was substituted by Ofelia Mabasa, his surviving spouse [and children].

The plaintiff owns a parcel of land with a two-door apartment erected thereon situated at Interior P.

Burgos St., Palingon, Tipas, Taguig, Metro Manila. The plaintiff was able to acquire said property

through a contract of sale with spouses Mamerto Rayos and Teodora Quintero as vendors last

September 1981. Said property may be described to be surrounded by other immovables pertaining to

defendants herein. Taking P. Burgos Streetas the point of reference, on the left side, going to plaintiff’s

property, the row of houses will be as follows: That of defendants Cristino and Brigido Custodio, then

that of Lito and Maria Cristina Santos and then that of Ofelia Mabasa. On the right side (is) that of

defendant Rosalina Morato and then a Septic Tank (Exhibit “D”). As an access to P. Burgos Street from

plaintiffs property, there are two possible passageways. The first passageway is approximately one

meter wide and is about 20 meters distan(t) from Mabasa’s residence to P. Burgos Street. Such path is

passing in between the previously mentioned row of houses. The second passageway is about 3 meters

in width and length from plaintiff Mabasa’s residence to P. Burgos Street; it is about 26 meters. In

passing thru said passageway, a less than a meter wide path through the septic tank and with5-6 meters

in length has to be traversed.

When said property was purchased by Mabasa, there were tenants occupying the premises and who

were acknowledged by plaintiff Mabasa as tenants. However, sometime in February, 1982. one of saidtenants vacated the apartment and when plaintiff Mabasa went to see the premises, he saw that there

had been built an adobe fence in the first passageway making it narrower in width. Said adobe fence

was first constructed by defendants Santoses along their property which is also along the first

passageway. Defendant Morato constructed her adobe fence and even extended said fence in such a

way that the entire passageway was enclosed (Exhibit “1-Santoses and Custodios,” Exh. “D” for plaintiff,

Exhs. “1-C”, “1-D” and “I -E”) And it was then that the remaining tenants of said apartment vacated the

area. Defendant Ma. Cristina Santos testified that she constructed said fence because there was an

incident when her daughter was dragged by a bicycle pedalled by a son of one of the tenants in said

apartment along the first passageway. She also mentioned some other inconveniences of having (at) the

front of her house a pathway such as when some of the tenants were drunk and would bang their doors

and windows. Some of their footwear were even lost. x x x[3] (Italics in original text; corrections in

parentheses supplied)

On February 27, 1990, a decision was rendered by the trial court, with this dispositive part:

Accordingly, judgment is hereby rendered as follows:











1) Ordering defendants Custodios and Santoses to give plaintiff permanent access - ingress and egress,

to the public street;

2) Ordering the plaintiff to pay defendants Custodios and Santoses the sum of Eight Thousand Pesos

(P8,000) as indemnity for the permanent use of the passageway.

The parties to shoulder their respective litigation expenses.[4]

Not satisfied therewith, therein plaintiff represented by his heirs, herein private respondents, went to

the Court of Appeals raising the sole issue of whether or not the lower court erred in not awarding

damages in their favor. On November 10, 1993, as earlier stated, the Court of Appeals rendered its

decision affirming the judgment of the trial court with modification, the decretal portion of which

disposes as follows:

WHEREFORE, the appealed decision of the lower court is hereby AFFIRMED WITH MODIFICATION only

insofar as the herein grant of damages to plaintiffs-appellants. The Court hereby orders defendants-

appellees to pay plaintiffs-appellants the sum of Sixty Five Thousand (P65,000) Pesos as Actual Damages,Thirty Thousand (P30,000) Pesos as Moral Damages, and Ten Thousand (P10,000) Pesos as Exemplary

Damages. The rest of the appealed decision is affirmed to all respects.[5]

On July 8, 1994, the Court of Appeals denied petitioner’s motion for reconsideration.[6] Petitioners then

took the present recourse to us, raising two issues, namely, whether or not the grant of right of way to

herein private respondents is proper, and whether or not the award of damages is in order.

With respect to the first issue, herein petitioners are already barred from raising the same. Petitioners

did not appeal from the decision of the court a quo granting private respondents the right of way, hence

they are presumed to be satisfied with the adjudication therein. With the finality of the judgment of the

trial court as to petitioners, the issue of propriety of the grant of right of way has already been laid to

rest.

For failure to appeal the decision of the trial court to the Court of Appeals, petitioners cannot obtain any

affirmative relief other than those granted in the decision of the trial court. That decision of the court

below has become final as against them and can no longer be reviewed, much less reversed, by this

Court. The rule in this jurisdiction is that whenever an appeal is taken in a civil case, an appellee who

has not himself appealed may not obtain from the appellate court any affirmative relief other than what

was granted in the decision of the lower court. The appellee can only advance any argument that he

may deem necessary to defeat the appellant’s claim or to uphold the decision that is being disputed,

and he can assign errors in his brief if such is required to strengthen the views expressed by the court aquo. These assigned errors, in turn, may be considered by the appellate court solely to maintain the

appealed decision on other grounds, but not for the purpose of reversing or modifying the judgment in

the appellee’s favor and giving him other affirmative reliefs.[7]

However, with respect to the second issue, we agree with petitioners that the Court of Appeals erred in

awarding damages in favor of private respondents. The award of damages has no substantial legal



















basis. A reading of the decision of the Court of Appeals will show that the award of damages was based

solely on the fact that the original plaintiff, Pacifico Mabasa, incurred losses in the form of unrealized

rentals when the tenants vacated the leased premises by reason of the closure of the passageway.

