SECOND DIVISION
[G.R. No. 211958. March 14, 2018.]
HEIRS OF ILDEFONSO LOYOLA, NAMELY: IDES LOYOLA, ILDEFONSO LOYOLA, JR., HEIRS OF IRMA LOYOLA GARCIA, ISAGANI LOYOLA, IRENE LOYOLA-MACAALAY AND IRNIE LOYOLA, petitioners,vs. SPOUSES ISIDRO L. NAVEA AND LYDIA R. NAVEA, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Second Division, issued a Resolution dated14 March 2018which reads as follows: HTcADC
"G.R. No. 211958 (Heirs of Ildefonso Loyola, namely: Ides Loyola, Ildefonso Loyola, Jr., Heirs of Irma Loyola Garcia, Isagani Loyola, Irene Loyola-Macaalay and Irnie Loyola vs. Spouses Isidro L. Navea and Lydia R. Navea). — Before the Court is a petition for review 1 filed by the Heirs of Ildefonso Loyola (Ildefonso), namely: Ides Loyola (Ides), Ildefonso Loyola, Jr. (Ildefonso, Jr.), Heirs of Irma Loyola Garcia (Irma), Isagani Loyola (Isagani), Irene Loyola-Macaalay (Irene), and Irnie Loyola (Irnie) (hereinafter referred to as petitioners) under Rule 45 of the 1997 Rules of Civil Procedure seeking to annul and set aside the Decision 2 dated July 10, 2013 of the Court of Appeals (CA) in CA-G.R. CV No. 95457, and its Resolution 3 dated January 21, 2014, denying the motion for reconsideration thereof. The assailed decision granted the appeal filed by Spouses Isidro L. Navea (Isidro) and Lydia R. Navea (hereinafter referred to as respondent spouses) and accordingly reversed and set aside the Decision 4 dated February 17, 2010 of the Regional Trial Court (RTC) of Masbate City, Branch 46, in Civil Case No. 5341.
The antecedent facts follow:
The subject of the instant controversy is a parcel of land containing an area of 3.9394 hectares more or less, and owned by Isidro Loyola per Tax Declaration No. 8669. Following the death of Isidro Loyola, his heirs sold a portion of the lot to the respondent spouses on November 16, 1971. The sale was evidenced by a notarized Deed of Absolute Sale registered in the Office of the Registry of Deeds of Masbate, Masbate on March 13, 1972. The lot was thereafter occupied and cultivated by the respondent spouses, and declared for taxation purposes under the name of respondent Isidro. 5
As described in the aforementioned Deed and alleged by the respondent spouses, the lot sold consists of an area of 640 square meters, more or less, is located at Barangay Nursery, Masbate City, and
[b]ounded on the North, by Jose P. Mitra and the Provincial Government of Masbate; on the East and South, by the Heirs of Isidro Loyola and on the West, by Proposed callejon two (2) meters wide. 6
In 1984, petitioners contracted the services of Engineer Felomino Ramirez (Engr. Ramirez) to cause the segregation survey of the mother lot. Allegedly Engr. Ramirez was at that time unaware that a portion of the lot to be segregated has already been sold to the respondent spouses, thus he included therein the portion already sold to respondent spouses. The survey was approved on November 22, 1984. 7
In November 1995, the petitioners applied for a free patent over their share in the mother lot, corresponding to 4,054 sq.m. Acting on petitioners' representation that the land subject of the application is not claimed or occupied by any other person, OCT No. P-18357 was issued on March 6, 1998. 8
In 2002, petitioners, through Engineer Ramirez, caused the partition of the lot covered by Original Certificate of Title (OCT) No. P-18357, which then led to the issuance of seven titles under Psd-05-032169, to wit: Transfer Certificate of Title (TCT) No. T-13344 issued in the name of Ides, TCT No. T-13345 issued in the name of Ildefonso, Jr., TCT No. T-13346 issued in the name of Irma, TCT No. T-13347 issued in the name of Isagani, TCT No. T-13349 issued in the name of Irene, TCT No. T-13348 issued in the name of Irnie, and TCT No. 13350 issued in common to the petitioners. 9
Alleging that their property has wrongfully been included in the partition and distributed to the petitioners, a Complaint for Cancellation/Annulment of Original and Transfer Certificates of Title and Damages filed by respondent spouses before the Regional Trial Court of Masbate City. Per relocation survey conducted by Engineer Miguel E. Reyes on May 13, 2002, the property sold to the respondent spouses are Lot 4229-A and a portion of Lot 4229-B, covered by TCT Nos. T-13344 and T-13345. 10
Therein, respondent spouses claimed that their property has wrongfully been included in the OCT No. P-18357 and Free Patent Number 054111-99, issued in the name of Ildefonso sometime in April 2002, owing to petitioners' misrepresentation and connivance with Engr. Ramirez. In this light, respondent spouses impleaded Engr. Ramirez, the Provincial Environment and Natural Resources Officer, and the Register of Deeds of Masbate as defendants in the case below. 11
On February 17, 2010, the RTC of Masbate City, Branch 46, rendered its Decision, 12 dismissing the complaint in this wise:
WHEREFORE, premises considered, this hereby orders the following:
1. Declaring the [OCT No.] P-18357 and its derivative [TCT Nos.] T-13341; T-13342; T-13343; T-13344; T-13345; T-13346 and T-13347 of PSD-05-032169 Cad. 627 Masbate Cadastre as valid and subsisting; HEITAD
