FIRST DIVISION

G. R. No. 156888 November 20, 2006

PEDRO R. SANTIAGO, Petitioner,

DECISION

CHICO-NAZARIO, J.:

The Case

For Review under Rule 45 of the Rules of Court, as amended, is the 3 December 20021 and 7 January
20032 Orders of the Regional Trial Court (RTC) of Olongapo City, Zambales, Branch 74, in Civil Case
No. 126-0-2002 entitled Victoria M. Rodriguez, Pedro R. Santiago and Armando G. Mateo versus
Subic Bay Metropolitan Authority. In the assailed Orders, the RTC denied the application for the
issuance of writ of preliminary injunction and dismissed the complaint for lack of cause of action.

The Facts

This case stemmed from a Complaint3 for Recovery of Possession of Property, filed by Victoria M.
Rodriguez, Armando G. Mateo and herein petitioner Pedro R. Santiago against respondent Subic Bay
Metropolitan Authority (SBMA) on 12 March 2002, before the RTC of Olongapo City, Zambales,
Branch 74. Included in said complaint was a prayer for the issuance of a Writ of Preliminary Injunction
and/or Temporary Restraining Order.

In their Complaint filed before the RTC, Victoria M. Rodriguez, Armando G. Mateo and petitioner Pedro
R. Santiago, alleged that:

Plaintiff (Victoria M. Rodriguez) is the sole heir and administrator of the estate of Hermogenes
Rodriguez by virtue of the Order, dated February, 1994 in Spec. Proc. No. IR-1110, "In the Matter of
the Settlement of the Estate of Hermogenes Rodriguez y Reyes, etc.", (sic) of Branch 34 of the
Regional Trial Court at Iriga City x x x.

xxxx

In his lifetime, the late Hermogenes Rodriguez y Reyes was the owner of parcels of land registered in
his name under that (sic) certificate of title denominated as a Titulo de Propriedad de Terrenos of 1891
Royal Decree No. 01-4-Protocol x x x.
xxxx

On January 31, 2002, plaintiff Victoria M. Rodriguez, in her capacity as heir and administrator of the
estate of Hermogenes Rodriguez, leased to Pedro R. Santiago and Armando G. Mateo, for a period
of 50 years, two parcels of land of Hermogenes Rodriguez covered by his aforesaid title, x x x.

xxxx

By virtue of the aforesaid lease contract, plaintiff Pedro R. Santiago is presently occupying the
aforesaid parcel of land consisting of 2.5 hectares, more particularly the improvements located at 717
Sta. Rita Road.

Despite the fact that defendant is not the owner of the two aforesaid parcels of land leased to plaintiffs
Santiago and Mateo, defendant is claiming possessory, if not proprietary, rights over them. More
particularly, defendant is using these two parcels of land for its (sic) own commercial and other
purposes.

It is now the desire of plaintiff Victoria Rodriguez to recover possession of the property from the
defendant so that she could comply with her contractual commitments to her co-plaintiffs.

xxxx

[D]efendant is claiming possessory, if not proprietary, rights over the parcels of land described in
paragraph 7 hereof. Lately, plaintiff Pedro R. Santiago was informed by purported agents or
employees of the defendant that he should vacate the premises he and his family are occupying since
defendant would be needing the same for its own use. Defendant has no authority to do this since it
is not the owner of the premises, and the owner, Victoria Rodriguez (sic) has already leased the
premises to plaintiffs Santiago and Mateo.4

Respondent SBMA, in its counter statement of facts,5 contends that sometime in 1998, Liwanag
Santiago, wife of herein petitioner Pedro R. Santiago, by virtue of her employment with respondent
SBMA, availed herself of the housing privilege accorded to the latter’s employees; that due to said
privilege, she was allowed to lease a housing unit6 inside the Subic Bay Freeport Zone; that the lease
agreement, however, "shall be terminated if the lessees are no longer employed with SBMA;"7 that on
31 January 2002, Liwanag Santiago’s employment contract concluded; that since said contract was
not renewed, Liwanag Santiago ceased to be an employee of respondent SBMA; and that as a
consequence thereof, as mandated by the SBMA Housing Policy, she and her family were asked 8 to
vacate and return possession of the subject housing unit.