However, the mere fact that the plaintiff suffered losses does not give rise to a right to recover

damages. To warrant the recovery of damages, there must be both a right of action for a legal wronginflicted by the defendant, and damage resulting to the plaintiff therefrom. Wrong without damage, or

damage without wrong, does not constitute a cause of action, since damages are merely part of the

remedy allowed for the injury caused by a breach or wrong.[8]

There is a material distinction between damages and injury. Injury is the illegal invasion of a legal right;

damage is the loss, hurt, or harm which results from the injury; and damages are the recompense or

compensation awarded for the damage suffered. Thus, there can be damage without injury in those

instances in which the loss or harm was not the result of a violation of a legal duty. These situations are

often called damnum absque injuria.[9] in order that a plaintiff may maintain an action for the injuries of

which he complains, he must establish that such injuries resulted from a breach of duty which the

defendant owed to the plaintiff - a concurrence of injury to the plaintiff and legal responsibility by the

person causing it.[10] The underlying basis for the award of tort damages is the premise that an

individual was injured in contemplation of law. Thus, there must first be the breach of some duty and

the imposition of liability for that breach before damages may be awarded; it is not sufficient to state

that there should be tort liability merely because the plaintiff suffered some pain and suffering)[11]

Many accidents occur and many injuries are inflicted by acts or omissions which cause damage or loss to

another but which violate no legal duty to such other person, and consequently create no cause of

action in his favor. In such cases, the consequences must be borne by the injured person alone. The law

affords no remedy for damages resulting from an act which does not amount to a legal injury or

wrong. [12]

In other words, in order that the law will give redress for an act causing damage, that act must be not

only hurtful, but wrongful. There must be damnum et injuria.[13] If, as may happen in many cases, a

person sustains actual damage, that is, harm or loss to his person or property, without sustaining any

legal injury, that is, an act or omission which the law does not deem an injury, the damage is regarded

as damnum absque injuria.[14]

In the case at bar, although there was damage, there was no legal injury. Contrary to the claim of private

respondents, petitioners could not be said to have violated the principle of abuse of right. In order that

the principle of abuse of right provided in Article 21 of the Civil Code can be applied, it is essential thatthe following requisites concur: (1) The defendant should have acted in a manner that is contrary to

morals, good customs or public policy; (2) The acts should be willful; and (3) There was damage or injury

to the plaintiff .[15]

The act of petitioners in constructing a fence within their lot is a valid exercise of their right as owners,

hence not contrary to morals, good customs or public policy. The law recognizes in the owner the right

to enjoy and dispose of a thing, without other limitations than those established by law.[16] It is within







































the right of petitioners, as owners, to enclose and fence their property. Article 430 of the Civil Code

provides that “(e)very owner may enclose or fence his land or tenements by means of walls, ditches, live

or dead hedges, or by any other means without detriment to servitudes constituted thereon.”

At the time of the construction of the fence, the lot was not subject to any servitudes. There was no

easement of way existing in favor of private respondents, either by law or by contract. The fact thatprivate respondents had no existing right over the said passageway is confirmed by the very decision of

the trial court granting a compulsory right of way in their favor after payment of just compensation. It

was only that decision which gave private respondents the right to use the said passageway after

payment of the compensation and imposed a corresponding duty on petitioners not to interfere in the

exercise of said right.

Hence, prior to said decision, petitioners had an absolute right over their property and their act of

fencing and enclosing the same was an act which they may lawfully perform in the employment and

exercise of said right. To repeat, whatever injury or damage may have been sustained by private

respondents by reason of the rightful use of the said land by petitioners isdamnum absque injuria.[17]

A person has a right to the natural use and enjoyment of his own property, according to his pleasure, for

all the purposes to which such property is usually applied. As a general rule, therefore, there is no cause

of action for acts done by one person upon his own property in a lawful and proper manner, although

such acts incidentally cause damage or an unavoidable loss to another, as such damage or loss

is damnum absque injuria.[18] When the owner of property makes use thereof in the general and

ordinary manner in which the property is used, such as fencing or enclosing the same as in this case,

nobody can complain of having been injured, because the inconvenience arising from said use can be

considered as a mere consequence of community life.[19]

The proper exercise of a lawful right cannot constitute a legal wrong for which an action willlie,[20] although the act may result in damage to another, for no legal right has been invaded[21] One

may use any lawful means to accomplish a lawful purpose and though the means adopted may cause

damage to another, no cause of action arises in the latter’s favor. Any injury or damage occasioned

thereby is damnum absque injuria. The courts can give no redress for hardship to an individual resulting

from action reasonably calculated to achieve a lawful end by lawful means.[22]

WHEREFORE, under the compulsion of the foregoing premises, the appealed decision of respondent

Court of Appeals is hereby REVERSED and SET ASIDE and the judgment of the trial court is

correspondingly REINSTATED.

SO ORDERED.

PACENCIO ABEJARON, as represented by his Attorney-in-Fact, ALEJANDRO ABEJARON, petitioner,

vs. FELIX NABASA and the COURT OF APPEALS,respondents.

D E C I S I O N*

PUNO, J.:


















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With the burgeoning population comes a heightened interest in the limited land resource, especially so

if, as in the case at bar, one's home of many years stands on the land in dispute. It comes as no surprise

therefore that while this case involves a small parcel of land, a 118-square meter portion of Lot 1, Block

5, Psu-154953 in Silway, General Santos City, the parties have tenaciously litigated over it for more than

twenty years.

Petitioner Abejaron filed this petition for review on certiorari to annul the respondent court's Decision

dated April 26, 1988 and Resolution dated July 12, 1988 reversing the trial court's decision and declaring

respondent Nabasa the owner of the subject lot.

