G.R. No.

169985 Page 1 of 16

THIRD DIVISION

MODESTO LEOVERAS, G.R. No. 169985

Petitioner,
Present:
CARPIO MORALES, J., Chairperson,
BRION,
- versus - BERSAMIN,
VILLARAMA, JR., and
SERENO, JJ.
Promulgated:
CASIMERO VALDEZ,
Respondent. June 15, 2011
x-------------------------------------------------------------------------------------- x
DECISION
BRION, J.:
[1]
Before the Court is a petition for review on certiorari assailing the March 31,
[2] [3]
2005 decision and the October 6, 2005 resolution of the Court of Appeals (CA) in
[4]
CA-G.R. CV No. 68549. The CA decision reversed the June 23, 2000 decision of
the Regional Trial Court (RTC), Branch 46, Urdaneta City, Pangasinan, dismissing
respondent Casimero Valdezs complaint for annulment of title, reconveyance and
damages against petitioner Modesto Leoveras.

FACTUAL ANTECEDENTS

Maria Sta. Maria and Dominga Manangan were the registered owners - three-
fourths () and one-fourth () pro-indiviso, respectively - of a parcel of land located in
Poblacion, Manaoag, Pangasinan, covered by Original Certificate of Title (OCT) No.
[5]
24695, with an area of 28,171 square meters.

In September 1932, Sta. Maria sold her three-fourths () share to Benigna

[6]
Llamas. The sale was duly annotated at the back of OCT No. 24695. When
[7]
Benigna died in 1944, she willed her three-fourths () share equally to her sisters

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 2 of 16

[8]
Alejandra Llamas and Josefa Llamas. Thus, Alejandra and Josefa each owned one-
half () of Benignas three-fourths () share.

On June 14, 1969, Alejandras heirs sold their predecessors one-half () share
(roughly equivalent to 10,564 square meters) to the respondent, as evidenced by a
[9]
Deed of Absolute Sale.

Also on June 14, 1969, Josefa sold her own one-half () share (subject property)
to the respondent and the petitioner, as evidenced by another Deed of Absolute Sale.
[10] [11]
On even date, the respondent and the petitioner executed an Agreement,
allotting their portions of the subject property.

WITNESSETH

That we [petitioner and respondent] are the absolute owners of [the subject
property] which is particularly described as follows:

xxx

That our ownership over the said portion mentioned above is evidenced by a
Deed of Absolute Sale xxx

That in said deed of sale mentioned in the immediate preceding paragraph,

our respective share consist of 5, 282.13 [one-half of 10,564 square meters] square
meter each.

That we hereby agreed and covenanted that our respective share shall be as
follows:

Modesto Leoveras 3,020 square meters residential portion on the northern

part near the Municipal road of Poblacion Pugaro,
Manaoag, Pangasinan;
[12]
Casimero Valdez 7,544.27 square meters of the parcel of land described
[13]
above.

On June 8, 1977, the petitioner and the respondent executed an Affidavit of Adverse
[14]
Claim over the subject property. The parties took possession of their respective
portions of the subject property and declared it in their name for taxation purposes.
[15]

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 3 of 16

In 1996, the respondent asked the Register of Deeds of Lingayen, Pangasinan

on the requirements for the transfer of title over the portion allotted to him on the
subject property. To his surprise, the respondent learned that the petitioner had
already obtained in his name two transfer certificates of title (TCTs): one, TCT No.
195812 - covering an area of 3,020 square meters; and two, TCT No. 195813 -
covering an area of 1,004 square meters (or a total of 4,024 square meters).

