Republic of the Philippines
G.R. No. 216597 | August 26, 2020
Emiliana J. Esguerra, Substituted by Her Heirs, Petitioners,
Spouses Teofilo Ignacio and Julita V. Ignacio, Spouses Raul Giray Japson and Teodora Alido Japson, and Asia Cathay Finance and Leasing Corporation, Respondents.
D E C I S I O N
By these consolidated appeals by certiorari, petitioners assail the Decision and Resolution promulgated on September 24, 2014 and January 5, 2015, respectively, by the Honorable Court of Appeals (CA) in CA-G.R. CV No. 98910, whereby the appellate court reversed and set aside the February 23, 2012 Decision of the Regional Trial Court, City of Malolos, Bulacan, Branch 19 (RTC) in Civil Case No. 64-M-2004 and ordered the dismissal of the complaint for Cancellation of Titles, Declaration of Ownership, Reconveyance and Damages.
The CA summarized the factual and procedural milieu of the case, thus:
On 29 January 2004, plaintiff-appellee filed a complaint for Cancellation of Titles, Declaration of Ownership, Reconveyance and Damages against defendants-appellants. She claimed that an 877 sq.m. portion of her 2,988 sq. m. parcel of land that is part of Lot 1347 of Pulilan Cadastre located at Dampol 1st, Pulilan, Bulacan was mistakenly encompassed in Lot 1788 covered by OCT No. P-2142 which is a free patent title issued in the name of defendants-appellants.
Plaintiff-appellee alleged that she inherited the land from her uncle, Macario Cruz, sometime in 1970. This property is adjacent to Lot 1788 Cad. 345 Pulilan Cadastre that is owned in common by Marciana Reyes, Ursula Reyes and Regina Panganiban, and the lots are segregated by trees and hedges that serve as a common fence. On 25 February 1976, plaintiff-appellee sold a 187.5 sq.m. portion of her property to Arturo Eusebio which he uses as a right of way up to the present.
Sometime in the 1990s, plaintiffs-appellee learned that Lot 1788 was sold to defendants-appellants. Spouses Ignacio who immediately applied for and obtained a free patent title OCT No. P-2142, for a parcel of land covering an area of 7,388 sq.m. However, in 1995, she discovered that a portion of her property and the right of way that was sold to Eusebio were encompassed by the lot of defendants-appellants Spouses Ignacio. Consequently, in May 1996, plaintiff-appellee and Eusebio filed a protest before the Department of Environment and Natural Resources (DENR) contesting the issuance of OCT No. P-2142 to Spouses Ignacio. A survey was conducted by Engr. Librado R. Gellez which confirmed that indeed, a portion of plaintiff-appellee’s property, including Eusebio’s right of way, were mistakenly encompassed in the property covered by OCT No. P-2142. The DENR then wrote a letter dated 11 August 1998 to the Office of the Solicitor General (OSG) recommending the cancellation of OCT No. P-2142, but no action was taken by the OSG. After following up the matter with DENR in August 2003, plaintiff-appellee was advised to file an action for cancellation of title by herself. She first sought barangay conciliation before the Lupon, but it was not successful. On 21 November 2003, plaintiff-appellee’s son (Cenon Esguerra) went to the Register of Deeds of Bulacan to register a Notice of Lis Pendens. He discovered that OCT No. P-2142 has already been cancelled and subdivided into two (2) sublots, namely: a) TCT No. T-152003 which was mortgaged with Asia-Cathay Finance Leasing Corporation on 11 April 2002, and b) TCT No. T-152004 which was sold to Sps. Japson on 05 September 2003 and thus, replaced with TCT No. T-181601. Plaintiff-appellee eventually filed the instant action of Cancellation of Titles, Declaration of Ownership, Reconveyance, and Damages with respect to the 877 sq.m. portion that she was claiming.
