CIVIL LAW BAR EXAM ANSWERS: LAND

TRANSFER AND DEEDS

Published by adminC on May 8, 2013 | Leave a response

Acquisition of Lands; Citizenship Requirement (2003)

In 1970, the spouses Juan and Juana de la Cruz, then Filipinos, bought the parcel
of unregistered land in the Philippines on which they built a house which became their
residence. In 1986, they migrated to Canada and became Canadian citizens.

Thereafter, in 1990, they applied, opposed by the Republic, for the registration of the
aforesaid land in their names. Should the application of the spouses de la Cruz be
granted over the Republic’s opposition? Why?

SUGGESTED ANSWER:

Yes, the application should be granted. As a rule, the Constitution prohibits aliens from
owning private lands in the Philippines. This rule, however, does not apply to the
spouses Juan and Juana de la Cruz because at the time they
acquired ownership over the land, albeit imperfect, they were still Filipino citizens.
The application for registration is
a mere confirmation of the imperfect title which the spouses have already acquired
before they became Canadian citizens. (Republic v. CA, 235 SCRA 567 [1994]).

Adverse Claims; Notice of Levy (1998)

Section 70 of Presidential Decree No. 1529, concerning adverse claims on registered

land, provides a 30-day period of effectivity of an adverse claim, counted from the date
of its registration. Suppose a notice of adverse claim based upon a contract to sell was
registered on March 1, 1997 at the instance of the BUYER, but on June 1, 1997, or after
the lapse of the 30-day period, a notice of levy on execution in favor of a JUDGMENT
CREDITOR was also registered to enforce a final judgment for money against the
registered owner. Then, on June 15, 1997 there having been no formal cancellation of his
notice of adverse claim, the BUYER pays to the seller-owner the agreed purchase price
in full and registers the corresponding deed of sale. Because the annotation of the
notice of levy is carried over to the new title in his name, the BUYER brings an action
against the JUDGMENT CREDITOR to cancel such annotation, but
the latter claims that his lien is superior because it was annotated after the adverse
claim of the BUYER had ipso facto ceased to be effective. Will the suit prosper?

SUGGESTED ANSWER:

The suit will prosper. While an adverse claim duly annotated at the back of a title under
Section 7O of P.D. 1529 is good only for 30 days, cancellation thereof is still necessary to
render it ineffective, otherwise, the inscription thereof will remain annotated as a lien on
the property. While the life of adverse claim is 3O days under P.D. 1529, it continuous to
be effective until it is canceled by formal petition filed with the Register of Deeds.

The cancellation of the notice of levy is justified under Section 108 of P.D. 1529
considering that the levy on execution can not be enforced against the buyer whose
adverse claim against the registered owner was recorded ahead of the notice of levy on
execution.

Annotation of Lis Pendens; When Proper (2001)

Mario sold his house and lot to Carmen for P1 million payable in five (5) equal annual
installments. The sale was registered and title was issued in Carmen’s name. Carmen
failed to pay the last three installments and Mario filed an. action for collection,
damages and attorneys fees against her. Upon filing of the complaint, he caused a notice
of lis pendens to be annotated on Carmen’s title. Is the notice of lis pendens proper or
not? Why?

SUGGESTED ANSWER:

The notice of lis pendens is not proper for the reason that the case filed by Mario against
Carmen is only for collection, damages, and attorney’s fees.

Annotation of a lis pendens can only be done in cases

involving recovery of possession of real property, or to quiet title or to remove cloud
thereon, or for partition or any other proceeding affecting title to the land or the use or
occupation thereof. The action filed by Mario does not fall on anyone of these.

Foreshore Lands (2000)

Regina has been leasing foreshore land from the Bureau of

Fisheries and Aquatic Resources for the past 15 years. Recently, she learned that
Jorge was able to obtain a free patent from the Bureau of Agriculture, covering the same
land, on the basis of a certification by the District Forester
that the same is already “alienable and disposable”. Moreover, Jorge had already
registered the patent with the Register of Deeds of the province, and he was issued an
Original Certificate of Title for the same. Regina filed an action for annulment of Jorge’s
title on the ground that it was obtained fraudulently. Will the action prosper?

SUGGESTED ANSWER:

An action for the annulment of Jorge’s Original Certificate of Title will prosper on the
following grounds:

(1) Under Chapter IX of C .A, No. 141, otherwise known as the Public Land Act,
foreshore lands are disposable for residential, commercial, industrial, or similar
productive purposes, and only by lease when not needed by the government for public
service.

(2) If the land is suited or actually used for fishpond or aquaculture purposes, it comes
under the Jurisdiction of the Bureau of Fisheries and Aquatic Resources (BFAR) and
can only be acquired by lease (P.D. 705).

(3) Free Patent is a mode of concession under Section 41, Chapter VII of the Public
Land Act, which is applicable only for agricultural lands.

(4) The certificate of the district forester that the land is already “alienable and
disposable” simply means that the land is no longer needed for forest purposes, but the
Bureau of Lands could no longer dispose of it by free patent because it is already
covered by a lease contract between BFAR and Regina. That contract must be respected.

(5) The free patent of Jorge is highly irregular and void ab

initio, not only because the Bureau has no statutory authority to issue a free patent
over a foreshore area, but also because of the false statements made in his sworn
application that he has occupied and cultivated the land since July 4, 1945, as required
by the free patent law. Under Section 91 of the Public Land Act, any patent concession or
title obtained thru false representation is void ab initio. In cases of this nature, it is the
government that shall institute annulment proceedings considering that the suit carries
with it a prayer for the reversion of the land to the state. However, Regina is a
party in interest and the case will prosper because she has a lease contract for the same
land with the government.

Forgery; Innocent Purchaser; Holder in Bad Faith (2005)

Rod, the owner of an FX taxi, found in his vehicle an envelope containing TCT No.
65432 over a lot registered in Cesar’s name. Posing as Cesar, Rod forged Cesar’s
signature on a Deed of Sale in Rod’s favor. Rod registered the said document with the
Register of Deeds, and obtained a new title in his name. After a year, he sold the lot to
Don, a buyer in good faith and for value, who also registered the lot in his name.

a) Did Rod acquire title to the land? Explain.

SUGGESTED ANSWER:

No, Rod did not acquire title to the land. The inscription in the registry, to be effective,
must be made in good faith. The defense of indefeasibility of a Torrens Title does not
extend to a transferee who takes the certificate of title with notice of a flaw. A holder in
bad faith of a certificate of title is not entitled to the protection of the law, for the law
cannot be used as a shield for
frauds. (Samonte v. Court of Appeals, G.R. No. 104223, July 12, 2001)
In the case at bar, Rod only forged Cesar’s signature on
the Deed of Sale. It is very apparent that there was bad faith on the part of Rod from the
very beginning. As such, he is not entitled to the protection of the Land Registration Act.

b) Discuss the rights of Don, if any, over the property.

SUGGESTED ANSWER:

It is a well-known rule in this jurisdiction that persons dealing with registered land
have the legal right to rely on the face of the Torrens Certificate of Title and to dispense
with the need to inquire further, except when the party concerned has actual knowledge
of facts and circumstances that would impel a reasonably cautious man to make such
inquiry (Naawan Community Rural Bank v. Court of Appeals, G.R. No.
128573, January 13, 2003).

