THIRD DIVISION
[G.R. No. 243683. November 20, 2019.]
HEIRS OF LORENZO A. CABTALAN, NAMELY: MERCEDITA CABTALAN-TANADOR, EDGARDO M. CABTALAN, REBECCA CABTALAN-PANGAN, EVELYN CABTALAN-MASING, DIOSDADO M. CABTALAN, ET AL., petitioners,vs. HEIRS OF EUSTAQUIA DE CABTALAN, NAMELY: DELFINA A. CABTALAN-BADE, REPRESENTED BY JOVENCIO CABTALAN-BADE, HEIRS OF CIRILA CABTALAN-ESCALA, NAMELY: MILAGROS ESCALA-OPALIA, COSME CABTALAN-ESCALA, JR., FLORA ESCALA-CARBA, ARMANDO CABTALAN-ESCALA, ET AL., respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Third Division, issued a Resolution datedNovember 20, 2019, which reads as follows:
"G.R. No. 243683 (Heirs of Lorenzo A. Cabtalan, namely: Mercedita Cabtalan-Tanador, Edgardo M. Cabtalan, Rebecca Cabtalan-Pangan, Evelyn Cabtalan-Masing, Diosdado M. Cabtalan, et al. v. Heirs of Eustaquia De Cabtalan, namely: Delfina A. Cabtalan-Bade, represented by Jovencio Cabtalan-Bade, Heirs of Cirila Cabtalan-Escala, namely: Milagros Escala-Opalia, Cosme Cabtalan-Escala, Jr., Flora Escala-Carba, Armando Cabtalan-Escala, et al.). — This Petition for Review on Certiorari1 assails the Decision 2 of the Court of Appeals (CA) dated January 23, 2018 in CA-G.R. CV No. 04287-MIN, which declared the transfer of the property to Lorenzo Cabtalan void for violating the five-year prohibition period under Commonwealth Act (C.A.) 141, as amended. 3
Facts of the Case
Lot No. 1443 was originally owned by Apolinario Cabtalan, who died in 1916. His son, Gabriel Cabtalan, married to Eustaquia De Cabtalan (Eustaquia), inherited the property. The couple had six children, namely, Necitas, Lorenzo, Marciano, Mercedes, Cirila and Delfina. After his death in 1936, Eustaquia and her six children inherited the subject property. Upon the death of Eustaquia in 1955, Free Patent No. V34221 was granted in the name of the Heirs of Eustaquia. On the same year, such land was titled under the name of Heirs of Eustaquia denominated as Original Certificate of Title (OCT) No. P-757. 4
On November 20, 1956, OCT No. P-757 was cancelled and Transfer of Certificate of Title (TCT) No. T-174 was issued under the name of Lorenzo based on the extrajudicial settlement executed by the siblings on the same day adjudicating the land to Lorenzo. TCT No. T-174 was administratively reconstituted when it was presumed to be among those that were burned, hence, TCT No. RT-36 (T-174) was issued still in the name of Lorenzo. 5
In 1957, another extrajudicial settlement was executed by the Heirs of Eustaquia adjudicating another property they inherited from their parents to their sibling, Marciano. In 1974, the siblings entered into an extrajudicial settlement adjudicating the remaining properties unto themselves with the exception of Lorenzo and Marciano who already had their own shares by virtue of the 1956 and 1957 Extra Judicial Settlements. 6
On December 20, 2012, heirs of Eustaquia de Cabtalan, namely: Delfina and the Heirs of Cirila, Mercedes, Marciano and Necitas Cabtalan (collectively, respondents) filed a Complaint 7 for Declaration of Nullity of Transfer Certificate of Title, Extrajudicial Settlement of Estate with Prayer for Damages and Attorney's Fees against the Heirs of Lorenzo A. Cabtalan (petitioners). 8 Delfina denied the execution of the 1956 extrajudicial settlement in favor of Lorenzo. The same was allegedly fraudulent because the rest of the siblings were tricked to sign blank papers by Lorenzo when they entrusted to him the registration of the land. Respondents added that assuming that the extrajudicial settlement was duly executed, the same was void as it violated the five-year prohibition on alienation of a land granted under a free patent pursuant to C.A. 141, as amended. 9
Petitioners, on the other hand, alleged that the Cabtalan siblings agreed that the land was Lorenzo's advance inheritance, and the other lands belonging to their parents were adjudicated to the other siblings later on as evidenced by the 1957 and 1974 extrajudicial settlements. 10 According to them, the five-year prohibition on alienation does not apply since the alienation was in favor of a co-owner. 11 Lastly, petitioners put up the defense of prescription and lathes as the complaint questioning the execution of the extrajudicial settlement was filed 56 years from the same. 12
RTC Ruling
The Regional Trial Court of Iligan City, Lanao Del Norte, Branch 1 (RTC) in its February 24, 2016 Decision 13 dismissed the case and held that the silence of respondents for 56 years had been viewed as evidence that they indeed have no basis to challenge the 1956 extrajudicial settlement. 14 Additionally, the RTC was convinced that the alienation of the subject property was not in violation of the five-year prohibition since the transferee was a co-owner. 15 Also, if the share of Lorenzo is declared to be commonly owned by the siblings, it would be unjust to petitioners, since the shares of respondents adjudicated to them under the 1957 and 1974 extrajudicial settlements were owned by them exclusively. 16 Lastly, assuming that the 1956 agreement was void, the parties were in pari delicto, hence, they will be left as they are. 17
Aggrieved, respondents filed their appeal with the CA.