The following facts spurred the present controversy:

Petitioner Abejaron avers that he is the actual and lawful possessor and claimant of a 118-square meter

portion of a 175-square meter residential lot in Silway, General Santos City described as "Block 5, Lot 1,

Psu-154953, bounded on the North by Road, on the South by Lot 2 of the same Psu, on the East by Felix

Nabasa, and on the West by Road."[1] In 1945, petitioner Abejaron and his family started occupying the

118-square meter land. At that time, the land had not yet been surveyed. They fenced the area and

built thereon a family home with nipa roofing and a small store. In 1949, petitioner improved their

abode to become a two-storey house measuring 16 x 18 feet or 87.78 square meters made of round

wood and nipa roofing.[2] This house, which stands to this day, occupies a portion of Lot 1, Block 5, Psu-

154953 and a portion of the adjoining Lot 2 of the same Psu. Lot 2 belongs to petitioner’s daughter,

Conchita Abejaron-Abellon. In 1950, the small store was destroyed and in its stead, petitioner Abejaron

built another store which stands up to the present. In 1951, he planted five coconut trees on the

property in controversy. Petitioner's wife, Matilde Abejaron, harvested coconuts from these

trees.[3] Petitioner Abejaron also planted banana and avocado trees. He also put up a pitcher

pump.[4] All this time that the Abejarons introduced these improvements on the land in controversy,

respondent Nabasa did not oppose or complain about the improvements.

Knowing that the disputed land was public in character, petitioner declared only his house, and not the

disputed land, for taxation purposes in 1950, 1966, 1976, and 1978.[5] The last two declarations state

that petitioner Abejaron’s house stands on Lots 1 and 2, Block 5, Psu 154953.[6] Abejaron paid taxes on

the house in 1955, 1966, and 1981.[7]

Petitioner stated that beginning 1955, respondent Nabasa resided on the remaining 57-square meter

portion of Lot 1, Block 5, Psu-154953.[8] Nabasa built his house about four (4) meters away from

petitioner Abejaron's house. Beatriz Gusila, a neighbor of the Abejarons and the Nabasas confirmed

that when she arrived in Silway in 1949, Nabasa was not yet residing there while Abejaron was alreadyliving in their house which stands to this day.

Before 1974, employees of the Bureau of Lands surveyed the area in controversy. Abejaron merely

watched them do the survey[9] and did not thereafter apply for title of the land on the belief that he

could not secure title over it as it was government property.[10] Without his (Abejaron) knowledge and

consent, however, Nabasa "clandestinely, willfully, fraudulently, and unlawfully applied for and caused

the titling in his name" of the entire Lot 1, Block 5, Psu-154953, including petitioner Abejaron's 118-

http://sc.judiciary.gov.ph/jurisprudence/2001/jun2001/84831.htm#_edn1










































square meter portion.[11] Petitioner imputes bad faith and fraud on the part of Nabasa because in

applying for and causing the titling in his name of Lot 1, Block 5, Psu-154953, Nabasa represented

himself to be the actual and lawful possessor of the entire Lot 1, Block 5, including petitioner Abejaron's

118-square meter portion despite knowledge of Abejaron's actual occupation and possession of said

portion.[12]

On September 24, 1974, Nabasa was issued Original Certificate of Title No. P-4140 pursuant to Free

Patent No. (XI-4) 2877 covering Lot 1, Block 5, Psu-154953. As the title included petitioner Abejaron’s

118-square meter portion of the lot, his son, Alejandro Abejaron, representing Matilde Abejaron

(petitioner Abejaron's wife), filed a protest with the Bureau of Lands, Koronadal, South Cotabato against

Nabasa's title and application. The protest was dismissed on November 22, 1979 for failure of Matilde

and Alejandro to attend the hearings.[13] Alejandro claims, however, that they did not receive notices

of the hearings. Alejandro filed a motion for reconsideration dated January 10, 1980. Alejandro also

filed a notice of adverse claim on January 14, 1980. Subsequently, he requested the Bureau of Lands to

treat the motion as an appeal considering that it was filed within the 60-day reglementary period. The

motion for reconsideration was endorsed and forwarded by the District Land Office XI-3 of the Bureau ofLands in Koronadal, Cotabato to the Director of Lands in Manila on November 24, 1981.[14] But because

the appeal had not been resolved for a prolonged period for unknown reasons, petitioner Abejaron filed

on March 12, 1982 an action for reconveyance with damages against respondent Nabasa before Branch

22, Regional Trial Court of General Santos City.[15] On May 10, 1982, petitioner filed a notice of lis

pendens.[16]

Abner Lagsub, geodetic engineer, testified for the petitioner. Lagsub stated that on March 30, 1980,

Alejandro Abejaron hired him to relocate Lot 1, Block 5, Psu-154953, the land in controversy. He

surveyed the lot measuring 175 square meters. Fifty-seven (57) square meters of Lot 1 and a portion of

the adjoining Lot 3 were occupied by Nabasa's house. This portion was fenced partly by hollow blocksand partly by bamboo. On the remaining 118 square meters stood a portion of petitioner Abejaron’s

house and two coconut trees near it, and his store. Abejaron's 118-square meter portion was separated

from Nabasa's 57-square meter part by Abejaron's fence made of hollow blocks. Both Nabasa’s and

Abejaron’s houses appeared more than twenty years old while the coconut trees appeared about 25

years old.

Back in 1971, Lagsub conducted a subdivision survey on Psu-154953. He was then hired by the Silway

Neighborhood Association to conduct the survey for purposes of allocating lots to the members of the

association, among whom were respondent Nabasa and petitioner Abejaron. When the 1971 survey

was conducted, both the Abejarons and Nabasa were already occupying their respective 118 and 57

square meter portions of Lot 1, Block 5. Nabasa and Matilde Abejaron, representative of petitioner,

were present during the survey.[17]

Respondent Nabasa had a different story to tell. He contends that he had been residing on a 12 x 15

meter or 180-square meter public land in Silway, General Santos City since 1945. He admits that

petitioner Abejaron was already residing in Silway when he arrived there. Nabasa constructed a house

which stands to this day and planted five coconut trees on this 180-square meter land, but only two of































the trees survived. Nabasa never harvested coconuts from these trees as petitioner Abejaron claims to

own them and harvests the coconuts. In many parts of respondent Nabasa’s testimony, however, he

declared that he started occupying the 180-square meter area in 1976.[18]

Nabasa avers that previously, he and petitioner Abejaron were in possession of portions of Lot 2, Psu-

154953. This lot was subsequently surveyed and divided into smaller lots with the area of petitionerAbejaron designated as Lot 2, Block 5, Psu-154953 measuring one hundred eighty (180) square meters,

while his was designated as Lot 1, Block 5, Psu-154953 with an area of one hundred seventy five (175)

square meters.