In the given problem, the property was already registered in the name of Rod when he
bought the same from the latter. Thus, Don could be considered as a buyer in good faith
and for value. However, since Rod did not actually sell any property to him, Don has no
right to retain ownership over the property. He has only the right to recover the
purchase price plus damages.

Forgery; Innocent Purchaser; Mirror Principle (1991)

Bruce is the registered owner, of a parcel of land with a building thereon and is in
peaceful possession thereof. He pays the real estate taxes and collects the rentals
therefrom. Later, Catalino, the only brother of Bruce, filed a petition
where he, misrepresenting to be the attorney-in-fact of Bruce and falsely alleging
that the certificate of title was lost, succeeded in obtaining a second owner’s duplicate
copy of the title and then had the same transferred in his name through a simulated
deed of sale in his favor. Catalino then mortgaged the property to Desiderio who had the
mortgage annotated on the title. Upon learning of the fraudulent transaction, Bruce filed
a complaint against Catalino and Desiderio to have the title of Catalino and the
mortgage in favor of Desiderio declared null and void.

Will the complaint prosper, or will the title of Catalino and the mortgage to Desiderio be
sustained?

SUGGESTED ANSWER:

The complaint for the annulment of Catalino’s Title will prosper. In the first place, the
second owner’s copy of the title secured by him from the Land Registration Court is void
ab initio, the owner’s copy thereof having never been lost, let alone the fact that said
second owner’s copy of the title was fraudulently procured and improvidently issued by
the Court. In the second place, the Transfer Certificate of Title procured by Catalino is
equally null and void, it having been issued on the basis of a simulated or forged Deed of
Sale. A forged deed is an absolute nullity and conveys no title.
The mortgage in favor of Desiderio is likewise null and void because the mortgagor is
not the owner of the mortgaged
property. While it may be true that under the “Mirror Principle” of the Torrens S
ystem of Land Registration, a buyer or mortgagee has the right to rely on what
appears on the Certificate of Title, and in the absence of anything to excite suspicion, is
under no obligation to look beyond the
certificate and investigate the mortgagor’s title, this rule does not find application in
the case at hand because here. Catalino’s title suffers from two fatal infirmities, namely:

a) The fact that it emanated from a forged deed of a simulated sale;

b) The fact that it was derived from a fraudulently procured or improvidently

issued second owner’s copy, the real owner’s copy being still intact and in the possession
of the true owner, Bruce.

The mortgage to Desiderio should be cancelled without prejudice to his right to go after
Catalino and/or the government for compensation from the assurance fund.

Fraud; Procurement of Patent; Effect (2000)

In 1979, Nestor applied for and was granted a Free Patent over a parcel of agricultural
land with an area of 30 hectares,
located in General Santos City. He presented the Free
Patent to the Register of Deeds, and he was issued a corresponding Original
Certificate of Title (OCT) No. 375, Subsequently, Nestor sold the land to Eddie. The deed
of sale was submitted to the Register of Deeds and on the basis thereof, OCT No, 375
was cancelled and Transfer Certificate of Title (TCT) No. 4576 was issued in the name of
Eddie. In 1986, the Director of Lands filed a complaint for annulment of OCT No, 375
and TCT No. 4576 on the ground that Nestor obtained the Free Patent through fraud.
Eddie filed a motion to dismiss on the ground that he was an innocent purchaser for
value and in good faith and as such, he has acquired a title to the property which is valid,
unassailable and indefeasible. Decide the motion.

SUGGESTED ANSWER:

The motion of Nestor to dismiss the complaint for annulment of O.C.T. No. 375 and
T.C.T. No. 4576 should be denied for the following reasons:

1) Eddie cannot claim protection as an innocent purchaser for value nor can he
interpose the defense of indefeasibility of his title, because his TCT is rooted on a void
title. Under Section 91 of CA No. 141, as amended, otherwise known as the Public Land
Act, statements of material facts in the applications for public land must be under
oath. Section 91 of the same act provides that such statements shall be considered as
essential conditions and parts of the concession, title,
or permit issued, any false statement therein, or omission of facts shall ipso facto
produce the cancellation of the concession. The patent issued to Nestor in this case is
void ab initio not only because it was obtained by fraud but also because it covers 30
hectares which is far beyond the maximum of 24 hectares provided by the free patent
law.

2) The government can seek annulment of the original and transfer certificates of title
and the reversion of the land to the state. Eddie’s defense is untenable. The
protection afforded by the Torrens System to an innocent purchaser for value can be
availed of only if the land has been titled thru judicial proceedings where the issue of
fraud becomes academic after the lapse of one (1) year from the issuance of the decree of
registration. In public land grants, the action of the government to annul a title
fraudulently obtained does not prescribe such action and will not be barred by the
transfer of the title to an innocent purchaser for value.

Homestead Patents; Void Sale (1999)

In 1950, the Bureau of Lands issued a Homestead patent to A. Three years later, A sold
the homestead to B. A died in 1990, and his heirs filed an action to recover
the homestead from B on the ground that its sale by their father to the latter is void
under Section 118 of the Public Land Law. B contends, however, that the heirs of A
cannot recover the homestead from him anymore because their action has prescribed
and that furthermore, A was in pari delicto. Decide.

SUGGESTED ANSWER:

The sale of the land by A to B 3 years after issuance of the homestead patent, being in
violation of Section 118 of the Public Land Act, is void from its inception.

The action filed by the heirs of B to declare the nullity or inexistence of the contract and
to recover the land should be given due course.

B’s defense of prescription is untenable because an action

which seeks to declare the nullity or inexistence of A contract does not
prescribe. (Article 1410; Banaga vs. Soler, 28 SCRA 765)

On the other hand, B’s defense of pari delicto is equally untenable. While as a rule,
parties who are in pari delicto have no recourse against each other on the principle that
a transgressor cannot profit from his own wrongdoing, such
rule does not apply to violations of Section 118 of the Public Land Act because of
the underlying public policy in the said Act
“to conserve the land which a homesteader has acquired by gratuitous grant from the
government for himself and his family”. In keeping with this policy, it has been held that
one who purchases a homestead within the five-year prohibitory period can only recover
the price which he has paid by filing a claim against the estate of the deceased
seller (Labrador vs. Delos Santos 66 Phil. 579) under the principle that no one
shall enrich himself at the expense of another. Applying the pari delicto ruleto violation
of Section 118 of the Public Land Act, the Court of Appeals has ruled that “the
homesteader suffers the loss of the fruits realized by the vendee who in turn forfeits the
improvement that he has introduced into the land.” (Obot vs. Sandadi
Uas, 69 OG,April 35,1966}

FIRST ALTERNATIVE ANSWER:

The action to declare the nullity of the sale did not prescribe (Art. 1410}, such sale being
one expressly prohibited and declared void by the Public Lands Act [Art. 1409, par. (7)].
The prohibition of the law is clearly for the protection of the heirs of A such that their
recovering the property would enhance the public policy regarding ownership of lands
acquired by homestead patent (Art. 1416). The defense of
pari delicto is not applicable either, since the law itself allows the homesteader to
reacquire the land even if it has been sold.

SECOND ALTERNATIVE ANSWER:

Prescription does not arise with respect to actions to declare

a void contract a nullity (Article 1410). Neither is the doctrine of pari delicto
applicable because of public policy. The law is designed for the protection of the plaintiff
so as to enhance the public policy of the Public Land Act to give land to the landless.