CA Ruling
On January 23, 2018, the CA rendered its Decision 18 reversing the Decision of the RTC dated February 24, 2016. It held that, while TCT No. T-174 cannot be nullified on the basis of fraud because the same should have been filed four years from the discovery of fraud reckoned from November 20, 1956 when the TCT was issued. 19 Be that as it may, C.A. 141, as amended, prohibits the alienation or encumbrance of a land subject of a free patent except in favor of the government. 20 The alienation, therefore, in favor of Lorenzo, a co-owner, is covered by this prohibition. 21 The violation of the five-year prohibition will cause reversion of the subject property to the government; however, since it is only the Republic which can move for reversion, respondents shall have a better right thereto. 22 The pari delicto rule does not apply in this case since it would go against public policy and lastly, the issue of unjust enrichment should be adjudged in another proceeding since the other extrajudicial settlements are not assailed in this case. 23
After their motion for reconsideration was denied by the CA, petitioners filed this petition. Respondents filed their comment.
Issue
The main issue in this case is whether or not the transfer to Lorenzo of the subject land through the extra judicial settlement is void.
Our Ruling
In as much as the law and jurisprudence has settled that the alienation or encumbrance of lands acquired under free patent or homestead provisions within five years from and after the date of the issuance of the patent or grant shall be null and void, 24 Republic Act No. 11231, otherwise known as the Agricultural Free Patent Reform Act, which became effective on May 15, 2019, however, provided that:
Section 3. Agricultural public lands alienated or disposed in favor of qualified public land applicants under Section 44 of Commonwealth Act No. 141, as amended, shall not be subject to restrictions imposed under Sections 118, 119 and 121 thereof regarding acquisitions, encumbrances, conveyances, transfers or dispositions. Agricultural free patent shall now be considered as title in fee simple and shall not be subject to any restriction on encumbrance or alienation. 25
Moreover, the new law provides for a "retroactive effect and any restriction regarding acquisitions, encumbrances, conveyances, transfers or dispositions imposed on agricultural free patents issued under Section 44 of Commonwealth Act No. 141, as amended, before the effectivity of this Act shall be removed and are hereby immediately lifted x x x." 26
By virtue of this new law, the conveyance of the subject property to Lorenzo in 1956 is validated. There is no more legal basis to nullify the said transfer of ownership within the five-year period from the issuance of the patent.
WHEREFORE, the petition is GRANTED. The transfer of the property in the name of Lorenzo A. Cabtalan is now validated because the restriction against encumbrances, conveyances, transfers or dispositions of the property granted under free patent was removed pursuant to the provisions of Republic Act No. 11231.
SO ORDERED." (Leonen, J., on official business; Gesmundo, J., designated as Acting Chairperson of the Third Division per Special Order No. 2737; Lazaro-Javier, J., designated as Additional Member of the Third Division per Special Order No. 2728, on official leave.)
Very truly yours,
(SGD.) MISAEL DOMINGO C. BATTUNG IIIDeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 3-35.
2. Penned by Associate Justice Perpetua T. Atal-Paño, with Associate Justices Edgardo A. Camello and Walter S. Ong, concurring; id. at 40-66.
3.Id. at 63-65.
4.Id. at 72.
5.Id.
6.Id. at 72-73.
7.Id. at 138-148.
8.Id. at 146-147.
9.Id. at 146.
10.Id. at 153.
11.Id. at 160.
12.Id. at 160-161.
13. Penned by Presiding Judge Alberto P. Quinto; id. at 71-75.
14.Id. at 73-74.
15.Id. at 74.
16.Id.
17.Id. at 75.
18.Supra note 2.
19.Id. at 50-52.
20.Id. at 53-59.
21.Id.
22.Id. at 63-64.
23.Id. at 64.
24. Section 118 in relation to Section 124 of C.A. 141, as amended.
25. Republic Act No. 11231, Section 3.
26. Republic Act No. 11231, Section 4.