After learning of the filing of this action, the heirs of Regina Panganiban designated in her Last Will and Testament filed a Complaint-in-Intervention against defendants-appellants Ignacio claiming that the latter applied for and acquired the land covered by OCT No. P-2142 through fraud. They alleged that defendants-appellants Ignacio used a forged Deed of Absolute Sale dated 15 February 1994 in their favor. This is evidently a falsified document because Regina died on 10 March 1982. The heirs of Regina thus joined plaintiff-appellee in the action for cancellation of OCT No. P-2142 and its derivative titles and prayed for the reconveyance of the shares of Regina.
On the other hand, defendants-appellants Sps. Ignacio contended that plaintiff-appellee could not have been an heir of Macario Cruz because the latter had several children; and in fact, had no will at all. Moreover, a mere tax declaration cannot convincingly prove his ownership. During her testimony, however, it was admitted that there is an existing right of way that is being used by Eusebio, and that there are mango trees that apparently served as boundaries of the adjacent properties.
On account of the Complaint-in-Intervention, defendants-appellants filed a Third-Party Complaint against the Heirs of Regina, who are also the Fleirs of Felisa Panganiban from whom they bought Lot 1788. It is claimed that the aforementioned property was owned by Marciana Reyes to the extent of one-half, and the other half was owned by Ursula Reyes and Regina Panganiban. When Ursula died, the heirs sold this half share to Regina; thus, Regina’s interest is only one-half. According to defendants-appellants, it was intervenor-appellee Dominador Panganiban, Jr. (Regina’s nephew), his son and third party defendant-appellee Luisito Panganiban, and Felisa (Regina’s sister) who offered to sell Regina’s half share to them and represented that they had authority to do so. Felisa then executed a Pagpapatunay dated 12 November 1993 attesting to the transfer of Regina’s share to spouses Ignacio for a consideration of Three Hundred Seventy Thousand Pesos (P370,000.00). Thereafter, an Assignment of Rights, Interest and Participation dated 10 May 1994 was executed between defendants-appellants, Felisa and all the heirs of Marciana Reyes. Similarly, the Heirs of Marciana Reyes also sold their half share and executed a Kasunduan sa Pagbili ng Lupa na may Paunang Bayad with defendants-appellants on 05 February 1994 for a consideration of Five Hundred Sixty Nine Thousand Pesos (P569,000.00).
Defendants-appellants claimed good faith and non-participation in the processing of their title because it was Dominador, Luisito and Felisa who arranged and processed the issuance of the free patent title in their (Spouses Ignacio) behalf. They only paid Felisa the consideration for the sale of the property. Be that as it may, defendants-appellants Ignacio aver that even after the sale and issuance of OCT No. P-2142, intervenors-appellees have never questioned the transaction and the consequent ownership of defendants-appellants over the property until plaintiff-appellee, who is a relative of intervenors-appellees, filed her complaint for cancellation of title and recovery of ownership.
Judgment of the RTC
After trial, the RTC ruled in favor of Esguerra and heirs of Regina Panganiban. In doing so, the RTC found that there was, indeed, a mistake in the application of the free patent as it included an 877-sq.m. portion of Lot 1347 which was owned by Esguerra. Even the DENR admitted that the free patent inadvertently encroached on Lot 1347 to the extent Esguerra claimed. On this basis, the RTC declared OCT No. P-2142, together with the derivative titles, as null and void.
Further, the trial court noted that the non-encroaching portions of OCT No. P-2142 are owned in common by the heirs of Regina Panganiban and Spouses Ignacio being the successors-in-interest of Regina Panganiban and Marciana Reyes. The dispositive portion reads:
WHEREFORE, judgment is hereby rendered as follows:
- The Free Patent awarded to the defendants Spouses Ignacio is hereby ordered annulled and voided;
- OCT No. P-2142 issued in the name of defendants Spouses Teofilo Ignacio and Julita Ignacio and its derivative titles Nos. 152003 and 152004 (admitted by Julita Ignacio to have been sold/mortgaged but reconveyed to them) and any such derivative titles are declared null and void;
- Ordering the segregation to the extent of 877 square meters from Lot No. 1788-Cad 345 Pulilan Cadastre adjacent to Lot 1347 rightfully and legally owned by plaintiff and Arturo Eusebio as successor-in-interest on the road right of way;
- After segregation of 877 square meters, ordering the partition of Lot No. 1788 Cad 345 Pulilan Cadastre into two: One half (1/2) share in favor of the heirs of Regina Panganiban and the other one half (1/2) share of defendants Spouses Ignacio as successors-in-interest of Marciana Reyes;
- Ordering the defendants Spouses Ignacio to pay plaintiff the sum of P50,000.00 as and by way of Attorney’s fees;
- Ordering defendants Spouses Ignacio to pay the intervenors the sum of P50,000.00 as and by way of Attorney’s fees;
- Ordering defendants Spouses Ignacio to pay costs of suit.