If the heirs are not allowed to recover, it could be on the ground of laches inasmuch as
40 years had elapsed and the owner had not brought any action against B especially if
the latter had improved the land. It would be detrimental to B if the plaintiff is allowed
to recover.

Innocent Purchaser for Value (2001)

Cesar bought a residential condominium unit from High Rise Co. and paid the price in
full. He moved into the unit, but somehow he was not given the Condominium
Certificate of Title covering the property. Unknown to him, High Rise Co. subsequently
mortgaged the entire condominium building to Metrobank as security for a loan of P500
million. High Rise Co. failed to pay the loan and the bank foreclosed the mortgage. At
the foreclosure sale, the bank acquired the building, being the highest bidder. When
Cesar learned about this, he filed an action to annul the foreclosure sale insofar as his
unit was concerned. The bank put up the defense that it relied on the condominium
certificates of title presented by High Rise Co., which were clean. Hence, it was a
mortgagee and buyer in good faith. Is this defense tenable or not? Why?

SUGGESTED ANSWER:

Metrobank’s defense is untenable. As a rule, an innocent purchaser for value acquires a

good and a clean title to the property. However, it is settled that one who closes his eyes
to facts that should put a reasonable man on guard is not an innocent purchaser for
value. In the present problem the bank is expected, as a matter of standard operating
procedure, to have conducted an ocular inspection, of the promises before granting any
loan. Apparently, Metrobank did not follow this procedure. Otherwise, it should have
discovered that the condominium unit in question was occupied by Cesar and that fact
should have led it to make further inquiry. Under the circumstances, Metrobank cannot
be considered a mortgagee and buyer in good faith.

Mirror Principle (1990)

In 1950’s, the Government acquired a big landed estate in Central Luzon from the
registered owner for subdivision into small farms and redistribution of bonafide
occupants, F was a former lessee of a parcel of land, five hectares in area. After
completion of the resurvey and subdivision, F applied to buy the said land in accordance
with the guidelines of the implementing agency. Upon full payment of the price
in 1957, the corresponding deed of absolute sale was executed in his favor and was
registered, and in 1961, a new title was issued in his name. In 1963, F sold the said land
to X; and in 1965 X sold it to Y, new titles were successively issued in the names of the
said purchasers.

In 1977, C filed an action to annul the deeds of sale to F, X and Y and their titles, on the
ground that he (C) had been in actual physical possession of the land, and that the sale
to F and the subsequent sales should be set aside on the ground of fraud. Upon motion
of defendants, the trial court dismissed the complaint, upholding their defenses of their
being innocent purchasers for value, prescription and laches. Plaintiff appealed.

(a) Is the said appeal meritorious? Explain your answer

(b) Suppose the government agency concerned joined C in filing the said action against
the defendants, would that change the result of the litigation? Explain.

SUGGESTED ANSWER:

(a) The appeal is not meritorious. The trial court ruled correctly in granting defendant’s
motion to dismiss for the following reasons:

1. While there is the possibility that F, a former lessee of the

land was aware of the fact that C was the bona fide occupant thereof and for this
reason his transfer certificate of title may be vulnerable, the transfer of the same land
and the issuance of new TCTs to X and Y who are innocent purchasers for value render
the latter’s titles indefeasible. A person dealing with registered land may safely rely on
the correctness of the certificate of title and the law will not in any way oblige him to go
behind the certificate to determine
the condition of the property in search for any hidden defect or inchoate right
which may later invalidate or diminish the right to the land. This is the mirror principle
of the Torrens System of land registration.

2. The action to annul the sale was instituted in 1977 or more than (10) years from the
date of execution thereof in 1957, hence, it has long prescribed.

3. Under Sec 45 of Act 496, “the entry of a certificate of title shall be regarded as an
agreement running with the land, and binding upon the applicant and all his successors
in title that the land shall be and always remain registered land. A title under Act 496 is
indefeasible and to preserve that character, the title is cleansed anew with every transfer
for value (De Jesus v. City of Manila; 29 Phil. 73; Laperal v. City of Manila, 62
Phil. 313; Penullar v. PNB, 120 SCRA 111).

SUGGESTED ANSWER:

(b) Even if the government joins C, this will not alter the outcome of the case so much
because of estoppel as an express provision in Sec 45 of Act 496 and Sec 31 of PD 1529
that a decree of registration and the certificate of title issued in pursuance thereof “shall
be conclusive upon and against all persons, including the national government and all
branches thereof, whether mentioned by name in the application or not.”

Mirror Principle; Forgery; Innocent Purchaser (1999)

The spouses X and Y mortgaged a piece of registered land to A, delivering as well the
OCT to the latter, but they continued to possess and cultivate the land, giving 1/2 of each
harvest to A in partial payment of their loan to the
latter, A, however, without the knowledge of X and Y,
forged a deed of sale of the aforesaid land in favor of himself, got a TCT in his
name, and then sold the land to B, who bought the land relying on A’s title, and who
thereafter also got a TCT in his name. It was only then that the spouses X and Y
learned that their land had been titled in B’s name. May said spouses file an action for
reconveyance of the land in question against b? Reason.

SUGGESTED ANSWER:

The action of X and Y against B for reconveyance of the land will not prosper because B
has acquired a clean title to the property being an innocent purchaser for value.

A forged deed is an absolute nullity and conveys no title. The fact that the forged deed
was registered and a certificate of title was issued in his name, did not operate to vest
upon an ownership over the property of X and Y. The registration of the forged
deed will not cure the infirmity. However, once the title to the land is registered in the
name of the forger and title to the land thereafter falls into the hands of an innocent
purchaser for value, the latter acquires a clean title thereto. A buyer of a registered land
is not required to explore beyond what the record in the registry indicates on its face in
quest for any hidden defect or inchoate right which may subsequently defeat his right
thereto. This is the “mirror principle‘ of the Torrens system which makes it
possible for a forged deed to be the root of a good title.

Besides, it appears that spouses X and Y are guilty of contributory negligence when they
delivered this OCT to the mortgagee without annotating the mortgage thereon.
Between them and the innocent purchaser for value, they should bear the loss.

ALTERNATIVE ANSWER:
If the buyer B, who relied on the teller A’s title, was not aware of the adverse possession
of the land by the spouses X and Y, then the latter cannot recover the property from B. B
has in his favor the presumption of good faith which can only be overthrown by
adequate proof of bad faith. However, nobody buys land without seeing the property,
hence, B could not have been unaware of such adverse possession. If after learning of
such possession, B simply closed his eyes and did nothing about it, then the suit for
reconveyance will prosper as the buyer’s bad faith will have become evident.

Notice of Lis Pendens (1995)

Rommel was issued a certificate of title over a parcel of land in Quezon City. One year
later Rachelle, the legitimate owner of the land, discovered the fraudulent registration
obtained by Rommel. She filed a complaint against Rommel for reconveyance and
caused the annotation of a notice of lis pendens on the certificate of title issued to
Rommel. Rommel now invokes the indefeasibility of his title considering that one year
has already elapsed from its issuance. He also seeks the cancellation of the notice of Lis
pendens.

May the court cancel the notice of lis pendens even before final judgment is rendered?
Explain.

