KASILAG V.

RODRIGUEZ, 69 PHIL 217

Respondents, Rafaela Rodriguez, et al., children and heirs of the deceased Emiliana Ambrosio,
commenced a civil case to recover from the petitioner the possession of the land and its
improvements granted by way of homestead to Emiliana Ambrosio (EA).
FACTS: Kasilag and Emiliana Ambrosio entered a contract of mortgage of improvements of
land acquired as homestead to secure the payment of the indebtedness of P1,000 plus
interest. The parties stipulated that Ambrosio was to pay the debt with interest within 4
years., and in such case, mortgage would not have any effect. They agreed that Ambrosio
would execute a deed of sale if it would not be paid within 4 years and that she would pay
the tax on the land. After a year, it turned out that she wasnt able to pay the tax. Hence,
they entered a verbal agreement whereby she conveyed to the latter the possession of the
land on the condition that they would not collect the interest of the loan, would attend to the
payment of the land tax, would benefit by the fruits of the land, & would introduce
improvement thereof.

ISSUE: W/N the petitioner should be deemed the possessor of the land in good faith because
he was unaware of any flaw in his title or in the manner of its acquisition by which it is
invalidated
HELD:
Doctrine: The possession of the land is illegal and void because such contract is expressly
prohibited by Sec 116 of Act No 1874 as amended. Petitioner acted in bad faith in taking
possession of the land because he knew that the contract he made with Ambrosio was an
absolute sale and that the latter could not sell the land because it is prohibited by Sec 116 of
Act 2874. Gross and inexcusable ignorance of the law may not be the basis of good faith.
The possession by the petitioner and his receipts of the fruits of the land, considered as
integral elements of the contract of antichresis, are illegal and void agreements, bec. the such
contract is a lien and as such is expressly prohibited by Sec 116 of Act No. 2874, as amended.
The CA held that petitioner acted In BF in taking possession of the land bec. he knew that the
contract he made w/ EA was an absolute sale, and further, that the latter could not sell the
land bec. it is prohibited by Sec. 116 of Act 2874.
xxx [A] person is deemed a possessor in BF when he knows that there is a flaw in his title or
in the manner of its acquisition, by w/c it is invalidated.
The question to be answered is w/n the petitioner should be deemed a possessor in GF bec.
he was unaware of any flaw in his title or in the manner of its acquisition by w/c it is
invalidated. Ignorance of the flaw is the keynote of the rule. From the facts as found by the
CA, we can neither deduce nor presume that the petitioner was aware of a flaw in his title or
in the manner of its acquisition, aside from the prohibition contained in Sec. 116. This being
the case, the question is w/n GF may be premised upon ignorance of the laws.
Gross and inexcusable ignorance of the law may not be the basis of GF but excusable
ignorance may be such basis (if it is based upon ignorance of a fact.) It is a fact that the
petitioner is not conversant w/ the laws bec. he is not a lawyer. In accepting the mortgage of
the improvements he proceeded on the well-grounded belief that he was not violating the
prohibition regarding the alienation of the land. In taking possession thereof and in
consenting to receive its fruits, he did not know, as clearly as a jurist does, that the
possession and enjoyment of the fruits are attributes of the contract of antichresis and that
the latter, as a lien, was prohibited by Sec. 116. Thus, as to the petitioner, his ignorance of
the provisions of sec. 116 is excusable and may be the basis of GF.
The petitioners being in GF, the respondents may elect to have the improvements introduced
by the petitioner by paying the latter the value thereof, P3,000, or to compel the petitioner to

buy and have the land where the improvements or plants are found, by paying them its
market value to be fixed by the court of origin, upon hearing the parties.