Instead of applying for free patent over his Lot 2, petitioner Abejaron gave this lot to his daughter

Conchita Abejaron-Abellon and allowed her to file the application with the District Land Office XI-4,

Bureau of Lands, Koronadal, South Cotabato. Conchita secured Free Patent No. (XI-4)-3293 over Lot

2. Pursuant to this, she was issued Original Certificate of Title No. P-4420. On April 27, 1981, Conchita's

title was transcribed in the Registration Book of General Santos City.

Respondent Nabasa, on the other hand, filed an application for Free Patent over Lot 1, Block 5, Psu-

154953 with the District Land Office No. XI-4, Bureau of Lands, Koronadal, South Cotabato. While the

application was pending, petitioner Abejaron forcibly encroached upon the northern and southwestern

portion of Lot 1, Block 5, Psu-159543. Abejaron fenced the disputed 118-square meter portion of Lot 1

and despite Nabasa's opposition, constructed a store near the road. Petitioner Abejaron then

transferred his old house constructed on Lot 2, Block 5, Psu-154953 to a portion of the disputed 118-

square meter area. Petitioner's daughter, Conchita, patentee and title holder of Lot 2, constructed her

own house in Lot 2.

Free Patent No. (XI-4)-2877, covering Lot 1, Block 5, was issued to respondent Nabasa on September 24,

1974. But before the patent could be transcribed on the Registration Book of the Registrar of Deeds ofGeneral Santos City, the District Land Officer of District Land Office No. XI-4 recalled it for investigation

of an administrative protest filed by the petitioner.[19] The protest was given due course, but petitioner

Abejaron or his representative failed to appear in the hearings despite notice.

On November 22, 1979, the administrative protest was dismissed by the District Land Officer for failure

of petitioner Abejaron or his representative to appear in the hearings despite notice.[20] Respondent

Nabasa's Free Patent No. (XI-4)-2877 was then re-transmitted by the District Land Officer of District Land

Office XI-4 to the Register of Deeds, General Santos City, and the same was transcribed in the

Registration Book of the Registry of Property of General Santos City on December 13, 1979. Original

Certificate of Title No. P-4140, covering Lot 1, Block 2, Psu-154953, was issued to respondentNabasa.[21]

On March 12, 1982, petitioner Abejaron filed against respondent Nabasa an action for reconveyance

with damages seeking reconveyance of his 118-square meter portion of Lot 1, Block 5, Psu-154953.

During the trial, respondent Nabasa presented Abundio Guiral, his neighbor who had been living since

1945 in Lot 3, Block 5, Psu-154953, adjoining Nabasa's Lot 1. He testified that when he arrived in Silway,



















petitioner Abejaron was already living there. Four months after, Nabasa started residing in the

area. Nabasa constructed a house, planted coconut trees, and fenced his 12 x 15 meter

area. Abejaron's house in 1945 is still the same house he lives in at present, but in 1977, it was jacked

up and transferred from Lot 2 to Lot 1, Block 5. Nabasa tried to prevent the transfer to no avail. The

house was then extended towards Lot 2.[22]

On rebuttal, petitioner Abejaron presented two neighbors. One of them, Alejandra Doria, started living

in Silway in 1947. She testified that when she arrived in the neighborhood, Abejaron's fence as it now

stands between the 57-square meter portion occupied by Nabasa's house and the 118-square meter

area claimed by petitioner Abejaron was already there.[23] The other neighbor, Pacencia Artigo, also

started living in Silway in 1947. She declared that the house of the Abejarons stands now where it stood

in 1947. She also testified that the Abejarons previously had a store smaller than their present

store.[24]

On September 27, 1985, after trial on the merits, the trial court ruled in favor of petitioner Abejaron, viz:

"WHEREFORE, IN VIEW OF ALL THE FOREGOING, this court hereby renders judgment as follows:

1. Declaring the possession and occupancy of Pacencio Abejaron over 118 square meters of Lot No. 1,

Block 5, Psu-154953 in good faith and thereby declaring the inclusion of 118 square meters of said lot in

OCT No. P-4140 erroneous and a mistake, and for which, defendant Felix Nabasa is hereby ordered to

reconvey and execute a registerable document in favor of plaintiff Pacencio Abejaron, Filipino, married

and a resident of Silway, General Santos City, his heirs, successors and assigns over an area of one

hundred eighteen (118) square meters of Lot No. 1, Block 5, Psu-154953, situated at Silway, General

Santos City, on the Western portion of said lot as shown in the sketch plan, Exhibit "R", and the

remaining portion of 57 square meters of said lot to be retained by defendant Felix Nabasa;

2) Should Felix Nabasa fails (sic) to do so, upon the finality of this judgment, the Clerk of Court shall

executed (sic) it in the name of Felix Nabasa, widower, and will have the same effect as if executed by

the latter and the Register of Deeds, General Santos City, is hereby directed to issue New Transfer

Certificate of Title to Alejandro Abejaron over 118 square meters of Lot No. 1, Block 5, Psu-154953, and

New Transfer Certificate of Title over 57 square meters of same Lot No. 1, Block 5, Psu-154953, in favor

of Felix Nabasa, and ultimately to have OCT No. P-4140 of Felix Nabasa cancelled accordingly."