SUGGESTED ANSWER:

A Notice of Lis Pendens may be cancelled even before final judgment upon proper
showing that the notice is for the purpose of molesting or harassing the adverse
party or that the notice of lis pendens is not necessary to protect the right of the party
who caused it to be registered. (Section 77, P.D. No. 1529)

In this case, it is given that Rachelle is the legitimate owner of the land in question. It
can be said, therefore, that when
she filed her notice of lis pendens her purpose was to protect her interest in the
land and not just to molest Rommel. It is necessary to record the Lis pendens to
protect her interest because if she did not do it, there is a
possibility that the land will fall into the hands of an innocent purchaser for value
and in that event, the court loses control over the land making any favorable judgment
thereon moot and academic. For these reasons, the notice of lis pendens may not be
canceled.

Notice of Lis Pendens; Transferee Pendente Lite (2002)

Sancho and Pacifico are co-owners of a parcel of land. Sancho sold the property to
Bart. Pacifico sued Sancho and Bart for annulment of the sale and reconveyance of
the property based on the fact that the sale included his one- half pro-indiviso share.
Pacifico had a notice of lis pendens annotated on the title covering the property and
ordered the cancellation of the notice of lis pendens. The notice of lis pendens could not
be cancelled immediately because the
title over the property was with a bank to which the property had been mortgaged
by Bart. Pacifico appealed the case. While the appeal was pending and with the notice of
lis pendens still uncancelled, Bart sold the property to
Carlos, who immediately caused the cancellation of the notice of lis pendens, as well
as the issuance of a new title in his name.

Is Carlos (a) a purchaser in good faith, or (b) a transferee pendente lite? If your answer
is (a), how can the right of Pacifico as co-owner be protected? Explain.

SUGGESTED ANSWER:

A. Carlos is a buyer in bad faith. The notice of lis pendens was still annotated at the
back of the title at the time he bought the land from Bart. The uncancelled notice of lis
pendens operates as constructive notice of its contents as well as interests, legal or
equitable, included therein. All persons are charged with the knowledge of what it
contains. In an earlier case, it was held that a notice of an adverse claim remains
effective and binding notwithstanding the lapse of the 30 days from its inscription in the
registry. This ruling is even more applicable in a lis pendens.

Carlos is a transferee pendente lite insofar as Sancho’s share in the co-ownership in the
land is concerned because the land was transferred to him during the pendency of the
appeal.

B. Pacifico can protect his right as a co-owner by pursuing his appeal; asking the Court
of Appeals to order the re-annotation of the lis pendens on the title of Carlos; and by
invoking his right of redemption of Bart’s share under Articles 1620 of the New Civil
Code.

ALTERNATIVE ANSWER:

A. Carlos is a purchaser in good faith. A possessor in good faith has been defined as
“one who is unaware that there exists a flaw which invalidates his acquisition of the
thing” (Art. 526, NCC). Good faith consists in the possessor’s belief that the person from
whom he received the thing was the owner of the same and could convey his title. In the
case [at bar], in question, while Carlos bought the subject property from Bart while a
notice of lis pendens was still annotated thereon, there was also an existing court order
canceling the same. Hence, Carlos cannot be
considered as being “aware of a flaw which invalidates [their] the acquisition of the
thing” since the alleged flaw, the notice of lis pendens, was already being ordered
cancelled at the time of the purchase. On this ground alone, Carlos can already be
considered a buyer in good
faith. (PoLam v. Court of Appeals, 347 SCRA 86, [2000]).

B. To protect his right over the subject property, Pacifico should have timely filed an
action for reconveyance and reinstated the notice of lis pendens.

Prescription &Laches; Elements of Laches (2000)

In an action brought to collect a sum of money based on a surety agreement, the defense
of laches was raised as the claim was filed more than seven years from the maturity
of the obligation. However, the action was brought within the ten-year prescriptive
period provided by law wherein actions based on written contracts can be instituted.

a) Will the defense prosper? Reason.

b) What are the essential elements of laches?

SUGGESTED ANSWER:

No, the defense will not prosper. The problem did not give facts from which laches may
be inferred. Mere delay in filing an action, standing alone, does not constitute
laches (Agra v. PNB, 309 SCRA 509).

SUGGESTED ANSWER:

b) The four basic elements of laches are; (1) conduct on the part of the defendant or of
one under whom he claims, giving rise to the situation of which complainant seeks a
remedy; (2) delay in asserting the complainant’s rights, the complainant having had
knowledge or notice of the defendant’s conduct and having been afforded an
opportunity to institute suit; (3) lack of knowledge on the part of the defendant that the
complainant would assert the right on which he bases his suit; and (4) injury or
prejudice to the defendant in the event relief is accorded to the complainant, or the suit
is not held to be barred.

Prescription & Laches; Indefeasibility Rule of Torrens Title (2002)

Way back in 1948, Winda’s husband sold in favor of Verde Sports Center Corp. (Verd
e) a 10-hectare property belonging to their conjugal partnership. The sale was made
without Winda’s knowledge, much less consent. In 1950, Winda learned of the sale,
when she discovered the deed of sale among the documents in her husband’s vault after
his demise. Soon after, she noticed that the construction of the sports complex had
started. Upon completion of the construction in 1952, she tried but failed to get free
membership privileges in Verde.

Winda now files a suit against Verde for the annulment of the sale on the ground that
she did not consent to the sale. In answer, Verde contends that, in accordance with the
Spanish Civil Code which was then in force, the sale in 1948 of the property did not need
her concurrence. Verde contends that in any case the action has prescribed or is barred
by laches. Winda rejoins that her Torrens title covering the property is indefeasible, and
imprescriptible.

A. Define or explain the term “laches”.

B. Decide the case, stating your reasons for your decision.

SUGGESTED ANSWER:

A. LACHES means failure or neglect, for an unreasonable and unexplained

length of time, to do what, by exercising due diligence, could or should have been done
earlier. It is negligence or omission to assert a right within a reasonable
time. (De Vera v. CA, 305 SCRA 624 [1999])

B. While Article 1413 of the Spanish Civil Code did not require the consent of the wife
for the validity of the sale, an alienation by the husband in fraud of the wife is void as
held in Uy Coque v. Navas, 45 Phil. 430 (1923). Assuming that the alienation in
1948 was in fraud of Winda and, therefore, makes the sale to Verde void, the action to
set aside the sale, nonetheless, is already barred by prescription and laches.
More than 52 years have already elapsed from her discovery of the sale in 1950.

ALTERNATIVE ANSWER:

B. Winda’s claim that her Torrens Title covering the property is indefeasible and
imprescriptible [does not hold water] is not tenable. The
rule of indefeasibility of a Torrens Title means that after one year from the date of issue
of the decree of registration or if the land has fallen into the hands of an innocent
purchaser for value, the title becomes incontestable and incontrovertible.

IMPRESCRIPTIBILITY, on the other hand, means that no title to the land in derogation
of that of the registered owner may be acquired by adverse possession or acquisitive
prescription or that the registered owner does not lose by extinctive prescription his
right to recover ownership and possession of the land.

The action in this case is for annulment of the sale executed

by the husband over a conjugal partnership property covered by a Torrens
Title. Action on contracts are subject to prescription.