MORAN, J., dissenting:

According to section 116 of Act No. 2874, as amended by section 23 of Act No. 3517, "lands
acquired under the free patent or homestead provisions shall not be subject to encumbrance
or alienation from the date of the approval of the application and for a term of five years from
and after the date of issuance of the patent or grant, nor shall they become liable to the
satisfaction of any debt contracted prior to the expiration of said period."
About June 11, 1931, homestead patent No. 16074 was issued to Emiliana Ambrosio, now
deceased. On May 16, 1932 Emiliana Ambrosio offered the sale of the said homestead to the
herein petitioner, Marcial Kasilag, and in view of the above-quoted legal prohibition, the
parties executed the document Exhibit 1, copied in the majority decision. The heirs of
Emiliana Ambrosio filed a complaint for the annulment of the contract in the Court of First
Instance of Bataan, and from the judgment rendered by said court an appeal was taken to the
Court of Appeals, which held that the true contract between the parties is one of absolute
sale, wherefore, it is null and void under the already cited legal prohibition. Marcial Kasilag
comes to this court on certiorari, and this court reverses the decision of the Court of Appeals.
The only question is as to the true contract between the parties at the time of the execution
of the deed Exhibit 1; Kasilag contends that the contract is that set out in the document
Exhibit 1, that is, a mortgage of the improvements of the homestead to secure a loan of one
thousand pesos given to Emiliana Ambrosio; and the latter's heirs, in turn, contend that the
contract is one of the absolute sale of the homestead, wherefore, it is null and void. The
findings of the Court of Appeals are as follows:
The pertinent facts as disclosed by the evidence of record are as follows:
On August 27, 1918 the deceased, Emiliana Ambrosio, applied for the land in question as a
homestead, not known as Lot No. 285 of the Limay cadastral survey of Bataan, and the
application was approved on September 10, 1919. A final proof was submitted on November
10, 1927 which was approved on October 17, 1929. The homestead patent No. 16074 and
homestead certificate of title No. 325 were issued in favor of the applicant on June 11, 1931
which were recorded on June 26, 1931 in the office of the register of deeds in accordance with
the provisions of Section 122 of Act No. 496.
On or about May 16, 1932, the homestead owner Emiliana Ambrosio offered to sell the
property to the defendant and appellee, Marcial Kasilag. The latter, upon examining her title
found that it was a homestead patent and knew, therefore, that the land subject of the patent
could not be alienated by express prohibition of law, so he devised means by which the
proposed sale might not appear in any document and had the patentee, Emiliana Ambrosio,
execute a public instrument, Exhibit 1, purporting to be a mere mortgage of the
improvements thereon consisting of four mango trees, fruit bearing; one hundred ten hills of
bamboo trees, one thousand and six boga trees, with the assessed value of P860, in
consideration of the sum of P1,000 alleged to have been loaned by the said Kasilag to the
said patentee Emiliana Ambrosio. It was expressly stipulated in that document that the
aforementioned amount should be paid within four and a half years from the date of the
instrument (May 16, 1932), the condition being that if she failed to redeem the alleged
mortgage at the expiration of the stipulated period, she would execute a deed of absolute
sale of the property therein described for the same amount of the alleged mortgage (P1,000)
including all unpaid interest at the rate of 12 per cent per annum in favor of the alleged
mortgagee. It was further stipulated therein that the said Emiliana should pay all the taxes
and assessment which might become due on the land and improvements during the term of
the agreement and that within thirty days after the date of the execution thereof she should
file a motion before the Court of First Instance of Bataan requesting the cancellation of the
homestead certificate No. 325 above referred to and the issuance in lieu thereof of a
certificate of title under the provisions of the Land Registration Act No. 496, as amended by
Act No. 3901.