Respondent Nabasa's motion for reconsideration having been denied, he appealed to the Court of

Appeals. On April 26, 1988, the Court of Appeals rendered a decision in favor of respondent Nabasa, viz:

". . . the only basis for reconveyance is actual fraud. In this case, Abejaron failed to substantiate theexistence of actual fraud. . . There was no proof of irregularity in the issuance of title nor in the

proceedings incident thereto nor was there a claim that fraud intervened in the issuance of the title,

thus, the title has become indefeasible (Frias v. Esquival, 67 SCRA 487). Abejaron was not able to

establish his allegation that Nabasa misrepresented his status of possession in his application for the

title. . . In fact, in Abejaron's answer to Nabasa's counterclaim, he said that Nabasa has been occupying

the area since 1950.















Contrary to the finding of the court a quo, the Bureau of Lands conducted an ocular inspection before

the title was issued. This was confirmed by Abejaron himself (tsn, January 19, 1984).

xxx

WHEREFORE, premises considered, the decision appealed from is hereby REVERSED and SET ASIDE and a

new one entered declaring Felix Nabasa as the owner of the lot covered by O.C.T. No. P-4140. Costs

against plaintif-appellee.

SO ORDERED."

Petitioner Abejaron filed a motion for reconsideration of the Court of Appeals decision. On July 22,

1988, the Court of Appeals rendered a resolution denying the motion for reconsideration for lack of

merit. Hence, this petition for review on certiorari with the following assignment of errors:

"I. THE HONORABLE COURT OF APPEALS ERRED IN NOT FINDING THAT ACTUAL FRAUD WAS

COMMITTED BY THE PRIVATE RESPONDENT AND PROVEN BY THE PETITIONER AND SUSTAINED BY THE

TRIAL COURT WHEN PRIVATE RESPONDENT PROCURED THE TITLE IN HIS NAME OF THE AREA OF THE

LOT IN QUESTION, LOT 1, BLOCK 5, LOCATED AT SILWAY, DADIANGAS, GENERAL SANTOS CITY.

II. THE HONORABLE COURT OF APPEALS ERRED IN CONCLUDING THAT THE LOT WHICH BELONGS TO

THE PETITIONER IS LOT 2 OF THE SAME BLOCK AND PSU, AND THAT THE PETITIONER FORCIBLY ENTERED

INTO LOT 1 OF THE SAME BLOCK AND PSU, AND FORCIBLY TRANSFERRED HIS OLD HOUSE FROM LOT 2

TO LOT 1 IS BASED ONLY ON THE SELF-SERVING ALLEGATIONS OF THE PRIVATE RESPONDENT AND NOT

SUPPORTED BY ANY COMPETENT AND CONVINCING EVIDENCE.

III. THE HONORABLE COURT OF APPEALS ERRED IN DISREGARDING THE FACT THAT PETITIONER HAS A

CLEAR RIGHT OVER THE PROPERTY IN QUESTION BECAUSE HE HAS BEEN IN ACTUAL AND LAWFULPOSSESSION FOR SO MANY YEARS AND A CLAIMANT OF THE PROPERTY IN QUESTION."

We affirm the decision of the Court of Appeals.

An action for reconveyance of a property is the sole remedy of a landowner whose property has been

wrongfully or erroneously registered in another's name after one year from the date of the decree so

long as the property has not passed to an innocent purchaser for value.[25] The action does not seek to

reopen the registration proceeding and set aside the decree of registration but only purports to show

that the person who secured the registration of the property in controversy is not the real owner

thereof .[26] Fraud is a ground for reconveyance. For an action for reconveyance based on fraud to

prosper, it is essential for the party seeking reconveyance to prove by clear and convincing evidence his

title to the property and the fact of fraud.[27]

Petitioner Abejaron does not claim to own Lot 1, Block 5, Psu-154953. He in fact admits that he believed

the land in dispute was public in character, thus he did not declare it for taxation purposes despite

possession of it for a long time. Neither did he apply for title over it on the mistaken belief that he could

not apply for title of a public land. In his Complaint, he stated that respondent Nabasa's fraudulent















procurement of Free Patent No. (XI-4)-2877 and OCT No. P-4140 over the disputed land deprived him

not of ownership, but of his "right to file the necessary application thereon with the authorities

concerned"[28] as long-time possessor of the land.

Nonetheless, petitioner contends that an action for reconveyance is proper, viz:

". . . for an action of reconveyance of a parcel of land to prosper, it is not necessary that the proponent

be the absolute owner thereof. It is enough that the proponent has an equitable right thereon. In the

case at bar, the plaintiff had been in lawful, open, continuous and notorious possession, occupation and

control in the concept of an owner of a greater portion of the subject lot since 1945 and have (sic)

thereby acquired an equitable right thereon protected by law. Possession of public lands once

occupation of the same is proven, as the herein plaintiff did, under claim of ownership constitutes a

grant from the state (Republic vs. Vera, 120 SCRA 210). A portion of the public land ceased to be public

as soon as its claimant had performed all the conditions essential to a grant (Republic vs. Villanueva, 114

SCRA 875)."[29]

Petitioner's contention, buttressed by the Vera case and Chief Justice Teehankee's dissent in

the Villanueva case, is similar to the position taken by the plaintiff in Mesina v. Vda. de Sonza, et

al.[30] In that case, plaintiff filed in the Court of First Instance of Nueva Ecija an action for cancellation of

the original certificate of title procured by the defendant by virtue of a homestead patent. The title

covered a public land which she claimed to own through public, open, and peaceful possession for more

than thirty years. The law applicable in that case, which petitioner Abejaron apparently relies on in the

case at bar, is Sec. 48(b) of Commonwealth Act 141 or the Public Land Act, as amended by Republic Act