The Register of Deeds informed the respondent that they could not find the
record of OCT No. 24695; instead, the Register of Deeds furnished the respondent
[16]
with the following (collectively, petitioners documents):
1. Two (2) deeds of absolute sale dated June 14, 1969, both executed by
Sta. Maria, purportedly conveying an unspecified portion of OCT No.
24695 as follows:
[17]
a. 11, 568 square meters to the respondent and petitioner
[18]
b. 8, 689 square meters to one Virgilia Li Meneses

2. Deed of Absolute Sale (Benigna Deed) also dated June 14, 1969
[19]
executed by Benigna which reads:
I, Benigna Llamas, Fernandez xxx do sell xxx by way of ABSOLUTE
SALE unto the said Casimero Valdez, Modesto Leoveras and Virgilia
Meneses their heirs and assigns, 7,544 sq.m.; 4,024 sq. m. and 8,689 sq. m.
more or less respectively of a parcel of land which is particularly described as
follows:

A parcel of land xxx covered by [OCT No.] 24695. (Emphases added)

[20]
3. Subdivision Plan of PSU 21864 of OCT No. 24695
[21]
4. Affidavit of Confirmation of Subdivision dated May 3, 1994
(Affidavit), which reads:
That we, Virgilia Li Meneses, xxx Dominga Manangan; Modesto
Leoveras; and Casimero Valdez xxx

xxx are co-owners of a certain parcel of land with an area of 28, 171 sq.
m. more or less in subdivision plan Psu 21864 xxx covered by [OCT No.] 24695
situated at Poblacion (now Pugaro), Manaoag, Pangasinan;

xxx we agree xxx to subdivide and hereby confirmed the subdivision in

the following manner xxx:

Lot 2 with an area of 3, 020 sq. m. xxx to Modesto Leoveras xxx;

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 4 of 16

Lot 3 with an area of 1,004 sq. m. xxx to Modesto Leoveras xxx;

Lot 4 with an area of 7,544 sq. m. xxx to Casimero Valdez xxx;

Lot 5 with an area of 8, 689 sq. m. xxx to Virgilia Meneses;

Lot 6 with an area of 7,043 sq. m. xxx to Dominga Manangan (Emphasis

supplied.)

On June 21, 1996, the respondent filed a complaint for Annulment of Title,
Reconveyance and Damages against the petitioner, seeking the reconveyance of the
1,004-square meter portion (disputed property) covered by TCT No. 195813, on the
ground that the petitioner is entitled only to the 3,020 square meters identified in the
parties Agreement.

The respondent sought the nullification of the petitioners titles by contesting the
authenticity of the petitioners documents. Particularly, the respondent assailed the
Benigna Deed by presenting Benignas death certificate. The respondent argued that
Benigna could not have executed a deed, which purports to convey 4,024 square
meters to the petitioner, in 1969 because Benigna already died in 1944. The
respondent added that neither could Sta. Maria have sold to the parties her three-
fourths () share in 1969 because she had already sold her share to Benigna in 1932.
[22] [23]
The respondent denied his purported signature appearing in the Affidavit,
and prayed for:
a) xxx the cancellation of the [petitioners documents];

b) the cancellation of TCT No. 195813 in the name of Modesto Leoveras and that it
be reconveyed to the [respondent];

c) the cancellation and nullification of [TCT No. 195812] covering an area of 3,020
square meters xxx;

d) [the issuance of] title xxx in the name of [respondent] over an area of 17, 104
[24]
square meters of OCT 24695; (Underscoring supplied)

In his defense, the petitioner claimed that the parties already had (i) delineated
their respective portions of the subject property even before they acquired it in 1969
and (ii) agreed that upon acquisition, each would own the portion as delineated; that
the area he actually possessed and subsequently acquired has a total area of 4,024
square meters, which he subdivided into two portions and caused to be covered by the

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 5 of 16

two TCTs in question. The petitioner claimed that in signing the Agreement, he was
led to believe, based on the parties rough estimation, that the area he actually
possessed is only 3,020 square meters contrary to the parties real intention - i.e., the
[25]
extent of their ownership would be based on their actual possession.

The petitioner further claimed that the respondent voluntarily participated in

executing the Affidavit, which corrected the mistake in the previously executed
[26]
Agreement and confirmed the petitioners ownership over the disputed property.
The petitioner asked for the dismissal of the complaint and for a declaration that he is
the lawful owner of the parcels of land covered by his titles.

RTC RULING

The RTC dismissed the complaint. The court ruled that the respondent failed to
preponderantly prove that the Benigna Deed and the Affidavit are fabricated and,
consequently, no ground exists to nullify the petitioners titles. The court observed that
the respondent did not even compare his genuine signature with the signatures
appearing in these documents.