Prescription (1990)

In 1960, an unregistered parcel of land was mortgaged by owner O to M, a family friend,

as collateral for a loan. O acted through his attorney-in-fact, son S, who was duly
authorized by way of a special power of attorney, wherein O declared that he was the
absolute owner of the land, that the tax declarations/receipts were all issued in his
name, and that he has been in open, continuous and adverse possession in the
concept of owner.

As O was unable to pay back the loan plus interest for the past five [5) years, M had to
foreclose the mortgage. At the foreclosure sale, M was the highest bidder. Upon issuance
of the sheriff’s final deed of sale and registration in January, 1966, the mortgage
property was turned over to M’s possession and control M has since then developed the
said property. In 1967, O died, survived by sons S and P.
In 1977, after the tenth (10th) death anniversary of his father O. son P filed a suit to
annul the mortgage deed and
subsequent sale of the property, etc., on the ground of
fraud. He asserted that the property in question was conjugal in nature actually
belonging, at the time of the mortgage, to O and his wife, W, whose conjugal share went
to their sons (S and P) and to O.

(a) Is the suit filed by P barred by prescription? Explain your answer.

(b) After the issuance of the sheriff’s final deed of sale in 1966 in this case, assuming that
M applied for registration under the Torrens System and was issued a Torrens Title to
the said property in question, would that added fact have any significant effect on your
conclusion? State your reason.

SUGGESTED ANSWER:

(a) Under Art. 173 of the Civil Code, the action is barred by prescription because the wife
had only ten (10) years from the transaction and during the marriage to file a suit for the
annulment of the mortgage deed.

Alternative Answers to (a) first Alternative Answer:

(a) The mortgage contract executed by O, if at all, is only a voidable contract since it
involves a conjugal partnership property. The action to annul the same instituted in
1977, or eleven years after the execution of the sheriff’s final sale, has obviously
prescribed because:

1) An action to annul a contract on the ground of fraud must be brought within four (4)
years from the date of discovery of the fraud. Since this is in essence an action to recover
ownership, it must be reckoned from the
date of execution of the contract or from the registration of the alleged
fraudulent document with the assessor’s office for the purpose of transferring the tax
declaration, this being unregistered land, (Baelu
v. Intermediate Appellate Court G.R. L-74423, Jan. 30, 1989, 169 SCRA 617).

2) If the action is to be treated as an action to recover ownership of land, it would have

prescribed just the same because more than 10 years have already elapsed since the date
of the execution of the sale.

SECOND ALTERNATIVE ANSWER:

(a) The action to recover has been barred by acquisitive prescription in favor of M
considering that M has possessed the land under a claim of ownership for ten (10) years
with a just title.

(b) If M had secured a Torrens Title to the land, all the more S and P could not recover
because if at all their remedies would be:
1. A Petition to Review the Decree of Registration. This can be availed of within one (1)
year from-the entry thereof, but only upon the basis of “actual fraud.” There is no
showing that M committed actual fraud in securing his title to the land; or

2. An action in personam against M for the reconveyance of the title in their favor.
Again, this remedy is available within four years from the date of the discovery of the
fraud but not later than ten (10) years from the date of registration of the title in the
name of M.

Prescription; Real Rights (1992)

A owned a parcel of unregistered land located on the Tarlac side of the boundary
between Tarlac and Pangasinan. His brother B owned the adjoining parcel of
unregistered land on the Pangasinan side.

A sold the Tarlac parcel to X in a deed of sale executed as a public instrument by A and
X. After X paid in full the, price of the sale, X took possession of the Pangasinan parcel
in the belief that it was the Tarlac parcel covered by the deed of sale executed by A and
X.

After twelve (12) years, a controversy arose between B and X on the issue of the
ownership of the Pangasinan parcel, B
claims a vested right of ownership over the Pangasinan parcel because B never sold
that parcel to X or to anyone else.

On the other hand, X claims a vested right of ownership over the Pangasinan parcel by
acquisitive prescription, because X possessed this parcel for over ten (10] years
under claim of ownership.

Decide on these claims, giving your reasons.

SUGGESTED ANSWER:

At this point in time, X cannot claim the right of vested ownership over the Pangasinan
parcel by acquisitive prescription. In addition to the requisites common to
ordinary and extraordinary acquisitive prescription consisting of uninterrupted,
peaceful, public, adverse and actual possession in the concept of owner, ordinary
acquisitive prescription for ten (10) years requires (1) possession in good faith and (2)
just title. “Just title” means that the adverse claimant came into possession of the
property through one of the modes recognized by law for the acquisition of ownership
but the grantor was not the owner or could not transmit any right (Art. 1129. Civil
Code). In this case, there is no “just title” and no “mode” that can be invoked by X for
the acquisition of the Pangasinan parcel. There was no constructive delivery of the
Pangasinan parcel because it was not the subject-matter of the deed of sale. Hence, B
retains ownership of the Pangasinan parcel of land.

Primary Entry Book; Acquisitive Prescription; Laches (1998)

In 1965, Renren bought from Robyn a parcel of registered land evidenced by a duly
executed deed of sale. The owner presented the deed of sale and the owner’s certificate
of title to the Register of Deeds. The entry was made in the daybook and
corresponding fees were paid as evidenced by official receipt. However, no transfer of
certificate of title was issued to Renren because the original certificate of title in Robyn’s
name was temporarily misplaced after fire partly gutted the Office of the Register of
Deeds. Meanwhile, the land had been possessed by Robyn’s distant cousin,
Mikaelo, openly, adversely and continuously in the concept of owner since 1960. It was
only in April 1998 that Renren sued Mikaelo to recover possession. Mikaelo invoked a)
acquisitive prescription and b) laches, asking that he be declared owner of the land.
Decide the case by evaluating these defenses.

SUGGESTED ANSWER:

a) Renren’s action to recover possession of the land will prosper. In 1965, after
buying the land from Robyn, he submitted the Deed of Sale to the Registry of Deeds for
registration together with the owner’s duplicate copy of the title, and paid the
corresponding registration fees. Under Section 56 of PD No. 1529, the Deed of Sale to
Renren is considered registered from the time the sale was entered in the Day Book
(now called the Primary Entry Book).

For all legal intents and purposes, Renren is considered the registered owner of the
land. After all, it was not his fault that the Registry of Deeds could not issue the
corresponding transfer certificate of title.

Mikaelo’s defense of prescription can not be sustained. A Torrens title is imprescriptible.

No title to registered land in derogation of the title of the registered owner shall be
acquired by prescription or adverse possession. (Section 47, P.D. No, 1529)

The right to recover possession of registered land likewise does not prescribe because
possession is just a necessary incident of ownership.

SUGGESTED ANSWER:

b) Mikaelo’s defense of laches, however, appears to be more sustainable. Renren bought

the land and had the sale registered way back in 1965. From the facts, it appears that it
was only in 1998 or after an inexplicable delay of 33 years that he took the first step
asserting his right to the land. It was not even an action to recover ownership but only
possession of the land. By ordinary standards, 33 years of neglect or inaction is too long
and maybe considered unreasonable. As often held by the Supreme Court, the principle
of imprescriptibility sometimes has to yield to the equitable principle of laches which
can convert even a registered land owner’s claim into a stale demand.