No. 1942, which took effect on June 22, 1957, viz:

"Sec. 48. The following-described citizens of the Philippines, occupying lands of the public domain or

claiming to own any such lands or an interest therein, but whose titles have not been perfected orcompleted, may apply to the Court of First Instance (now Regional Trial Courts) of the province where

the land is located for confirmation of their claims and the issuance of a certificate of title therefor,

under the Land Registration Act (now Property Registration Decree), to wit:

xxx

(b) Those who by themselves or through their predecessors in interest have been in open, continuous,

exclusive, and notorious possession and occupation of agricultural lands of the public domain, under a

bona fide claim of acquisition of ownership, for at least thirty years immediately preceding the filing of

the application for confirmation of title except when prevented by war or force majeure. These shall be

conclusively presumed to have performed all the conditions essential to a Government grant and shall

be entitled to a certificate of title under the provisions of this Chapter." (emphasis supplied)

Citing Susi v. Razon,[31] the Court interpreted this law, viz:

". . . where all the necessary requirements for a grant by the Government are complied with through

actual physical possession openly, continuously, and publicly with a right to a certificate of title to said



















land under the provisions of Chapter VIII of Act No. 2874, amending Act No. 926 (carried over as Chapter

VIII of Commonwealth Act No. 141), the possessor is deemed to have already acquired by operation of

law not only a right to a grant, but a grant of the Government, for it is not necessary that a certificate of

title be issued in order that said grant may be sanctioned by the courts -an application therefor being

sufficient under the provisions of Section 47 of Act No. 2874 (reproduced as Section 50, Commonwealth

Act No. 141). If by a legal fiction, Valentin Susi had acquired the land in question by grant of the State, it

had already ceased to be of the public domain and had become private property, at least by

presumption, of Valentin Susi, beyond the control of the Director of Lands. (Italics supplied)"

The Mesina and Susi cases were cited in Herico v. Dar,[32] another action for cancellation of title issued

pursuant to a free patent. Again, the Court ruled that under Section 48(b) of the Public Land Act, as

amended by Rep. Act No. 1942, with the plaintiff's proof of occupation and cultivation for more than 30

years since 1914, by himself and by his predecessor-in-interest, title over the land had vested in him as

to segregate the land from the mass of public land. Thenceforth, the land was no longer disposable

under the Public Land Act by free patent.[33] The Court held, viz:

"As interpreted in several cases (Susi v. Razon, et al., 48 Phil. 424; Mesina v. Pineda Vda. de Sonza, G.R.

No. L-14722, May 25, 1960) when the conditions as specified in the foregoing provision are complied

with, the possessor is deemed to have acquired, by operation of law, a right to a grant, a government

grant, without the necessity of a certificate of title being issued. The land, therefore, ceases to be of

public domain, and beyond the authority of the Director of Lands to dispose of. The application for

confirmation is a mere formality, the lack of which does not affect the legal sufficiency of the title as

would be evidenced by the patent and the Torrens title to be issued upon the strength of said

patent."[34]

In citing Republic v. Villanueva, et al.,[35] petitioner Abejaron relied on the dissenting opinion of Chief

Justice Teehankee. However, the en banc majority opinion in that case and in Manila Electric Company

v. Bartolome,[36] departed from the doctrines enunciated in the Susi, Mesina, and Herico

cases. Citing Uy Un v. Perez,[37] the Court ruled that "the right of an occupant of public agricultural land

to obtain a confirmation of his title under Sec. 48(b) of Com. Act. No. 141, as amended by Rep. Act No.

1942, is 'derecho dominical incoativo' and that before the issuance of the certificate of title the

occupant is not in the juridical sense the true owner of the land since it still pertains to the State."[38]

The Court pointed out that the Villanueva and Meralco cases are different from the oft-cited Susi case as

the latter involved a parcel of land possessed by a Filipino citizen since time immemorial, while the land

in dispute in the Villanueva and Meralco cases were sought to be titled by virtue of Sec. 48(b) of the

Public Land Act, as amended. In explaining the nature of land possessed since time immemorial, the

Court quoted Oh Cho v. Director of Lands,[39] viz:

"All lands that were not acquired from the Government, either by purchase or by grant, belong to the

public domain. An exception to the rule would be any land that should have been in the possession of

an occupant and of his predecessors-in-interest since time immemorial, for such possession would



































justify the presumption that the land had never been part of the public domain or that it had been a

private property even before the Spanish conquest."

In 1986, however, in Director of Lands v. Intermediate Appellate Court, et al.,[40] this Court en

banc recognized the strong dissent registered by Chief Justice Teehankee in the Villanueva case and

abandoned the Villanueva and Meralco ruling to revert to the Susi doctrine. Reiteratingthe Susi and Herico cases, the Court ruled:

"Nothing can more clearly demonstrate the logical inevitability of considering possession of public land

which is of character and duration prescribed by statute as the equivalent of express grant from the

State than the dictum of the statute itself [Sec. 48(b)] that the possessor(s) 'x x x shall be conclusively

presumed to have performed all the conditions essential to a Government grant and shall be entitled to

a certificate of title x x x.' No proof being admissible to overcome a conclusive presumption,

confirmation proceedings would, in truth be little more than a formality, at the most limited to

ascertaining whether the possession claimed is of the required character and length of time; and

registration thereunder would not confer title, but simply recognize a title already vested. The

proceedings would not originally convert the land from public to private land, but only confirm such a

conversion already effected by operation of law from the moment the required period of possession

became complete."[41] (Emphasis supplied)

This is the prevailing rule as reiterated in the more recent case of Rural Bank of Compostela v. Court of

Appeals, a ponencia of now Chief Justice Davide, Jr.,[42] viz:

"The rule under the latter (Section 48[b] of the Public Land Act, as amended by R.A. No. 1942), is that

when the conditions specified therein are complied with, the possessor is deemed to have acquired, by

operation of law, a right to a government grant, without necessity of a certificate of title being issued,

and the land ceases to be part of the public domain and beyond the authority of the Director ofLands."[43]

The question brought to the fore, therefore, is whether or not petitioner Abejaron has satisfied the

conditions specified in Sec. 48(b) of the Public Land Act, as amended by R.A. No. 1942. Sec. 48(b) has

been further amended by P.D. No. 1073 which took effect on January 25, 1977. Sec. 4 of the P.D. reads

as follows:

"Sec. 4. The provision of Section 48(b) and Section 48(c), Chapter VIII, of the Public Land Act, are hereby

amended in the sense that these provisions shall apply only to alienable and disposable lands of the

public domain which have been in open, continuous, exclusive and notorious possession and occupation

by the applicant himself or thru his predecessor-in-interest, under a bona fide claim of acquisition of

ownership, since June 12, 1945.”

Sec. 48(b) of the Public Land Act, as further amended by P.D. No. 1073, now reads:

"(b) Those who by themselves or through their predecessors-in-interest have been in open, continuous,

exclusive and notorious possession and occupation of agricultural lands of the public domain, under



















a bona fide claim of acquisition or ownership, since June 12, 1945, or earlier, immediately preceding the

filing of the application for confirmation of title, except when prevented by wars or force

majeure. Those shall be conclusively presumed to have performed all the conditions essential to a

Government grant and shall be entitled to a certificate of title under the provisions of this chapter."

(Italics ours)[44]

However, as petitioner Abejaron's 30-year period of possession and occupation required by the Public

Land Act, as amended by R.A. 1942 ran from 1945 to 1975, prior to the effectivity of P.D. No. 1073 in

1977, the requirement of said P.D. that occupation and possession should have started on June 12, 1945

or earlier, does not apply to him. As the Susi doctrine holds that the grant of title by virtue of Sec. 48(b)

takes place by operation of law, then upon Abejaron's satisfaction of the requirements of this law, he

would have already gained title over the disputed land in 1975. This follows the doctrine laid down

in Director of Lands v. Intermediate Appellate Court, et al.,[45] that the law cannot impair vested rights

such as a land grant. More clearly stated, "Filipino citizens who by themselves or their predecessors-in-

interest have been, prior to the effectivity of P.D. 1073 on January 25, 1977, in open, continuous,

exclusive and notorious possession and occupation of agricultural lands of the public domain, under abona fide claim of acquisition of ownership, for at least 30 years, or at least since January 24, 1947" may

apply for judicial confirmation of their imperfect or incomplete title under Sec. 48(b) of the Public Land

Act.[46]

Having laid down the law applicable to the case at bar, i.e., Sec. 48(b) of the Public Land Act, as

amended by R.A. 1942, we now determine whether or not petitioner has acquired title over the

disputed land. In doing so, it is necessary for this Court to wade through the evidence on record to

ascertain whether petitioner has been in open, continuous, exclusive and notorious possession and

occupation of the 118-square meter disputed land for 30 years at least since January 24, 1947. It is

axiomatic that findings of fact by the trial court and the Court of Appeals are final and conclusive on theparties and upon this Court, which will not be reviewed or disturbed on appeal unless these findings are

not supported by evidence or unless strong and cogent reasons dictate otherwise.[47] One instance

when findings of fact of the appellate court may be reviewed by this Court is when, as in the case at bar,

the factual findings of the Court of Appeals and the trial court are contradictory.[48]

Petitioner claims that he started occupying the disputed land in 1945. At that time, he built

a nipa house, a small store, and a fence made of wood to delineate his area. This nipa house was

improved in 1949 into a two-storey house. The small store was also made bigger in 1950. The wooden

fence was also changed to a fence made of hollow blocks. The two-storey house, bigger store, and

hollow-block fence all stand to this day. In 1951, petitioner planted coconut trees near his house. While

the petitioner has shown continued existence of these improvements on the disputed land, they were

introduced later than January 24, 1947. He has failed to establish the portion of the disputed land that

his original nipa house, small store and wooden fence actually occupied as of January 24, 1947. In the

absence of this proof, we cannot determine the land he actually possessed and occupied for thirty years

which he may acquire under Sec. 48(b) of the Public Land Act. Worthy of notice is the fact that the

disputed land was surveyed, subdivided into and identified by lots only in the 1970's. Therefore, prior to























the survey, it would be difficult to determine the metes and bounds of the land petitioner claims to have

occupied since 1947 in the absence of specific and incontrovertible proof.

The neighbors presented by the petitioner, namely Alejandra Doria, Pacencia Artigo, and Beatriz Gusila,

could not also further his cause as both Doria and Artigo stated that they started residing in Silway in

1947, without specifying whether it was on or prior to January 24, 1947, while Gusila arrived in theneighborhood in 1949. While Doria testified that there was a fence between Abejaron's and Nabasa's

houses in 1947, she did not state that Abejaron's 118-square meter area was enclosed by a fence which

stands to this day. This is confirmed by Geodetic Engineer Lagsub's 1984 survey plan which shows that a

fence stands only on one side of the 118-square meter area, the side adjacent to Nabasa's 57-square

meter portion. Again, this poses the problem of determining the area actually occupied and possessed

by Abejaron at least since January 24, 1947.

Finally, as admitted by the petitioner, he has never declared the disputed land for taxation

purposes. While tax receipts and tax declarations are not incontrovertible evidence of ownership, they

become strong evidence of ownership acquired by prescription when accompanied by proof of actual

possession of the property or supported by other effective proof .[49] Even the tax declarations and

receipts covering his house do not bolster his case as the earliest of these was dated 1950.