CA RULING

On appeal, the CA reversed the RTC by ruling against the authenticity of the
Benigna Deed and the Affidavit. The CA gave weight to Benignas death certificate
which shows the impossibility of Benignas execution of the deed in 1969. The CA
also noted the discrepancy between the respondents signatures as appearing in the
[27]
Affidavit, on one hand, and the documents on record, on the other. The CA added
that the respondents failure to compare his genuine signature from his purported
signatures appearing in the petitioners documents is not fatal, since Section 22, Rule
132 of the Rules of Court allows the court to make its own comparison. In light of its
observations, the CA ruled:
As the totality of the evidence presented sufficiently sustains [the respondents] claim
that the titles issued to [the petitioner] were based on forged and spurious documents,
it behooves this Court to annul these certificates of title.

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 6 of 16

WHEREFORE, the assailed Decision dated June 23, 2000 is SET ASIDE.
Declaring TCT No. 195812 and TCT No. 195813 as NULL and VOID, [the
petitioner] is hereby directed to reconvey the subject parcels of land to [the
[28]
respondent]. (Emphasis added.)

Unwilling to accept the CAs reversal of the RTC ruling, the petitioner filed the
present appeal by certiorari, claiming that the CA committed gross misappreciation of
[29]
the facts by going beyond what the respondent sought in his complaint.

THE PETITION

The petitioner claims that the CA should not have ordered the reconveyance of
both parcels of land covered by the TCTs in question since the respondent only seeks
the reconveyance of the disputed property i.e., the parcel of land covered by TCT No.
195813.

The petitioner asserts that after the subject sale, the parties physically
partitioned the subject property and possessed their respective portions, thereby
setting the limits of their ownership.

The petitioner admits that the Benigna Deed is fabricated but hastens to add
that it was only designed (i) to affirm the true intent and agreement of the parties on
the extent of their ownership, as shown by their actual physical possession, and (ii) as
a convenient tool to facilitate the transfer of title to his name.

THE RESPONDENTS COMMENT

The respondent claims that since the petitioner himself admitted using a
spurious document in obtaining his titles (as alleged in the complaint and as found by
[30]
the CA), then the CA correctly cancelled the latters titles.

The petitioner forged the respondents signature in the Affidavit to make it

appear that he agreed to the division indicated in the document. The respondent
defended the CAs reconveyance of both parcels of land, covered by the petitioners

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 7 of 16

titles, to the respondent by arguing that if the distribution in the Affidavit is followed,
the original intendment of the parties on their shares of the subject property would be
[31]
grievously impaired

THE ISSUES

[32]
The two basic issues for our resolution are:

1. Whether the CA erred in nullifying the petitioners titles.

2. Whether the CA erred in ordering the reconveyance of the parcel of land
covered by the petitioners titles.

THE RULING

We partially grant the petition.

An action for reconveyance is a legal and equitable remedy granted to the

rightful landowner, whose land was wrongfully or erroneously registered in the name
[33]
of another, to compel the registered owner to transfer or reconvey the land to him.
The plaintiff in this action must allege and prove his ownership of the land in dispute
and the defendants erroneous, fraudulent or wrongful registration of the property.

We rule that the respondent adequately proved his ownership of the disputed
property by virtue of the (i) Deed of Absolute Sale executed by Josefa in favor of the
parties; (ii) the parties Affidavit of Adverse Claim; and (iii) the parties Agreement,
which cover the subject property.

The petitioner does not dispute the due execution and the authenticity
[34]
of these documents, particularly the Agreement. However, he claims that since
the Agreement does not reflect the true intention of the parties, the Affidavit was
subsequently executed in order to reflect the parties true intention.

The petitioners argument calls to fore the application of the parol evidence rule,
[35]
i.e., when the terms of an agreement are reduced to writing, the written agreement

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 8 of 16

is deemed to contain all the terms agreed upon and no evidence of these terms can be
[36]
admitted other than what is contained in the written agreement. Whatever is not
[37]
found in the writing is understood to have been waived and abandoned.