All other claims of plaintiff and intervenors as well as the third-party complaint, counterclaims of defendants Spouses to the complaint and complaint in-intervention are all dismissed for lack of legal and factual basis.
Aggrieved, Spouses Ignacio appealed the RTC decision before the CA.
Judgment of the CA
As stated, the CA reversed the decision of the trial court and ordered the dismissal of the complaint and the Complaint-in-Intervention. The CA ruled that both Esguerra and the heirs of Regina Panganiban have no legal interest and no cause of action in the suit because the action is one of reversion that only the Office of the Solicitor General (OSG) can commence. In concluding that the suit is one for reversion, the appellate court pointed out that prior to 1978, the said property was public land. As such, it is only the government which could impugn the validity of the State’s grant. The fallo reads:
WHEREFORE, foregoing considered, the appeal is GRANTED in part. Except for the dismissal of the other claims of plaintiff and intervenors as well as the Third-Party Complaint and counterclaims of defendants Spouses Ignacio to the Complaint and Complaint-in-Intervention, the dispositions (Items 1 to 7, inclusive) in the appealed Decision dated 23 February 2012 of the Regional Trial Court, Branch 19, Bulacan are REVERSED and SET ASIDE, and another judgment is rendered dismissing the Amended Complaint and Complaint-in-Intervention.
The subsequent Motions for Reconsideration of Esguerra and the heirs of Regina Panganiban were also denied by the CA. Hence, this recourse.
Petitioner Esguerra raises the sole issue of:
WHETHER THE HONORABLE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT REVERSED THE DECISION OF THE RTC BRANCH 19, AND RULED THAT THIS CASE IS AN ACTION FOR REVERSION.
For their part, the heirs of Regina Panganiban assigned their sole error, thus:
REVERSIBLE ERRORS WERE COMMITTED BY THE COURT OF APPEALS WHEN IT REVERSED AND SET ASIDE THE DECISION OF THE TRIAL COURT, AND ENTER ANOTHER JUDGMENT DISMISSING THE AMENDED COMPLAINT AND COMPLAINT IN INTERVENTION, REASONING OUT THAT THE PROPERTY IS A PART OF A PUBLIC DOMAIN BEFORE THE ISSUANCE OF RESPONDENT’S PATENTED OCT NO. P-2142, AND IT IS A CASE OF REVERSION NOT RECONVEYANCE, AND THAT IT SHOULD BE THE STATE NOT THE PETITIONERS WHO SHALL INSTITUTE THE ACTION THROUGH THE OSG.
The petitioners are in unison in arguing that the CA erred in ruling that they do not have the legal standing in pursuing the instant suit. They claim that the instant case is not one of reversion but merely a case of cancellation of free patents which they, as aggrieved private individuals, may commence citing Tancuntian v. Gempesaw. Here, they claim that they have clearly established their ownership prior to the application and grant of the free patent in favor of Julita Ignacio. As such, the proper remedy is not reversion but rather the cancellation of the free patent.
In response, Spouses Ignacio argue that the action is one of reversion since the land was originally a pubic land granted in favor of a private individual. Thus, any question as to the validity of the transfer should be an issue between the grantor and the grantee. Also, they argue that the free patent was validly granted to them considering the Pagpapatunay signed by Felisa Panganiban, one of the heirs of Regina Panganiban. Lastly, even assuming that the petitioners have a cause of action against them, Spouses Ignacio claim the same had already prescribed as 10 years had passed since its transfer from Felisa Panganiban to them. As such, they pray that the decision of the CA be affirmed.