Mikaelo’s claim of laches, however, is weak insofar as the element of equity is

concerned, there being no showing in the facts how he entered into the ownership and
possession of the land.
Reclamation of Foreshore Lands; Limitations (2000)

Republic Act 1899 authorizes municipalities and chartered

cities to reclaim foreshore lands bordering them and to construct thereon adequate
docking and harbor facilities. Pursuant thereto, the City of Cavite entered into an
agreement with the Fil-Estate Realty Company, authorizing
the latter to reclaim 300 hectares of land from the sea bordering the city, with 30%
of the land to be reclaimed to be owned by Fil-Estate as compensation for its services.
The Solicitor General questioned the validity of the agreement on the ground
that it will mean reclaiming land under the sea which is beyond the commerce of man.
The City replies that this is authorized by RA. 1899 because it authorizes the
construction of docks and harbors. Who is correct?

SUGGESTED ANSWER:

The Solicitor General is correct. The authority of the City of

Cavite under RA 1899 to reclaim land is limited to foreshore lands. The Act did not
authorize it to reclaim land from the sea. “The reclamation being unauthorized, the City
of Cavite did not acquire ownership over the reclaimed land. Not being the owner, it
could not have conveyed any portion thereof to the contractor.

ALTERNATIVE ANSWER:

It depends. If the reclamation of the land from the sea is necessary in the construction of
the docks and the harbors, the City of Cavite is correct. Otherwise, it is not. Since
RA 1899 authorized the city to construct docks and harbors, all works that are necessary
for such construction are deemed authorized. Including the reclamation of land from
the sea. The reclamation being authorized, the city is the owner of the reclaimed land
and it may convey a portion thereof as payment for the services of the contractor.

ANOTHER ALTERNATIVE ANSWER:

On the assumption that the reclamation contract was entered into before RA 1899
was repealed by PD 3-A, the City of Cavite is correct. Lands under the sea are “beyond
the commerce of man” in the sense that they are not
susceptible of private appropriation, ownership or alienation. The contract in
question merely calls for the reclamation of 300 hectares of land within the coastal
waters of the city. Per se, it does not vest, alienate or transfer ownership of land
under the sea. The city merely engaged the services of Fil-Estate to reclaim the land for
the city.

Registration; Deed of Mortgage (1994)

How do you register now a deed of mortgage of a parcel of land originally registered
under the Spanish Mortgage Law?

SUGGESTED ANSWER:
a) After the Spanish Mortgage Law was abrogated by
P.D. 892 on February 16, 1976, all lands covered by Spanish titles that were not brought
under the Torrens system within six (6)
months from the date thereof have been considered as “unregistered private lands.”

Thus, a deed of mortgage affecting land originally registered under the Spanish
Mortgage Law is now governed by the
system of registration of transactions or instruments affecting unregistered land
under Section 194 of the Revised Administrative Code as amended by Act No. 3344.
Under this law, the instrument or transaction affecting unregistered land is entered in a
book provided for the purpose but the
registration thereof is purely voluntary and does not adversely affect third persons
who have a better right.

b) By recording and registering with the Register of Deeds of the place where the land is
located, in accordance with Act 3344. However, P.D. 892 required holders of Spanish
title to bring the same under the Torrens System within 6 months from its effectivity on
February 16, 1976.

Remedies; Judicial Confirmation; Imperfect Title (1993)

On June 30, 1986, A filed in the RTC of Abra an application for registration of title
to a parcel of land under P. D. No. 1529, claiming that since June 12, 1945, he has
been in open, continuous, exclusive and notorious possession and occupation of
said parcel of land of the public domain which was alienable and disposable, under a
bona fide claim of ownership. After issuance of the notice of initial hearing and
publication, as required by law, the petition was heard on July 29, 1987. On the day of
the hearing nobody but the applicant appeared. Neither was there anyone who opposed
the application. Thereupon, on motion of the applicant, the RTC issued an order of
general default and allowed the applicant to present his evidence. That he did. On
September 30, 1989, the RTC dismissed A’s application for lack of sufficient evidence. A
appealed to the Court of Appeals.

The appellant urged that the RTC erred in dismissing his application for registration and
in not ordering registration of his title to the parcel of land in question despite the fact
that there was no opposition filed by anybody to his application.

Did the RTC commit the error attributed to it?

SUGGESTED ANSWER:

No, the RTC did not commit the error attributed to it. In an application for Judicial
confirmation of imperfect or incomplete title to public agricultural land under Section
48 of the Public Land Act, the lack of opposition and the
consequent order of default against those who did not answer or show up on the
date of initial hearing, does not guarantee the success of the application. It is still
incumbent upon the applicant to prove with well nigh incontrovertible evidence that he
has acquired a title to the land that is fit for registration. Absent such registrable title, it
is the clear duty of the Land Registration Court to dismiss the application and declare
the land as public land.

An application for land registration is a proceeding in rem.

Its main objective is to establish the status of the res whether it is still part of our
public domain as presumed under the Regalian doctrine or has acquired the character of
a private property. It is the duty of the applicant to overcome that presumption
with sufficient evidence.

Remedies; Judicial Reconstitution of Title (1996)

In 1989, the heirs of Gavino, who died on August 10, 1987, filed a petition for
reconstitution of his lost or destroyed Torrens Title to a parcel of land in Ermita, Manila.
This was opposed by Marilou who claimed ownership of the said land by a series of
sales. She claimed that Gavino had sold the property to Bernardo way back in 1941 and
as evidence thereof, she presented a Tax Declaration in 1948 in the name of Bernardo,
which cancelled the previous Tax Declaration in the name of Gavino. Then she
presented two deeds of sale duly registered with the Register of Deeds, the first one
executed by Bernardo in 1954 selling the same property to Carlos, and the second one
executed by Carlos in 1963, selling the same property to her. She also claimed that she
and her predecessors in interest have been in possession of the property since 1948.

If you were the judge, how will you decide the petition? Explain.

SUGGESTED ANSWER:

If I were the judge, I will give due course to the petition of the heirs of Gavino despite
the opposition of Marilou for the following reasons:

a) Judicial reconstitution of a certificate of title under

RA. No. 26 partakes of a land registration proceeding and is perforce a proceeding in
rem. It denotes restoration of an existing instrument which has been lost or destroyed in
its original form and condition. The purpose of reconstitution of title or any document is
to have the same reproduced, after proceedings. In the same form they were when the
loss or destruction occurred.

b) If the Court goes beyond that purpose, it acts without or in excess of jurisdiction.
Thus, where the Torrens Title sought to be reconstituted is in the name of Gavino, the
court cannot receive evidence proving that Marilou is the owner of the land. Marilou’s
dominical claim to the land should be ventilated in a separate civil action before the
Regional Trial Court in its capacity as a court of general jurisdiction.

REFERENCES: Heirs of Pedro Pinate vs. Dulay, 187 SCRA 12-

20 (1990); Bunagan vs. CF1 Cebu Branch VI, 97 SCRA 72 (1980); Republic
vs. IAC, 157 SCRA 62, 66 (1988); Margolles vs. CA, 230 SCRA 709; Republic
vs. Feliciano, 148 SCRA 924.
Remedies; Procedure; Consulta (1994)

What is the procedure of consult a when an instrument is denied registration?

SUGGESTED ANSWER:

1) The Register of Deeds shall notify the interested party in writing, setting forth the
defects of the instrument or the legal ground relied upon for denying the
registration, and advising that if he is not agreeable to
such ruling, he may, without withdrawing the documents from the Registry,
elevate the matter by Consulta to the Administrator of the Land Registration Authority
(LRA).