2. Dismissing the suit against [Engr. Ramirez] without costs;
3. Dismissing the suit against the nominal defendants PENRO Officer and the Register of Deeds; and
4. No other costs.
SO ORDERED. 13
The RTC held that since one year has lapsed since the issuance of OCT No. P-18357, without any petition for reopening and review being filed, such title has become indefeasible and conclusive as to the petitioners' title over the lot. 14
Finally, while the RTC recognized the validity of the notarized deed of sale executed in favor respondent spouses, it nonetheless adjudged the latter to be guilty of laches which thus bars them from asserting their claim. 15
Aggrieved, respondent spouses interposed an appeal before the CA, which rendered the herein assailed Decision 16 dated July 10, 2013, the dispositive portion of which reads:
WHEREFORE, the instant appeal is GRANTED. The assailed Decision dated February 17, 2010 of the [RTC] of Masbate City, Branch 46, in Civil Case No. 5341, is REVERSED AND SET ASIDE. Accordingly, the [TCTs] in the name of [petitioners], covering/encroaching the subject property/land owned by the [respondent spouses] are hereby ordered CANCELLED.
SO ORDERED. 17
In so ruling, the CA ratiocinated that respondent spouses' right of ownership must be respected and that prescription does not run to bar them of asserting the same considering that they are in possession of the property since 1972. 18
Moreover, the CA held that by definition, extrinsic fraud pertains to an act committed outside of trial. Thus, while the use of forged or fake documents in the action for reconstitution before the RTC prevented the full adjudication of the case on the merits, the CA ruled that it cannot be considered as extrinsic fraud. 19
Petitioners sought a reconsideration of the Decision dated July 10, 2013 but the CA denied it in its Resolution 20 dated January 21, 2014.
Thus, this petition for review for certiorari filed by the petitioners, submitting a lone issue for this Court's Resolution, to wit:
Whether or not the Honorable CA erred in reversing the appealed Decision off the RTC of Masbate-Branch 46, on the sole ground that respondent spouses are not guilty of laches, since they were allegedly in possession of the property in question. 21
Petitioners in support of their position argue that they are the rightful owners of the property in question; that the dismissal of a land registration case does not bar the titling of a land by way of a free patent application; and that OCT No. P-18357 has become incontrovertible considering that one year has already elapsed since its entry in the records of the Registry of Deeds. 22
Ruling of the Court
The Court is not persuaded.
An action for reconveyance is a recognized remedy available to a person whose property has been wrongfully registered under the Torrens System in the name of another. The institution of this action does not contradict the indefeasibility of the Torrens Title, as the object thereof is not to set aside the decree, which is incontrovertible and not subject to review except in a direct proceeding. Rather, in an action for reconveyance what is sought is the transfer of the property erroneously registered from the name of the registered owner to that who possesses a better right over it. 23
Section 53, paragraph 3 of Presidential Decree No. 1529, in relation to Articles 1456 24 and 1144 (2) 25 the Civil Code, provides that an action for the reconveyance of a fraudulently registered property is 10 years reckoned from the date of the issuance of the certificate of title. However, where the party seeking reconveyance on the ground of fraud is in actual, continuous, and peaceful possession of the property involved, prescription does not run as the action partakes of the nature of a suit for quieting of title, which is imprescriptible. 26
Likewise, an action for reconveyance based on a void contract, as in this controversy where it is alleged that there was no consent on the part of the real owner of the property, the action does not prescribe. 27
It is undisputed that respondent spouses has been in possession of the subject property since it has acquired the same in 1971. Respondent spouses have occupied the property in the concept of an owner, cultivated the same, and rented out a portion of thereof. 28 In fact, they remained in possession of the property when the application of the petitioners for Free Patent over the subject property was granted, when the new TCTs over the same were issued in favor of the petitioners, during the pendency of the complaint before the lower court. 29 Similarly, there is no indication that respondent spouses were deprived of actual possession at all.