Ruling of the Court
The petitions are meritorious.
The appellate court ruled that this is a case of reversion of property. The Court disagrees.
In Heirs of Kionisala v. Heirs of Dacut, the Court distinguished between an action for nullity or cancellation of free patents, an action for reversion and an action for reconveyance, thus:
An ordinary civil action for declaration of nullity of free patents and certificates of title is not the same as an action for reversion. The difference between them lies in the allegations as to the character of ownership of the realty whose title is sought to be nullified. In an action for reversion, the pertinent allegations in the complaint would admit State ownership of the disputed land. Hence in Gabila v. Barriga where the plaintiff in his complaint admits that he has no right to demand the cancellation or amendment of the defendant’s title because even if the title were canceled or amended the ownership of the land embraced therein or of the portion affected by the amendment would revert to the public domain, we ruled that the action was for reversion and that the only person or entity entitled to relief would be the Director of Lands.
On the other hand, a cause of action for declaration of nullity of free patent and certificate of title would require allegations of the plaintiffs ownership of the contested lot prior to the issuance of such free patent and certificate of title as well as the defendant’s fraud or mistake; as the case may be, in successfully obtaining these documents of title over the parcel of land claimed by plaintiff. In such a case, the nullity arises strictly not from the fraud or deceit but from the fact that the land is beyond the jurisdiction of the Bureau of Lands to bestow and whatever patent or certificate of title obtained therefor is consequently void ab initio. The real party in interest is not the State but the plaintiff who alleges a pre-existing right of ownership over the parcel of land in question even before the grant of title to the defendant. In Heirs of Marciano Nagano v. Court of Appeals we ruled —
xxx from the allegations in the complaint x x x private respondents claim ownership of the 2,250 square meter portion for having possessed it in the concept of an owner, openly, peacefully, publicly, continuously and adversely since 1920. This claim is an assertion that the lot is private land xxx Consequently, merely on the basis of the allegations in the complaint, the lot in question is apparently beyond the jurisdiction of the Director of the Bureau of Lands and could not be the subject of a Free Patent. Hence, the dismissal of private respondents’ complaint was premature and trial on the merits should have been conducted to thresh out evidentiary matters. It would have been entirely different if the action were clearly for reversion, in which case, it would have to be instituted by the Solicitor General pursuant to Section 101 of C.A. No. 141 xxx
It is obvious that private respondents allege in their complaint all the facts necessary to seek the nullification of the free patents as well as the certificates of title covering Lot 1015 and Lot 1017. Clearly, they are the real parties in interest in light of their allegations that they have always been the owners and possessors of the two (2) parcels of land even prior to the issuance of the documents of title in petitioners’ favor, hence the latter could only have committed fraud in securing them —
xxx That plaintiffs are absolute and exclusive owners and in actual possession and cultivation of two parcels of agricultural lands herein particularly described as follows [technical description of Lot 1017 and Lot 1015] x x x 3. That plaintiffs became absolute and exclusive owners of the abovesaid parcels of land by virtue of inheritance from their late father, Honorio Dacut, who in turn acquired the same from a certain Blasito Yacapin and from then on was in possession thereof exclusively, adversely and in the concept of owner for more than thirty (30) years x x x 4. That recently, plaintiff discovered that defendants, without the knowledge and consent of the former, fraudulently applied for patent the said parcels of land and as a result thereof certificates of titles had been issued to them as evidenced by certificate of title No. P-19819 in the name of the Hrs. of Ambrocio Kionisala, and No. P-20229 in the name of Isabel Kionisala x x x 5. That the patents issued to defendants are null and void, the same having been issued fraudulently, defendants not having been and/or in actual possession of the litigated properties and the statement they may have made in their application are false and without basis in fact, and, the Department of Environment and Natural Resources not having any jurisdiction on the properties the same not being anymore public but already private property x x x
It is not essential for private respondents to specifically state in the complaint the actual date when they became owners and possessors of Lot 1015 and Lot 1017. The allegations to the effect that they were so preceding the issuance of the free patents and the certificates of title, i.e., “the Department of Environment and Natural Resources not having any jurisdiction on the properties the same not being anymore public but already private property,” are unquestionably adequate as a matter of pleading to oust the State of jurisdiction to grant the lots in question to petitioners. If at all, the oversight in not alleging the actual date when private respondents’ ownership thereof accrued reflects a mere deficiency in details which does not amount to a failure to state a cause of action. The remedy for such deficiency would not be a motion to dismiss but a motion for bill of particulars so as to enable the filing of appropriate responsive pleadings.