The lot in question was originally declared for land tax purposes in the name of the
homestead owner, Emiliana Ambrosio, and assessed at P1,020 in 1933; but on May 22, 1934,
the tax declaration was transferred in the name of the appellee, Marcial Kasilag, and on March
6, 1936 the assessed value was raised to P2,180.
Emiliana, however, never paid any interest on the alleged loan of P1,000 or paid taxes on the
land since the execution of the contract.
The evidence further discloses that the appellee entered upon the actual possession of the
land and had been holding the same up to the present time, having planted various kinds of
fruit trees valued according to him at P5,000, and collected the products thereof for his own
exclusive benefit.
Construing the contract, Exhibit 1, in the light of all the foregoing facts and circumstances
under which it was executed in relation to the subsequent acts of the contracting parties, we
are led to the inescapable conclusion that their real intention was to execute an agreement of
absolute sale of the homestead together with the improvements thereon. The stipulation
concerning an alleged mortgage in the instrument is a mere devise to circumvent the law
which expressly prohibits the alienation or encumbrance of the homestead during the period
of five years from the date of the issuance of the homestead patent. (Sec. 116 of Act No.
2874 as amended by Act No. 3517.)
It is inconceivable, and, therefore, we refuse to believe that the appellee, Marcial Kasilag,
being an intelligent man far above the average, would accept improvements valued at only
P860 as security for the payment of a larger amount of P1,000, the alleged loan. We entertain
no doubt that at the time the execution of the contract, Exhibit 1, the appellee knew that the
homestead owner, Emiliana Ambrosio, a poor ignorant woman, was badly in need of money
and that she was determined to dispose of and alienate definitely her homestead, as
evidenced by the fact testified to by Gavino Rodriguez as witness for the said appellee that
she actually offered to sell the land to the latter. He also knew that she would not be able to
pay back to him such a large amount with interest of 12 per cent per annum because she had
no other income except what she would derive from the homestead. Under such
circumstances, there is reason to believe that she was no longer concerned with the form in
which the contract would be drawn, as long as could obtain the amount of P1,000 which was
agreeable to her as the price of the homestead she offered to sell to the appellee. This
conclusion is supported in part by the subsequent action of Emiliana in not paying any
interest on the alleged loan of P1,000 or the land taxes thereon since the execution of the
contract and by the action of the appellee in declaring the land for tax purposes in his own
name as owner thereof, notwithstanding that he had no interest in the land, as he alleged,
except in the improvements only.
The contract of absolute sale was consummated, because the grantor, Emiliana, received full
payment of the purchase price disguised as a loan of P1,000 and placed the grantee, Marcial
Kasilag, in absolute possession and control of the land conveyed to him with all the
improvements thereon. The stipulation under article VIII of the contract, Exhibit I, to the effect
that the grantor would execute a deed of absolute sale of the property herein described for
the said amount of this mortgage including all unpaid interest at the rate of 12 per cent per
annum in favor of the mortgagee', clearly indicates that there was nothing left to be done
except the execution of the deed of absolute sale, which is merely a matter of form in
contracts of this nature, which was postponed until after the expiration of four and a half
years because by that time the period of five years within which the property could not be
alienated nor encumbered in any way, as provided by section 116 of Act No. 2874 as
amended by Act No. 3517, supra, would have already expired. If the real purpose was to
mortgage the improvements only as specified in article VIII thereof it was provided that in
case of failure to redeem the alleged mortgage the grantor would be required to execute a
deed of absolute sale of the property described therein for the same amount of the mortgage
in favor of the grantee, and not of 'the improvements only'? It is clear, therefore, that the real
contract under Exhibit 1, was one of absolute sale and not a mortgage with future sale.