2) Within five {5) days from receipt of notice of denial, the party-in-
interest shall file his Consulta with the Register of Deeds concerned and pay the cons
ulta fee.

3) After receipt of the Consulta and payment of the corresponding fee the Register of
Deeds makes an annotation of the pending consulta at the back of the certificate of title.

4) The Register of Deeds then elevates the case to the LRA Administrator with certified
records thereof and a summary of the facts and issues involved.

5) The LRA Administrator then conducts hearings after due notice or may just require
parties to submit their memoranda.

6) After hearing, the LRA Administrator issues an order prescribing the step to be
taken or the memorandum to be made. His resolution in consulta shall be conclusive
and binding upon all Registers of Deeds unless reversed on appeal by the Court of
Appeals or by the Supreme Court. (Section 117, P.D. 1529).

• The procedure of consulta is a mode of appeal from denial by the Register of Deeds
of the registration of the instrument to the Commissioner of Land Registration.

• Within five days from receipt of the notice of denial, the interested party may
elevate the matter by consulta to the Commissioner of Land Registration who shall enter
an order prescribing the step to be taken or memorandum to be made. Resolution in
consulta shall be binding upon all Registers of Deeds provided that the party in interest
may appeal to the Court of Appeals within the period prescribed (Sec. 117, P.D. 1529).

Remedies; Reconveyance vs. Reopening of a Decree; Prescriptive Period

(2003)

Louie, before leaving the country to train as a chef in a five- star hotel in New York,
U.S.A., entrusted to his first-degree cousin Dewey an application for
registration, under the Land Registration Act, of a parcel of land located in
Bacolod City. A year later, Louie returned to the Philippines and discovered that Dewey
registered the land and obtained an Original Certificate of Title over the property in his
Dewey’s name. Compounding the matter, Dewey sold the land to Huey, an innocent
purchaser for value. Louie promptly filed an action for reconveyance of the parcel of
land against Huey.

(a) Is the action pursued by Louie the proper remedy?

(b) Assuming that reconveyance is the proper remedy, will the action prosper if the
case was filed beyond one year, but within ten years, from the entry of the decree of
registration?

SUGGESTED ANSWER:

(a) An action for reconveyance against Huey is not the proper remedy, because Huey is
an innocent purchaser for value. The proper recourse is for Louie to go after Dewey
for damages by reason of the fraudulent registration
and subsequent sale of the land. If Dewey is insolvent, Louie may file a claim
against the Assurance
Fund (Heirs of Pedro Lopez v. De Castro 324 SCRA 591 [2000] citing Sps.
Eduarte v. CA, 323 Phil 462, 467 [1996]).

(b) Yes, the remedy will prosper because the action prescribes in ten (10) years, not
within one (1) year when a petition for the reopening of the registration decree may be
filed. The action for reconveyance is distinct from the petition to reopen the decree of
registration (Grey Alba v. De la Cruz, 17 Phil. 49 [1910}). There is no need to reopen the
registration proceedings, but the property should just be reconveyed to the real owner.

The action for reconveyance is based on implied or constructive trust, which prescribes
in ten (10) years from the date of issuance of the original certificate of title. This rule
assumes that the defendant is in possession of the land. Where it is the plaintiff who is
in possession of the land, the action for reconveyance would be in the nature of a suit for
quieting for the title which action is
imprescriptible (David v. Malay, 318 SCRA 711 [1999]).

Remedies; Reconveyance; Elements (1995)

Rommel was issued a certificate of title over a parcel of land in Quezon City. One year
later, Rachelle, the legitimate owner of the land, discovered the fraudulent registration
obtained by Rommel. She filed a complaint against Rommel for reconveyance and
caused the annotation of a notice of lis pendens on the certificate of title issued to
Rommel. Rommel now invokes the indefeasibility of his title considering that one year
has already elapsed from its issuance. He also seeks the cancellation of the notice of Lis
pendens.

Will Rachelle’s suit for reconveyance prosper? Explain.

SUGGESTED ANSWER:
Yes, Rachelle’s suit will prosper because all elements for an action for reconveyance are
present, namely:

a) Rachelle is claiming dominical rights over the same land.

b) Rommel procured his title to the land by fraud.

c) The action was brought within the statutory period of four (4) years from discovery
of the fraud and not later than ten (10} years from the date of registration of Rommel’s
title.

d) Title to the land has not passed into the hands of an innocent purchaser for value.

Rommel can invoke the indefeasibility of his title if Rachelle had filed a petition to
reopen or review the decree of registration. But Rachelle instead filed an ordinary action
in personam for reconveyance. In the latter action, indefeasibility is not a valid defense
because, in filing such action, Rachelle is not seeking to nullify nor to impugn the
indefeasibility of Rommel’s title. She is only asking the court to compel Rommel to
reconvey the title to her as the legitimate owner of the land.

ALTERNATIVE ANSWER:

Yes. The property registered is deemed to be held in trust for the real owner by the
person in whose name it is registered. The Torrens system was not designed to shield
one who had committed fraud or misrepresentation and thus holds the title in bad
faith. (Walstrom v. Mapa Jr.,(G.R 38387, 29 Jan. 1990) as cited in Martinez,
D., Summary of SC Decisions, January to June,1990,p.359].

Remedies; Reconveyance; Prescriptive Period (1997)

On 10 September 1965, Melvin applied for a free patent covering two lots – Lot A and
Lot B – situated in Santiago, Isabela. Upon certification by the Public Land Inspector
that Melvin had been in actual, continuous, open, notorious, exclusive and adverse
possession of the lots since 1925, the Director of Land approved Melvin’s application on
04 June 1967. On 26 December 1967, Original Certificate of Title (OCT) No. P-2277 was
issued in the name of Melvln.

On 7 September 1971, Percival filed a protest alleging

that Lot B which he had been occupying and cultivating since 1947 was included in the
Free Patent issued in the name of Melvin. The Director of Lands ordered the
investigation of Percival’s protest. The Special Investigator who conducted the
investigation found that Percival had been in actual cultivation of Lot B since 1947.

On 28 November 1986, the Solicitor General filed in behalf of the Republic of the
Philippines a complaint for cancellation of the free patent and the OCT issued in the
name of Melvin and the reversion of the land to public domain on the ground of fraud
and misrepresentation in obtaining the free patent. On the same date, Percival sued
Martin for the reconveyance of Lot B.

Melvin filed his answers interposing the sole defense in both cases that the
Certificate of Title issued in his name became incontrovertible and indefeasible upon the
lapse of one year from the issuance of the free patent.

Given the circumstances, can the action of the Solicitor General and the case for
reconveyance filed by Percival possibly prosper?

SUGGESTED ANSWER:

“If fraud be discovered in the application which led to the issuance of the patent and
Certificate of Title, this Title becomes ipso facto null and void. Thus, in a case where a
person who obtained a free patent, knowingly made a false statement of material and
essential facts in his application for the same, by stating therein that the lot in question
was part of the public domain not occupied or claimed by any other person, his title
becomes ipso facto canceled and consequently rendered null and void.”