In the instant controversy therefore, the one-year prescriptive period within which to file an action for reconveyance does not apply.
Corollarily, there is no basis in the petitioners' contention that having passed all rules and regulations pertinent to the titling by way of free patent application, the same "cannot be questioned by any party in any proceeding in Court."
The rule that a free patent that was fraudulently acquired, and the certificate of title issued pursuant to the same, may only be assailed by the government in an action for reversion pursuant to Section 101 of the Public Land Act is not absolute. A recognized exception thereof is the enforcement of the principle of constructive trust by a private individual through an action for recovenyance, concerning a property the title for which has been secured by another by "unlawfully and in breach of trust." This is because similar to the case of the Torrens Title, the object of the action is not to set aside the decree of registration but only to show that the person who secured the registration of the property is not the real owner thereof. 30 ATICcS
Also, contrary to petitioners' understanding of the RTC's decision, what vested ownership in favor of the respondent spouses is not the fact that laches has already set in. Respondent spouses' right of ownership over the property has been acquired and vested by virtue of the contract of sale they have executed with the Heirs of Isidro Loyola on November 16, 1971.
That petitioners were able to secure a free patent over the subject property and secure titles in their names do not operate to divest the respondent spouses of ownership over the property. It is settled that the act of registration of a piece of land under the Torrens System is not a mode of acquiring ownership, as such it does not create or vest title. As held by this Court in the case of Lorzano v. Tabayag, Jr.: 31
A certificate of title is merely an evidence of ownership or title over the particular property described therein. It cannot be used to protect a usurper from the true owner; nor can it be used as a shield for the commission of fraud; neither does it permit one to enrich himself at the expense of others. Its issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held in trust for another person by the registered owner. 32 (Citation omitted)
From the foregoing therefore, it is clear that the issuance of certificates of title in the name of the petitioners does not foreclose the respondent spouses from filing a petition for reconveyance to recover what has been allegedly mistakenly included in the former's title.
Having so determined, what remains to be resolved is the issue of ownership over the property in question. In this matter, the RTC and the CA both recognized the validity of the notarized Deed of Absolute Sale issued in favor of the respondent spouses over a specific portion of the property. 33
Verily, the issue of ownership and identity of the land is a question of fact that entails the re-evaluation of the probative value of evidence, and as such is beyond the province of a petition for review. More so, where as in this case the CA found no error and affirmed the findings of the RTC. Absent any compelling reason for us to deviate from the foregoing rule, this Court is therefore bound by these factual findings and affirm the ownership of the respondent spouses. 34
WHEREFORE, premises considered, the instant Petition for Review on Certiorari is hereby DENIED. Accordingly, the Decision dated July 10, 2013 and Resolution dated January 21, 2014 of the Court of Appeals in CA-G.R. CV No. 95457 are hereby AFFIRMED.
SO ORDERED."
Very truly yours,
MA. LOURDES C. PERFECTODivision Clerk of Court
By:
(SGD.) TERESITA AQUINO TUAZONDeputy Division Clerk of Court
Footnotes
1.Rollo, pp. 7-17.
2. Penned by Associate Justice Stephen C. Cruz, with Associate Justices Magdangal M. De Leon and Myra V. Garcia-Fernandez, concurring; id. at 20-28.
3.Id. at 29-30.
4. Rendered by Judge Nilo B. Barsaga; id. at 31-40.
5.Id. at 33.
6. Records, p. 13.
7.Rollo, pp. 33-34.
8.Id. at 21, 34.
9.Id. at 34.
10.Id.
11.Id.
12.Id. at 31-40.
13.Id. at 40.
14.Id. at 35.
15.Id. at 40.
16.Id. at 20-28.
17.Id. at 27-28.
18.Id. at 24-29.
19.Id. at 28-30.
20.Id. at 29-30.
21.Id. at 10-11.
22.Id. at 12-15.
23.Hortizuela v. Tagufa, et al., 754 Phil. 499, 507-508 (2015).
24. Article 1456. If property is acquired through mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the person from whom the property comes.
25.Art. 1144. The following actions must be brought within ten years from the time the right of action accrues:
xxx xxx xxx
(2) Upon an obligation created by law;
xxx xxx xxx
26.Uy v. CA, et al., 769 Phil. 705, 719-720 (2015).
27. Id. at 721.
28. Rollo, p. 21.
29. Id. at 36.
30. Lorzano v. Tabayag, Jr., 681 Phil. 39, 54-55 (2012).
31. 681 Phil. 39 (2012).
32. Id. at ___.
33. Rollo, pp. 33, 36.
34. Lamsis, et al. v. Dong-e, 648 Phil. 372, 391 (2010).