In other words, although the document Exhibit 1 states that it is a mortgage of the
improvements, with a stipulation regarding a future sale of the land in case of failure to
comply with the mortgage obligations, in reality the true contract between the parties is one
of absolute sale in the light of the circumstances of the case, among them the following:
First, Emiliana Ambrosio offered the sale, not the mortgage, of her homestead to Marcial
Kasilag, and it is a fact found established by the Court of Appeals that she was agreeable to
the sum of one thousand pesos as the price of the sale offered by her. If this is so, it is
unlikely that Kasilag would refuse the offer of sale of the homestead and would accept in lieu
thereof a simple mortgage of the improvements, for the same sum of one thousand pesos;
Second. In the deed it is stipulated that, if at the expiration of the period of four and a half
years, the debtor should fail to redeem the mortgage, she would execute in favor of the
creditor, Marcial Kasilag, a deed of absolute sale not only of the mortgaged improvements but
also of the land for the same amount of the loan of one thousand pesos. This magic
conversion of the mortgage of the improvements into an absolute sale of the land at the
expiration of four and a half years and without any additional consideration can only mean
that the two contracts are one and the same thing, and that the first has been availed of to go
around the legal prohibition. The scheme is very obvious, and to make any attempt to
reconcile it with good faith is simply to fall into it.
The mortgage of the improvements could not have been intended because the supposed loan
which it guaranteed was the same price of the stipulated sale to be later executed, and
further because Kasilag knew, according to the findings of fact of the Court of Appeals, that
Emiliana Ambrosio was a poor and ignorant woman who was not in a position to return to one
thousand pesos;
Third. Kasilag had always considered the contract as one of sale of the land and not as a
mortgage of the improvements, because he put the tax declaration of the land in his name,
paid the corresponding land tax, took possession of the land, received the fruits thereof for
his exclusive use, and introduced thereon permanent improvements, one of them being a
summer house, all of which were valued at about five thousand pesos. It is not an attribute of
a contract of mortgage that the creditor should take possession of the mortgaged property, or
that he should pay the taxes thereon. Kasilag would not spend five thousand pesos for
permanent improvements if he knew that his possession was precarious.
Fourth. In the document it is stipulated that the debtor would pay interest, but she did not pay
any, and the alleged mortgage was not foreclosed thereby, which shows that the stipulation
was nothing but a ruse.
Fifth. The deed Exhibit 1 was drawn by Kasilag, because it is in English, and the other party is
a poor and ignorant woman, wherefore, all doubts and uncertainties arising therefrom should
be resolved against Kasilag. It is to noted that in this document are phrases indicative of the
real contract between the parties. For instance: in clause IV the word paid and not loaned is
used in referring to the loan of one thousand pesos; and clause IX of the document states
"the foregoing contract of sale."
Under all these circumstances, the irresistible conclusion is that the real contract between the
parties is an absolute sale, and that the contract of mortgage was made to appear in the
document Exhibit 1 for the sole purpose of defeating the legal prohibition. Nevertheless, the
majority of this Court, brushing aside the findings of fact made by the Court of Appeals
without stating its reasons therefor, holds as to the document Exhibit 1, that "as the terms
thereof are clear and leave no room for doubt, it should be interpreted according to the literal
meaning of its clauses." I have already shown in speaking of the second circumstance, that
the context itself of the document Exhibit 1 discloses strong tokens that the contract between
the parties was one of the sale and not of mortgage. Moreover, the rule relied upon by the
majority is only applicable in the absence of any allegation that the document does not
express the real contract between the parties. Under section 285, No. 1, of Act No. 190, a

document, however clear its conditions may be, may and should be rejected when it is
alleged and shown by evidence aliunde that it does not express the true intent of the parties.
We have often considered as document, by its terms a contract of absolute sale, as one of
mortgage because it has been so alleged and established by convincing oral evidence.
(Cuyugan vs. Santos, 34 Phil., 100; Villa vs. Santiago, 38 Phil., 157; Laureano vs. Kilayco, 34
Phil., 148; Cuyugan vs. Santos, 39 Phil., 970; Rodriguez vs. Pamintuan, 37 Phil., 876; see also
Manalovs. Gueco, 42 Phil., 925; Gatmaitan vs. Nepumuceno, 42 Phil., 295.)
The majority decision does not only pass over the findings of fact made by the Court of
Appeals, but further, gives weight to certain facts which said court finds not to have been
established. For instance, we have the following passages the majority decision:
One year after the execution of the aforequoted deed, that is, in 1933, it came to pass that
Emiliana Ambrosio was unable to pay the stipulated interest as well as the tax on the land
and its improvements. For this reason, she and the petitioner entered into another verbal
contract whereby she conveyed to the latter the possession of the land on condition that the
latter would not collect the interest on the loan, would attend to the payment of the land tax,
would benefit by the fruits of the land, and would introduce improvements thereon. . . . .
. . . This stipulation was verbally modified by the same parties after the expiration of one
year, in the sense that the petitioner would take possession of the land and would benefit by
the fruits thereof on condition that he would condone the payment of interest upon the loan
and he would attend to the payment of the land tax. . . . .
These two paragraphs state as an established fact the supposed verbal contract between the
parties which Kasilag tried to prove by his testimony. However, the Court of Appeals expressly
held: "We believe, however, that the trial court erred in giving probative value to the
testimony of the appellee (Marcial Kasilag) with reference to the alleged verbal agreement
with the deceased, Emiliana Ambrosio, and based thereon the conclusion that the appellee
acted in good faith," (Words in parenthesis are mine.)
Rule 47, paragraph (b), of our Rules, provides expressly that in appeals to this court
on certiorari, "only questions of law may be raised and must be distinctly set forth." And we
have held in various decisions that in passing upon the legal conclusions of the Court of
Appeals, we shall abide by the findings of fact of said court.
I, moreover, find certain ambiguities in the majority decision, for while it states on the one
hand that the verbal contract had for its purpose the "alteration of the mortgage contract
clearly entered into, converting the latter into a contract of antichresis," (underscoring mine)
thereby implying that the mortgage contract was abandoned by the parties and ceased to
exist, in the dispositive part of its decision, the majority holds that the mortgage of the
improvements is valid and binding, and gives to the respondents the right to "redeem the
mortgage of the improvements by paying to the petitioner within three months the amount of
P1,000 . . . ." It, therefore, requires compliance with a contract that has ceased to exist.
While on the one hand the majority states that the aforesaid verbal contract is one of
antichresis and that it is void, on the other hand, it gives force thereto by holding that the
interest on the loan of one thousand pesos is sufficiently "set off by the value of the fruits of
the mortgaged improvements which the petitioner received." And, furthermore, why should
the interest be set off against the fruits of the improvements only and not against those of the
entire land? And if the verbal contract of antichresis is void, why is Kasilag not required to
render an accounting of the fruits of the land received by him which may exceed the total
amount of interest, taxes and even the principal itself?
The majority states that Kasilag, in taking possessions of the homestead, receiving its fruits
and introducing improvements thereon, did so under the void contract of antichresis, and did
so in good faith as he was excusably unaware of the legal provision which prohibits the
incumbrance of the homestead within the period of five years. Whether Kasilag was aware or