On 13 March 2002, the RTC issued a Temporary Restraining Order[9] against respondent SBMA from
ousting petitioner Santiago and his family from the premises of the subject housing unit within seventy
two (72) hours from receipt. Further, it was likewise restrained and enjoined from committing any other
acts that would prevent the latter and his family from occupying the premises they have allegedly
leased from Victoria Rodriguez.

Thereafter, the RTC conducted hearings on the application for the issuance of a Writ of Preliminary
Injunction.

On 5 April 2002, instead of filing an Answer, respondent SBMA filed a Motion to Dismiss10 the
abovementioned complaint on the argument, inter alia,11 that the latter failed to state a valid cause of
action.
On 3 December 2002, the RTC issued its first assailed order. In denying and dismissing the application
for the issuance of a Writ of Preliminary Injunction and complaint respectively, the RTC stated that
since the alleged right of complainant Rodriguez stemmed from a Spanish Title, specifically the Titulo
de Propriedad de Terrenos of 1891, it cannot be considered a right in esse. The RTC took judicial
notice of Presidential Decree No. 892,12 which required all holders of Spanish titles or grants to apply
for registration of their lands under Republic Act No. 496, otherwise known as the Land Registration
Act,13 within six months from effectivity of the decree, or until 16 August 1976. After such time, Spanish
titles or grants could no longer be used as evidence of land ownership in any registration proceedings
under the Torrens System. Significant parts of the assailed Order of the RTC read:

Plaintiffs’ complaint is anchored on a Spanish title which they claim is still a valid, subsisting and
enforceable title. Despite the fact that said title was never registered under Act 496, the land
Registration Act (later PD 1529), plaintiffs still claim that they have a cause of action.

The court is not convinced.

The action filed by plaintiffs is for recovery of possession based on the ownership by plaintiff Rodriguez
of the disputed property evidenced by a Spanish title. Clearly, by the sheer force of law particularly the
enabling clauses of PD 892, said type of title can no longer be utilized as evidence of ownership.
Verily, Spanish titles can no longer be countenanced as indubitable evidence of land ownership.
(Citation omitted.)

As such and on its face, the complaint indeed failed to state a cause of action simply because the
court can take judicial notice of the applicability of PD 892 and of the pertinent decisions of the
Supreme Court to the case at bench.14

Therein plaintiffs filed a Motion for Reconsideration which was denied in the second assailed Order
dated 7 January 2003.

The Issues

Hence, petitioner Santiago’s immediate resort to this Court by way of a petition for review
on certiorari under Rule 45 of the Rules of Court, as amended, raising the following issues:15

I.

WHETHER OR NOT SPANISH TITLES ARE STILL ADMISSIBLE AS EVIDENCE OF

II.

WHETHER OR NOT THE DISMISSAL OF THE COMPLAINT WAS PROPER IN VIEW OF

III.

WHETHER OR NOT DEFENDANT, BY FILING A MOTION TO DISMISS INSTEAD OF AN

The Court’s Ruling

As the appeal of respondent Santiago involves only questions of law, the Court took cognizance of the
instant petition.16

Petitioner Santiago maintains that "x x x P.D. No. 892 merely disallowed the use of Spanish titles as
evidence of land ownership in any registration proceedings under the Torrens system. In other words,
Spanish titles can still be used as evidence of land ownership in any other proceedings except
registration under the Torrens system. Since the instant case is not one for registration under the
Torrens system, but x x x who should be entitled to the possession thereof, then the presentation as
evidence of land ownership of the Spanish title in question is permissible." As to the non-presentation
of the Titulo de Propriedad de Terrenos, petitioner Santiago had this to say:

As the trial court stated, "(F)undamental is the rule that a defendant moving to dismiss a complaint for
lack of cause of action is regarded as having admitted all the allegations thereof, at least
hypothetically". (sic) The Complaint specifically alleged that plaintiff Victoria Rodriguez was the great-
great-great granddaughter of and the sole heir and administrator of the late spouses Hermogenes
Rodriguez and Erlinda Flores and that in his lifetime Hermogenes Rodriguez was the owner of parcels
of land registered in his name under that certificate of title denominated as a Titulo de Propriedad de
Terrenos of 1891 Royal Decree No. 01-4-Protocol. Defendant was, therefore, deemed to have
admitted these allegations. And, with such admissions, then there would be no more need, at least at
this stage of the case, for the plaintiffs to present the Spanish title. In other words, the inadmissibility
of the title, as argued by the defendant, becomes immaterial since there is no more need to present
this title in view of the admissions."