To avoid the operation of the parol evidence rule, the Rules of Court allows a
party to present evidence modifying, explaining or adding to the terms of the written
agreement if he puts in issue in his pleading, as in this case, the failure of the written
agreement to express the true intent and agreement of the parties. The failure of the
written agreement to express the true intention of the parties is either by reason of
mistake, fraud, inequitable conduct or accident, which nevertheless did not prevent a
[38]
meeting of the minds of the parties.

At the trial, the petitioner attempted to prove, by parol evidence, the alleged
true intention of the parties by presenting the Affidavit, which allegedly corrected the
mistake in the previously executed Agreement and confirmed his ownership of the
parcels of land covered by his titles. It was the petitioners staunch assertion that the
respondent co-executed this Affidavit supposedly to reflect the parties true intention.

In the present petition, however, the petitioner made a damaging admission that
the Benigna Deed is fabricated, thereby completely bolstering the respondents cause
of action for reconveyance of the disputed property on the ground of fraudulent
registration of title. Since the Affidavit merely reflects what is embodied in the
Benigna Deed, the petitioners admission, coupled with the respondents denial of his
purported signature in the Affidavit, placed in serious doubt the reliability of this
document, supposedly the bedrock of the petitioners defense.

Curiously, if the parties truly intended to include in the petitioners share the
disputed property, the petitioner obviously need not go at length of fabricating a deed
of sale to support his application for the transfer of title of his rightful portion of the
subject property. Notably, there is nothing in the Affidavit (that supposedly corrected
the mistake in the earlier Agreement) that supports the petitioners claim that the
partition of the subject property is based on the parties actual possession.

Note that the RTC dismissed the complaint based on the respondents alleged
failure to prove the spuriousness of the documents submitted by the petitioner to the
Register of Deeds. However, by admitting the presentation of a false deed in securing

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 9 of 16

his title, the petitioner rendered moot the issue of authenticity of the Benigna Deed
and relieved the respondent of the burden of proving its falsity as a ground to nullify
the petitioners titles.

By fraudulently causing the transfer of the registration of title over the disputed
property in his name, the petitioner holds the title to this disputed property in trust for
[39]
the benefit of the respondent as the true owner; registration does not vest title but
merely confirms or records title already existing and vested. The Torrens system of
registration cannot be used to protect a usurper from the true owner, nor can it be used
as a shield for the commission of fraud, or to permit one to enrich oneself at the
[40]
expense of others. Hence, the CA correctly ordered the reconveyance of the
disputed property, covered by TCT No. 195813, to the respondent.

The parties Agreement effectively partitioned the

subject property

The petitioner also relies on his alleged actual possession of the disputed
property to support his claim of ownership. Notably, both parties make conflicting
[41]
assertions of possession of the disputed property. The petitioner testified on his
possession as follows:

Q: How many square meters did you get from the land and how many square meters
was the share of [respondent]?
A: 4[0]20 square meters and my brother-in-law 6,000 plus square meters.

xxx

Q: Was there a boundary between the 4,020 square meters and the rest of the property
which (sic) designated by your brother-in-law?

A: There is sir, and the boundary is the fence.

Q: When did you put up that fence which is the boundary?

A: After the deed of sale was made.

Q: And that boundary fence which you put according to you since the execution of
the Deed of Absolute Sale in 1969 up to the present does it still exist?

A: Yes, sir.

Q: Since the time you purchased the property according to you you already divided
the property, is that correct?

A: Yes, sir.

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 10 of 16

Q: And that as of today who is in possession of that 4,020 square meters?

[42]
A: I, sir.

The petitioner and the respondent were originally co-owners of the subject
property when they jointly bought it from the same vendor in 1969. However, the
parties immediately terminated this state of indivision by executing an Agreement,
which is in the nature of a partition agreement.

The Civil Code of the Philippines defines partition as the separation, division
[43]
and assignment of a thing held in common among those to whom it may belong.
Partition is the division between two or more persons of real or personal property,
owned in common, by setting apart their respective interests so that they may enjoy
[44]
and possess these in severalty, resulting in
[45]
the partial or total extinguishment of co-ownership.