unaware of the legal prohibition is again a factual question resolved by the Court of Appeals
as follows: "the appellee ( Marcial Kasilag) was also aware of these provisions which were
incorporated in the homestead patent shown to him at the beginning of the transaction"
(Words in parenthesis are mine). I do not understand how we can disturb this factual finding.
I found, moreover, that in the majority decision it is ordered that, if the heirs of Emiliana
Ambrosio cannot pay the value of the permanent improvements introduced by Marcial
Kasilag, the latter may have the homestead by paying to them its price in the market. The
improvements were appraised by the trial court at three thousand pesos, and as the heirs of
Emiliana Ambrosio probably inherited nothing from the latter but poverty, they will eventually
be unable to pay the said amount and, in the last analysis, will lose the homestead of their
mother. The practical effect, therefore, of the majority decision is that the heirs of Emiliana
Ambrosio will be deprived of the homestead by virtue of a void antichretic obligation
contracted by her within the period of five years from the granting of the homestead. And
this, at least, is in violation of the spirit of section 116 of the Homestead Act.
I have other reasons which I need not set out to bring this dissent to a close. But before I
conclude, I should like to state that the Homestead Act has been enacted for the welfare and
protection of the poor. The law gives a needy citizen a piece of land where he may build a
modest house for himself and family and plant what is necessary for subsistence and for the
satisfaction of life's other needs. The right of the citizens to their homes and to the things
necessary for their subsistence is as vital as the right to life itself. They have a right to live
with a certain degree of comfort as become human beings, and the State which looks after
the welfare of the people's happiness is under a duty to safeguard the satisfaction of this vital
right. Moreover, a man with a home and a means of subsistence is a lover of peace and order
and will profess affection for his country, whereas one without a home and in penury is not
only a social parasite but also a dangerous element in the social order. The Homestead Act at
once aims at the promotion of wholesome and happy citizenship and the wiping out of the
germs of social discontent found everywhere.
Considering the social and economic ends of the Homestead Act, the courts should exercise
supreme care and strict vigilance towards faithful compliance with all its benign provisions
and against the defeat, directly or indirectly, of its highly commendable purposes. And it is
my firm conviction that where, as in the present case, a rich and clever man attempts to
wrest a homestead granted to a poor and ignorant woman, the slightest tokens of illegality
should be enough to move the courts to apply the strong arm of the law.
I dissent from the majority decision and vote for the affirmance of the decision of the Court of
Appeals.