Citing the case of Intestate Estate of the Late Don Mariano San Pedro y Esteban v. Court of Appeals,
et al.,[17]respondent SBMA, however, stresses that "Spanish titles can no longer be countenance as
indubitable evidence of land ownership by sheer force of law, particularly, the enabling clause of P.D.
892 in expressly providing that, if not accompanied by actual possession of the land, said type of title
x x x can no longer be utilized as proof or evidence of ownership x x x."

A priori, before the Court goes into the resolution of the fundamental issue raised by the instant petition,
a critical matter must be dealt with – the fact that the assailed orders of dismissal of the complaint and
denial of the motion for reconsideration, respectively, of the RTC had already become final and
executory against Victoria M. Rodriguez due to her failure to appeal the case. It must be remembered
that petitioner Santiago is merely the alleged lessee of part of the claimed parcel of land. In the scheme
of things, so to speak, his right to recover possession is anchored on the alleged ownership of Victoria
M. Rodriguez, which right to the claimed parcel of land is not in esse. As such, petitioner Santiago is
equally bound by the final and executory order of the RTC dismissing the complaint for lack of cause
of action.

Nevertheless, even if we were to overlook the foregoing grievous error, we would be hard pressed to
find fault in the assailed orders of the RTC. The present petition is substantially infirm as this Court
had already expressed in the case of Nemencio C. Evangelista, et al. v. Carmelino M. Santiago,18 that
the Spanish title of Don Hermogenes Rodriguez, the Titulo de Propriedad de Torrenos of 1891, has
been divested of any evidentiary value to establish ownership over real property.
Victoria M. Rodriguez, Armando G. Mateo and petitioner Pedro R. Santiago anchor their right to
recover possession of the subject real property on claim of ownership by Victoria M. Rodriguez being
the sole heir of the named grantee, Hermogenes Rodriguez, in the Spanish title Titulo de Propriedad
de Torrenos. Promulgated on 29 April 2005, in the aforementioned Evangelista Case, we categorically
stated that:

P.D. No. 892 became effective on 16 February 1976. The successors of Don Hermogenes Rodriguez
had only until 14 August 1976 to apply for a Torrens title in their name covering the Subject Property.
In the absence of an allegation in petitioners’ Complaint that petitioners’ predecessors-in-interest
complied with P.D. No. 892, then it could be assumed that they failed to do so. Since they failed to
comply with P.D. No. 892, then the successors of Don Hermogenes Rodriguez were already enjoined
from presenting the Spanish title as proof of their ownership of the Subject Property in registration
proceedings.

Registration proceedings under the Torrens system do not create or vest title, but only confirm and
record title already created and vested. (Citation omitted.) By virtue of P.D. No. 892, the courts, in
registration proceedings under the Torrens system, are precluded from accepting, confirming and
recording a Spanish title. Reason therefore dictates that courts, likewise, are prevented from accepting
and indirectly confirming such Spanish title in some other form of action brought before them
(i.e., removal of cloud on or quieting of title), only short of ordering its recording or registration. To rule
otherwise would open the doors to the circumvention of P.D. No. 892, and give rise to the existence
of land titles, recognized and affirmed by the courts, but would never be recorded under the Torrens
system of registration. This would definitely undermine the Torrens system and cause confusion and
instability in property ownership that P.D. No. 892 intended to eliminate.

Petitioners argued that the Spanish title may still be presented as proof of ownership on the basis of
the exception provided in the fourth whereas clause of P.D. No. 892, which reads:

WHEREAS, Spanish titles to lands which have not yet been brought under the operation of the Torrens
system, being subject to prescription, are now ineffective to prove ownership unless accompanied by
proof of actual possession; . . .