In the present case, the parties agreed to divide the subject property by giving
the petitioner the 3,020 square meters residential portion on the northern part near the
[46]
Municipal road. There is no dispute that this 3,020- square meter portion is the
same parcel of land identified as Lot No. 2 (which is not the subject of the
respondents action for reconveyance) in the Affidavit and the Subdivision Plan
presented by the petitioner before the Register of Deeds. The fact that the Agreement
lacks technical description of the parties respective portions or that the subject
property was then still embraced by a single certificate of title could not legally
prevent a partition, where the different portions allotted to each were determined and
[47]
became separately identifiable, as in this case.

What is strikingly significant is that even the petitioners own testimony merely
attempted to confirm his actual possession of the disputed property, without, however,
supporting his claim contrary to the written Agreement that the parties ownership of
the subject property would be co-extensive with their possession. This is the core of
the petitioners defense. At any rate, just as non-possession does not negate ownership,

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 11 of 16

[48]
neither does possession automatically prove ownership, especially in the face of
an unambiguous document executed by the parties themselves.

Contrary to the petitioners claim that his actual possession determines the
extent of his ownership, it is the parties Agreement that defines the extent of their
ownership in the subject property. One of the legal effects of partition, whether by
agreement among the co-owners or by judicial proceeding, is to terminate the co-
ownership and, consequently, to make the previous co-owners the absolute and
[49]
exclusive owner of the share allotted to him.

Parenthetically, the respondent declared for taxation purposes the portion he

[50]
claims in December 1987. The total area (7,544 square meters) of the properties
declared is equivalent to the area allotted to the respondent under the Agreement. On
the other hand, the petitioner declared the 1,004-square meter portion only in
[51]
September 1994, under Tax Declaration No. 9393, despite his claim of exclusive
and adverse possession since 1969.

Nullification of the petitioners title over the 3,020

square meter portion

While the petitioner admitted using a spurious document in securing his titles,
nonetheless, he questions the CAs nullification of TCT No. 195812 on the ground
that, per the respondents own admission and the parties Agreement, he is the rightful
owner of the land covered by this title.

We disagree.

[52]
The petitioners argument confuses registration of title with ownership.
While the petitioners ownership over the land covered by TCT No. 195812 is
undisputed, his ownership only gave him the right to apply for the proper transfer of
title to the property in his name. Obviously, the petitioner, even as a rightful owner,
must comply with the statutory provisions on the transfer of registered title to lands.
[53]
Section 53 of Presidential Decree No. 1529 provides that the subsequent

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018
G.R. No. 169985 Page 12 of 16

registration of title procured by the presentation of a forged deed or other instrument

is null and void. Thus, the subsequent issuance of TCT No. 195812 gave the
petitioner no better right than the tainted registration which was the basis for the
issuance of the same title. The Court simply cannot allow the petitioners attempt to
get around the proper procedure for registering the transfer of title in his name by
using spurious documents.

Reconveyance is the remedy of the rightful

owner only

While the CA correctly nullified the petitioners certificates of title, the CA

erred in ordering the reconveyance of the entire subject property in the respondents
favor. The respondent himself admitted that the 3,020- square meter portion covered
[54]
by TCT No. 195812 is the petitioners just share in the subject property. Thus,
although the petitioner obtained TCT No. 195812 using the same spurious documents,
the land covered by this title should not be reconveyed in favor of the respondent
[55]
since he is not the rightful owner of the property covered by this title.

WHEREFORE, the petition is partially GRANTED. The assailed decision

and resolution of the Court of Appeals are MODIFIED. Accordingly, the petitioner is
directed to RECONVEY to the respondent the parcel of land covered by TCT No.
195813. Costs against petitioner.

SO ORDERED.

ARTURO D. BRION
Associate Justice

WE CONCUR:

CONCHITA CARPIO MORALES

Associate Justice

LUCAS P. BERSAMIN MARTIN S. VILLARAMA, JR.

http://sc.judiciary.gov.ph/jurisprudence/2011/june2011/169985.htm 7/11/2018