Petitioner's evidence does not constitute the "well-nigh incontrovertible" evidence necessary to acquire

title through possession and occupation of the disputed land at least since January 24, 1947 as required

by Sec. 48(b) of the Public Land Act, as amended by R.A. 1942. The basic presumption is that lands of

whatever classification belong to the State and evidence of a land grant must be "well-nigh

incontrovertible."[50] As petitioner Abejaron has not adduced any evidence of title to the land in

controversy, whether by judicial confirmation of title, or homestead, sale, or free patent, he cannot

maintain an action for reconveyance.

In De La Peña v. Court of Appeals and Herodito Tan,[51] the petitioner filed an action for reconveyance,

claiming preferential right to acquire ownership over a 3/4 hectare of land and imputing fraud and

misrepresentation to respondent in securing a free patent and original certificate of title over the land in

controversy. The action for reconveyance was dismissed by the trial court and the Court of

Appeals. This Court affirmed the decision of the Court of Appeals, viz:

"It is well-settled that reconveyance is a remedy granted only to the owner of the property alleged to

be erroneously titled in another's name. (Tomas v. Court of Appeals, G.R. No. 79328, 21 May 1990, 185

SCRA 627, 633; Esconde v. Barlongay, G.R. No. 67583, 31 July 1987, 152 SCRA 603, 611; Nebrada v. Heirs

of Alivio, et al., 104 Phil. 126 [1958]; Director of Lands v. Register of Deeds of Rizal, 92 Phil. 826 [1953];Azurin v. Quitoriano, et al., 81 Phil. 261 [1948]). In the case at bench, petitioner does not claim to be the

owner of the disputed portion. Admittedly, what he has is only a "preferential right" to acquire

ownership thereof by virtue of his actual possession since January 1947. . . Title to alienable public lands

can be established through open, continuous, and exclusive possession for at least thirty (30) years. . .

Not being the owner, petitioner cannot maintain the present suit.















Persons who have not obtained title to public lands could not question the titles legally issued by the

State. (Reyes v. Rodriguez, 62 Phil. 771, 776 [1936]) In such cases, the real party in interest is the

Republic of the Philippines to whom the property would revert if it is ever established, after appropriate

proceedings, that the free patent issued to the grantee is indeed vulnerable to annulment on the ground

that the grantee failed to comply with the conditions imposed by the law. (See Sec. 101 of C.A. 141

[Public Land Act]; Lucas v. Durian, 102 Phil. 1157, 1158 [1957]; Sumail v. Judge of the Court of First

Instance of Cotabato, et al., 96 Phil. 946, 953 [1955]). Not being an applicant, much less a grantee,

petitioner cannot ask for reconveyance." (emphasis supplied)[52]

In the more recent case of Tankiko, et al. v. Cezar, et al.,[53] plaintiffs filed an action for reconveyance

claiming that they were the actual occupants and residents of a 126,112-square meter land which was

titled to another person. The trial court dismissed the action, but the Court of Appeals reversed the

dismissal. Despite the appellate court's finding that plaintiffs had no personality to file the action for

reconveyance, the disputed land being part of the public domain, it exercised equity jurisdiction to avoid

leaving unresolved the matter of possession of the land in dispute. On appeal to this Court, we

reinstated the decision of the trial court and dismissed the action for reconveyance, viz:

". . . equity is invoked only when the plaintiff, on the basis of the action filed and relief sought, has a

clear right that he seeks to enforce, or that would obviously be violated if the action filed were to be

dismissed for lack of standing. In the present case, respondents have no clear enforceable right, since

their claim over the land in question is merely inchoate and uncertain. Admitting that they are only

applicants for sales patents on the land, they are not and they do not even claim to be owners thereof.

Second, it is evident that respondents are not the real parties in interest. Because they admit that they

are not the owners of the land but mere applicants for sales patents thereon, it is daylight clear that the

land is public in character and that it should revert to the State. This being the case, Section 101 of the

Public Land Act categorically declares that only the government may institute an action for

reconveyance of ownership of a public land. . .

x x x

In the present dispute, only the State can file a suit for reconveyance of a public land. Therefore, not

being the owners of the land but mere applicants for sales patents thereon, respondents have no

personality to file the suit. Neither will they be directly affected by the judgment in such suit.

x x x

Clearly, a suit filed by a person who is not a party in interest must be dismissed. Thus, in Lucas v. Durian,102 Phil. 1157, September 23, 1957, the Court affirmed the dismissal of a Complaint filed by a party who

alleged that the patent was obtained by fraudulent means and consequently, prayed for the annulment

of said patent and the cancellation of a certificate of title. The Court declared that the proper party to

bring the action was the government, to which the property would revert."[54]















Similarly, as petitioner Abejaron has failed to show his title to the disputed land, he is not the proper

party to file an action for reconveyance that would result in the reversion of the land to the

government. It is the Solicitor General, on behalf of the government, who is by law mandated to

institute an action for reversion.[55] He has the specific power and function to "represent the

Government in all land registration and related proceedings" and to "institute actions for the reversion

to the Government of lands of the public domain and improvements thereon as well as lands held in

violation of the Constitution."[56] Since respondent Nabasa's Free Patent and Original Certificate of Title

originated from a grant by the government, their cancellation is a matter between the grantor and the

grantee.[57]

Having resolved that petitioner Abejaron does not have legal standing to sue and is not the real party in

interest, we deem it unnecessary to resolve the question of fraud and the other issues raised in the

petition. These shall be timely for adjudication if a proper suit is filed by the Solicitor General in the

future.

WHEREFORE, the petition is DENIED and the impugned decision of the Court of Appeals is

AFFIRMED. The Complaint filed in Civil Case No. 2492 before the Regional Trial Court of South Cotabato,

Branch 1, is DISMISSED. No costs.

SO ORDERED.













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