With respect to the purported cause of action for reconveyance, it is settled that in this kind of action the free patent and the certificate of title are respected as incontrovertible. What is sought instead is the transfer of the property, in this case the title thereof, which has been wrongfully or erroneously registered in the defendant’s name. All that must be alleged in the complaint are two (2) facts which admitting them to be true would entitle the plaintiff to recover title to the disputed land, namely, (1) that the plaintiff was the owner of the land and, (2) that the defendant had illegally dispossessed him of the same. (emphasis supplied; citations omitted)
Following the rules laid down above, an examination of the allegations in the complaint and the Complaint-in-Intervention would reveal that the action is one for nullity or cancellation of free patents rather than reversion.
The petition alleges that Esguerra, particularly Emiliana, inherited 2,988 sq.m. from the owner Macario Cruz; in 1976, she sold 187.5 sq.m. of her 2,988 sq.m. in favor of Arturo Eusebio who used the same as right of way to the barangay road; in the early 1990’s, the adjacent lot co-owned by Marciana Reyes, Ursula Reyes and Regina Panganiban was sold to Julieta Ignacio who used the same in her application for free patent and the issuance of OCT No. P-2142; in 1995, they discovered that OCT No. P-2142 encroached a total of 877 sq.m. including the 187.5 sq.m. of Arturo Eusebio; and despite adopting measures to protect their interest, these remedies proved to be futile.
On the other hand, the Complaint-in-Intervention alleges that Regina Panganiban co-owns a property with Marciana Reyes and Ursula Reyes by virtue of succession; the property was denominated as Lot 1788, Cad-345, Pulilan Cadastre; the property was titled in favor of Julita Ignacio through a free patent; the free patent was secured through fraud because Julita Ignacio used two (2) falsified Deeds of Sale, one with Regina Panganiban and another with Marciana Reyes; and they are joining petitioner Esguerra in the suit in so far as that portion of Lot 1788, Cad-345 of Pulilan Cadastre is concerned.
Here, both initiatory pleadings allege prior ownership of Emiliana Esguerra and the heirs of Regina Panganiban; how the property of Emiliana was alleged to been mistakenly included in the free patent; and how Julita Ignacio fraudulently secured the free patent to the prejudice of the heirs of Regina Panganiban. Neither initiatory pleading admits State ownership of the property.
Hence, the CA was incorrect in concluding that the suit is one of reversion when the allegations clearly make up a case for nullity or cancellation of free patents. The CA’s reversal of the RTC decision on procedural grounds, therefore, should not be sustained.
While the consolidated petitions limited their discussions to the procedural aspect of the case, respondents’ comment defended their ownership of the entire property covered by OCT No. P-2142. Thus, the Court can still rule on the correctness of the RTC’s judgment and a review of the records compels this Court to affirm the RTC’s decision.
There are constant truisms in civil litigations. In Spouses Pamplona v. Spouses Cueto, the Court explains these propositions , thus:
At the start, the Court reiterates the general proposition that is true in all civil litigations that the burden of proof lies in the party who asserts, not in the party who denies because the latter, by the nature of things, cannot produce any proof of the assertion denied. Equally true is the dictum that mere allegations cannot take the place of evidence. The party making an allegation in a civil case has the burden of proving the allegation by preponderance of evidence. In this connection, preponderance of evidence is the weight, credit, and value of the aggregate evidence on either side and is usually considered to be synonymous with the term “greater weight of evidence” or “greater weight of credible evidence.”