“It is to the public interest that one who succeeds In fraudulently acquiring title to
public land should not be allowed to benefit therefrom and the State, through the
Solicitor General, may file the corresponding action for annulment of the patent and the
reversion of the land involved to the public domain” (Dinero
vs. Director of Lands; Kayaban vs. Republic L-33307, 8-20-
73; Director of Lands vs. Hon. Pedro Samson Animas, L-37682,3-29-74).

This action does not prescribe. With respect to Percival’s action for reconveyance, it
would have prescribed, having been filed more than ten (10) years after registration and
issuance of an O.C.T. in the name of Melvin, were it not for the inherent infirmity of the
latter’s title. Under the facts, the statute of limitations will not apply to Percival because
Melvin knew that a part of the land covered by his title actually belonged to Percival. So,
instead of nullifying in toto the title of Melvin, the court, in the exercise of equity and
jurisdiction, may grant prayer for the reconveyance of Lot B to Percival who has actually
possessed the land under a claim of ownership since 1947. After all, if Melvin’s title is
declared void ab initio and the land is reverted to the public domain, Percival would just
the same be entitled to preference right to acquire the land from the government.
Besides, well settled is the rule that once public land has
been in open, continuous, exclusive and notorious possession under a bonafide
claim of acquisition of ownership for the period prescribed by Section 48 of the Public
Land Act, the same ipso jure ceases to be public and in contemplation of law acquired
the character of private land. Thus, reconveyance of the land from Melvin to
Percival would be the better
procedure (Vitale vs. Anore, 90 Phil. 855; Pena, Land Titles and Deeds, 1982,
p. 427).

ALTERNATIVE ANSWER:
The action of the Solicitor General should prosper, considering that the doctrine of
indefeasibility of title does not apply to free patent secured through fraud. A certificate
of title cannot be used as shield to perpetuate fraud. The State is not bound by the
period of prescription stated in
Sec. 38 of Act 496. (Director of Lands vs. Abanilla, 124 SCRA 358).

The action for reconveyance filed by Percival may still prosper provided that the
property has not passed to an innocent third party for value (Dablo
vs. Court of Appeals, 226 SCRA 618), and provided that the action is filed within
the prescriptive period of ten years (Tale vs. Court of Appeals, 208 SCRA 266).
Since the action was filed by Percival 19 years after the issuance of Melvin’s title, it is
submitted that the same is already barred by prescription.

ALTERNATIVE ANSWER (to second part of question)

The action for reconveyance filed by Percival will prosper, because the land has ceased
to be public land and has become private land by open, continuous, public, exclusive
possession under a bona fide claim of ownership for more than thirty years, and Percival
is still in possession of the property at present. His action for reconveyance can be
considered as an action to quiet title, which does not prescribe if the plaintiff is in
possession of the property. (Olviga v.CA, G.R. No. 1048013, October 21,1993)

Remedies; Reopening of a Decree; Elements (1992)

What are the essential requisites or elements for the allowance of the reopening or
review of a decree of registration?

SUGGESTED ANSWER:

The essential elements are: (1) that the petitioner has a real or dominical right; (2) that
he has been deprived thereof through fraud; (3) that the petition is filed within one (1)
year from the issuance of the decree; and (4) that the
property has not yet been transferred to an innocent purchaser
(Rublico vs. Orellana 30 SCRA 511; Ubudan vs.Gil 45 SCRA 17).

OPTIONAL EXTENDED ANSWER:

Petition for review of the Decree of Registration. A remedy

expressly provided in Section 32 of P. D. No. 1529
(formerly Section 38. Act 496), this remedy has the following elements:

a) The petition must be filed by a person claiming dominical or other real rights to
the land registered in the name of respondent.

b) The registration of the land in the name of respondent

was procured by means of actual, (not just constructive) fraud, which must be
extrinsic. Fraud is actual if the registration was made through deceit or any other
intentional act of downright dishonesty to enrich oneself at the expense of another. It is
extrinsic when it is something that was not raised, litigated and passed upon in the main
proceedings.

c) The petition must be filed within one (1) year from the date of the issuance of the
decree.

d) Title to the land has not passed to an Innocent purchaser for value (Libudan
vs. Gil, 45 SCRA 27, 1972), Rublico vs. Orrelana. 30 SCRA 511, 1969);
RP vs. CA, 57 G. R No. 40402. March 16, 1987).

Torrens System vs.Recording of Evidence of Title (1994)

Distinguish the Torrens system of land registration from the system of recording of
evidence of title.

SUGGESTED ANSWER:

a) The TORRENS SYSTEM OF LAND REGISTRATION is a system for the

registration of title to the land. Thus, under this system what is entered in the
Registry of Deeds, is a record of the owner’s estate or interest in the land, unlike
the system under the Spanish Mortgage Law or the system under Section 194 of the
Revised Administrative Code as amended by Act 3344 where only the evidence of
such title is recorded. In the latter system, what is recorded is the deed of conveyance
from hence the owner’s title emanated—and not the title itself.

b) Torrens system of land registration is that which is

prescribed in Act 496 (now PD 1529), which is either Judicial or quasi-judicial.
System or recording of evidence of title is merely the registration of evidence of
acquisitions of land with the Register of Deeds, who annotates the same on the existing
title, cancels the old one and issues a new title based on the document presented for
registration.

Unregistered Land (1991)

Maria Enriquez failed to pay the realty taxes on her unregistered agricultural land
located in Magdugo, Toledo City. In 1989, to satisfy the taxes due, the City sold it at
public auction to Juan Miranda, an employee at the Treasurer’s Office of said City,
whose bid at P10,000.00 was the highest. In due time, a final bill of sale was executed in
his favor.

Maria refused to turn-over the possession of the property to Juan alleging that (1) she
had been, in the meantime, granted a free patent and on the basis thereof an Original
Certificate of Title was issued to her, and (2) the sale in favor of Juan is void from the
beginning in view of the provision in the Administrative Code of 1987 which prohibits
officers and employees of the government from purchasing directly or indirectly any
property sold by the government for nonpayment of any tax, fee or other public charge.
(a) Is the sale to Juan valid? If so, what is the effect of the Issuance of the Certificate of
Title to Maria?

(b) If the sale is void, may Juan recover the P10,000.00? If not, why not?

(c) If the sale is void, did it not nevertheless, operate to divert Maria of her ownership?
If it did, who then is the owner of the property?

SUGGESTED ANSWER:

A. The sale of the land to Juan is not valid, being contrary to law. Therefore, no transfer
of ownership of the land was effected from the delinquent taxpayer to him. The original
certificates of title obtained by Maria thru a free patent grant from the Bureau of Lands
under Chapter VII, CA 141 is valid but in view of her delinquency, the said title is subject
to the right of the City Government to sell the land at public auction. The issuance of the
OCT did not exempt the land from the tax sales. Section 44 of P.O. No. 1529 provides
that every registered owner receiving a Certificate of Title shall hold the same free from
an encumbrances, subject to certain exemptions.

B. Juan may recover because he was not a party to the violation of the law.

C. No, the sale did not divest Maria of her title precisely because the sale is void. It is as
good as if no sale ever took place.

In tax sales, the owner is divested of his land initially upon award and issuance of a
Certificate of Sale, and finally after the lapse of the 1 year period from date of
registration, to redeem, upon execution by the treasurer of an instrument sufficient in
form and effects to convey the property. Maria remained owner of the land until another
tax sale is to be performed in favor of a qualified buyer.