Since Petitioners alleged that they were in actual possession of the Subject Property, then they could
still present the Spanish title as evidence of their ownership of the Subject Property. (Citation omitted.)

This Court cannot sustain petitioners’ argument. Actual proof of possession only becomes necessary
because, as the same whereas clause points out, Spanish titles are subject to prescription. A holder
of a Spanish title may still lose his ownership of the real property to the occupant who actually
possesses the same for the required prescriptive period. (Citation omitted.) Because of this inherent
weakness of a Spanish title, the applicant for registration of his Spanish title under the Torrens system
must also submit proof that he is in actual possession of the real property, so as to discount the
possibility that someone else has acquired a better title to the same property by virtue of prescription.

Moreover, legislative intent must be ascertained from a consideration of the statute as a whole, and
not just a particular provision alone. A word or phrase taken in the abstract may easily convey a
meaning quite different from the one actually intended and evident when the word or phrase is
considered with those with which it is associated. An apparently general provision may have a limited
application if read together with other provisions of the statute. (Citation omitted.)

The fourth whereas clause of P.D. No. 892 should be interpreted and harmonized with the other
provisions of the whole statute. (Citation omitted.) Note that the tenor of the whole presidential decree
is to discontinue the use of Spanish titles and to strip them of any probative value as evidence of
ownership. It had clearly set a deadline for the filing of applications for registration of all Spanish titles
under the Torrens system (i.e., six months from its effectivity or on 14 August 1976), after which, the
Spanish titles may no longer be presented to prove ownership.

All holders of Spanish titles should have filed applications for registration of their title on or before 14
August 1976. In a land registration proceeding, the applicant should present to the court his Spanish
title plus proof of actual possession of the real property. However, if such land registration proceeding
was filed and initiated after 14 August 1976, the applicant could no longer present his Spanish title to
the court to evidence his ownership of the real property, regardless of whether the real property was
in his actual possession.

Therefore, the fact that petitioners were in actual possession of the Subject Property when they filed
the Complaint with the trial court on 29 April 1996 does not exclude them from the application of P.D.
No. 892, and their Spanish title remain inadmissible as evidence of their ownership of the Subject
Property, whether in a land registration proceeding or in an action to remove a cloud on or to quiet
title.

The preceding discussion does not bar holders of Spanish titles from claiming ownership of the real
property on some other basis, such as those provided in either the Land Registration Decree (Citation
omitted.) or the Public Land Act.42Petitioners though failed to allege any other basis for their titles in
their Complaint aside from possession of the Subject Property from time immemorial, which this Court
has already controverted; and the Spanish title, which is already ineffective to prove ownership over
the Subject Property.

Therefore, without legal or equitable title to the Subject Property, the petitioners lacked the personality
to file an action for removal of a cloud on, or quieting of, title and their Complaint was properly
dismissed for failing to state a cause of action. In view of the dismissal of the case on this ground, it is
already unnecessary for this Court to address the issue of prescription of the action.19

Prescinding from the foregoing, the instant petition must be denied by virtue of the principle of stare
decisis. Not only are the legal rights and relations of herein parties substantially the same as those
passed upon in the aforementioned 2005 Evangelista Case, but the facts, the applicable laws, the
issues, and the testimonial and documentary evidence are identical such that a ruling in one case,
under the principle of stare decisis, is a bar to any attempt to relitigate the same issue.

The principle of stare decisis et non quieta movere (to adhere to precedents and not to unsettle things
which are established) is well entrenched in Article 8 of the Civil Code, to wit:

ART. 8. Judicial decisions applying or interpreting the laws or the Constitution shall form a part of the
legal system of the Philippines.