Here, petitioners were able to discharge their respective onus probandi by sufficient evidence. In ruling for Esguerra, the RTC ruled that:
Against the overwhelming evidence against them, defendants were not able to marshall any proof to the contrary. In fact, Julita Ignacio testified that while she admitted to have filed the Free Patent application, she did not submit any document to prove substantial compliance with the requirements of the Free Patent. They did not attend the hearings of the application, neither was she aware of the requirements of the Free Patent. She admitted to having first possessed the subject property when she applied for Free Patent in 1993.
With the introduction of the evidence which even the Department of Environment & Natural Resources recommended the exclusion of the land area of Emiliana Esguerra, coupled with the defendants’ admissions in Court that she never submitted any documents nor participated in the proceedings of the Free Patent application and testimony of Arturo Eusebio, it behooves the Court to grant relief to the plaintiff and exclude from OCT No. P-2142 the land area of 877 square meters of the plaintiff. As the Free Patent application was marred by fraud and misrepresentation voiced out by the DENR personnel themselves, it is incumbent to annul OCT No. P-2142 and its derivative titles TCT No. 152003 and T-152004 both registered in the name of Julita Ignacio and consequently a partition/relocation should be undertaken to determine the metes and bounds of the 877 square meters of land of the plaintiff encroached by the defendants spouses Ignacio in Lot No. 1788 Cad. 345.
As regards the Complaint-in-Intervention, the RTC found that the property was equally divided between Regina Panganiban and Marciana Reyes and that the latter’s share was transferred to Julita Ignacio. The trial court noted that the error or fraud here was that instead of covering only half of the property corresponding to the share of Marciana Reyes in the application, it covered the entire property including the share of Regina Panganiban. The trial court did not rule on the validity of the transfer from Marciana Reyes to Julita Ignacio since the said transaction was not questioned. Lastly, the RTC found no evidence showing that Regina Panganiban sold her interest in the property in favor of Julita Ignacio as Felisa Panganiban had no right to convey the property or any interest thereto; on the contrary, Julita’s evidence acknowledged the one-half (1/2) interest of Regina Panganiban over the property.
The Court sustains these factual findings. It must be remembered that factual findings of the trial court will not be disturbed on appeal unless the court has overlooked or ignored some fact or circumstance of sufficient weight or significance, which, if considered, would alter the result of the case. Here, there are no circumstances to warrant the reversal of the trial court’s factual findings.
WHEREFORE, the Court GRANTS the petitions; REVERSES and SETS ASIDE the Decision and Resolution promulgated on September 24, 2014 and January 5, 2015, respectively, of the Court of Appeals in CA-G.R. CV No. 98910; and REINSTATES the Decision dated February 23, 2012 of the Regional Trial Court, City of Malolos, Bulacan, Branch 19, in Civil Case No. 64-M-2004.
Leonen, (Chairperson), Carandang, Zalameda, and Gaerlan, JJ., concur.
NOTICE OF JUDGMENT
Sirs / Mesdames:
Please take notice that on August 26, 2020 a Decision, copy attached hereto, was rendered by the Supreme Court in the above-entitled cases, the original of which was received by this Office on December 1, 2020 at 3:30 p.m.
Very truly yours,
(SGD) MISAEL DOMINGO C. BATTUNG III
Division Clerk of Court
 Rollo(G.R. No. 216668), pp. 56-66; penned by Associate Justice Manuel M. Barrios with Associate Justices Normandie B. Pizarro (retired) and Pedro B. Corales, concurring.
 Id. at 75-77.
 Id. at 18-53; penned by Presiding Judge Renato C. Francisco.
 Id. at 58-61.
 Id. at 52-53.
 Id. at 65.
 Rollo (G.R. No. 216597), p. 20.
 Rollo (G.R. No. 216668), pp. 6-7.
 483 Phil. 459 (2004).
 428 Phil. 249 (2002).
 Id. at 260-262.
 G.R. No. 204735, February 19, 2018, 856 SCRA 33.
 Id. at 48-49.
 Rollo (G.R. No. 216668), p. 45.
 Sumbad v. Court of Appeals, 368 Phil. 52, 66 (1999).