With the above provision of law and preceding discussions, in tandem with the Court’s
pronouncements in numerous cases, i.e., Director of Forestry v. Muñoz;20 Antonio v.
Barroga;21 Republic v. Court of Appeals.;22 National Power Corporation v. Court of Appeals;23 Carabot
v. Court of Appeals;24 Republic v. Intermediate Appellate Court;25Widows and Orphans Association,
Inc. v. Court of Appeals;26 Director of Lands v. Heirs of Isabel Tesalona;27 and Intestate Estate of Don
Mariano San Pedro y Esteban v. Court of Appeals,28 it is quite evident that the RTC committed no
reversible error in taking heed of our final, and executory, decisions – those decisions considered to
have attained the status of judicial precedents in so far as the use of Spanish titles to evidence
ownership are concerned. For it is the better practice that when a court has laid down a principle of
law as applicable to a certain state of facts, it will adhere to that principle and apply it to all future cases
where the facts are substantially the same.29 1âwphi 1
The doctrine of stare decisis embodies the legal maxim that a principle or rule of law which has been
established by the decision of a court of controlling jurisdiction will be followed in other cases involving
a similar situation. It is founded on the necessity for securing certainty and stability in the law and does
not require identity of or privity of parties.30 This is unmistakable from the wordings of Article 8 of the
Civil Code. It is even said that such decisions "assume the same authority as the statute itself and,
until authoritatively abandoned, necessarily become, to the extent that they are applicable, the criteria
which must control the actuations not only of those called upon to decide thereby but also of those in
duty bound to enforce obedience thereto."31 Abandonment thereof must be based only on strong and
compelling reasons, otherwise, the becoming virtue of predictability which is expected from this Court
would be immeasurably affected and the public’s confidence in the stability of the solemn
pronouncements diminished.32

It has long been settled that by virtue of Presidential Decree No. 892 which took effect on 16 February
1976, the system of registration under the Spanish Mortgage Law was abolished and all holders of
Spanish titles or grants should cause their lands covered thereby to be registered under the Land
Registration Act (Act No. 496) within six months from the date of effectivity of the said Decree or until
16 August 1976.33 If not, non-compliance therewith will result in a reclassification of the real property.

In the case at bar, we have no alternative but to uphold the ruling that Spanish titles can no longer be
countenanced as indubitable evidence of land ownership.34 And, without legal or equitable title to the
subject property, Victoria M. Rodriguez, Armando G. Mateo and petitioner Pedro R. Santiago lacked
the personality to claim entitlement to possession of the same. Title to real property refers to that upon
which ownership is based. It is the evidence of the right of the owner or the extent of his interest, by
which means he can maintain control and, as a rule, assert right to exclusive possession and
enjoyment of the property.35

Therefore, the RTC correctly dismissed the complaint for lack of cause of action.

Anent the argument of petitioner Santiago that by filing the Motion to Dismiss, respondent SBMA
already admitted all the allegations of the complaint such that the question of whether or not the subject
Spanish Title was inadmissible or not had become immaterial.

We do not agree.

Basic is the rule that in a motion to dismiss complaint based on lack of cause of action, the question
posed to the court for determination is the sufficiency of the allegation of facts made in the complaint
to constitute a cause of action. It is beside the point whether or not the allegations in the complaint are
true, for with said motion, the movant only hypothetically admits the truth of the facts alleged in the
complaint, that is, assuming arguendo that the facts alleged are true, the facts alleged are insufficient
for the court to render a valid judgment upon the same in accordance with the prayer of the complaint.

Consequently, by anchoring their right to recover possession of property on the subject Spanish title
that has been divested of any legal force and effect in establishing ownership over the subject real
property, the complaint filed by Victoria M. Rodriguez, Armando G. Mateo and petitioner Pedro R.
Santiago was correctly dismissed by the RTC for lack of cause of action.

In fine, there is nothing more left to be argued as regards the Spanish title of Don Hermogenes
Rodriguez. The issue has been settled and this Court’s final decision in the said cases must be
respected.36 This Court’s hands are now tied by the finality of the abovementioned decisions. The
Court has no alternative but to deny the instant petition.
WHEREFORE, premises considered, the instant petition is hereby DENIED. The assailed 3 December
200237 and 7 January 200338 Orders of the Regional Trial Court (RTC) of Olongapo City, Zambales,
Branch 74, in Civil Case No. 126-0-2002, are hereby AFFIRMED. Cost against the petitioner.

SO ORDERED.