FLORES v BAGAOISAN
Apr. 15, 2010
FACTS:
Petitioners executed a Deed of Confirmation and Quitclaim in favor of Vicente T. Lazo.
Petitioners agreed to sell, cede, convey, grant, and transfer by way of QUITCLAIM to Lazo.
Respondent Marciano Bagaoisan, bought the subject property from Lazo.
Respondent filed an action for ownership, quieting of title, partition and damages against
petitioners, praying that he be declared as the true owner of the subject property and that the
entire property covered by OCT No. P-11880 be partitioned among them. In the Complaint,
respondent asserted that he was a tenant of Lazo and that he had been working on the
subjec0t property since time immemorial. He said that, since he bought the property in 1977,
he possessed the land as owner and paid real property tax thereon. He claimed that the
subject property was erroneously covered by OCT No. P-11880 and that petitioners have

previously recognized such fact, considering that they executed an affidavit acknowledging
the erroneous inclusion of the property in their title. He averred that, lately, petitioners had
denied his ownership of the land and asserted their ownership thereof by working and
harvesting the crops thereon.[5]
Petitioners stated that they did not relinquish ownership or possession of the land to Lazo.
While admitting that they executed the Deed of Confirmation and Quitclaim in favor of Lazo,
petitioners claimed that they were misled into signing the same, with Lazo taking advantage
of their lack of education. Petitioners contended that it was too late for respondent to assert
title to the disputed portion because the title covering the same had already become
indefeasible one year after it was issued.
RTC ruled in favor of respondent. CA affirmed.
ISSUE:
Whether or not the Deed of Confirmation and Quitclaim is void and violates Sec. 118 of the
Public Land Act (CA 141), which prohibits the alienation of lands through a homestead patent.
RULING: YES
Section 118 of the Public Land Act, which states:

xxx Except in favor of the Government or any of its branches, units, or institutions, lands
acquired under free patent or homestead provisions shall not be subject to encumbrance or
alienation from the date of the approval of the application and for a term of five years from
and after the date of issuance of the patent and grant xxx
An OCT issued on the strength of a homestead patent partakes of the nature of a
certificate issued in a judicial proceeding and becomes indefeasible and incontrovertible upon
the expiration of one year from the date of the promulgation of the Director of Lands order
for the issuance of the patent.
Respondent did not allege in his complaint or prove during the trial that fraud attended
the registration of the subject property in petitioners names. In fact, there was no allegation
as to how petitioners were able to secure title to the property despite the alleged ownership
of respondents predecessor.
More importantly, respondent failed to prove that he has title to the subject property.
The Public Land Act requires that the possessor or his predecessors-in-interest must be in
open, continuous, exclusive, and notorious possession and occupation of the land for at least
thirty years.
It would be well to mention that the execution of the Deed of Confirmation and
Quitclaim within the five-year prohibitory period also makes the homestead patent
susceptible to cancellation, and the subject property being reverted to the public domain.

IGTIBEN VS RP AND CA
G. R. NO. 158449

October 22, 2004

Petitioners filed with the trial court an application for registration of land under Presidential
Decree (PD) No. 1529, covering a parcel of land. Petitioners alleged that they acquired the
Subject Property by purchase, and that they, by themselves and through their predecessorsin-interest, had been in actual, continuous, uninterrupted, open, public, and adverse
possession of the Subject Property in the concept of owner for more that 30 years. 3

The Tonido family sold the Subject Property to petitioners, as evidenced by a Deed of Absolute
Sale.7
The history of possession of the Subject Property, was supported by tax declarations in the
name of petitioners and their predecessors-in-interest from 1958 to 1998. 8
The trial court rendered a decision approving petitioners application for registration of the
Subject Property. The Republic of the Philippines, represented by the Office of the Solicitor
General, appealed the decision of the trial court to the Court of Appeals.
In its appeal, the Republic alleged that the trial court erred in approving the application for
registration despite petitioners failure to prove open, continuous, exclusive and notorious
possession and occupation of the Subject Property since 12 June 1945, or earlier, as required
by Section 48(b) of Commonwealth Act No. 141, otherwise known as the Public Land Act, as
amended by PD No. 1073. Moreover, petitioners also failed to produce monuments of title to
tack their possession to those of their predecessors-in-interest in compliance with the
prescriptive period required by law. 9
On 20 December 2002, the Court of Appeals rendered a decision finding the appeal
meritorious, setting aside the decision of the trial court, and dismissing the application for
registration of petitioners.10 The Court of Appeals denied petitioners Motion for
Reconsideration in its resolution dated 22 May 2003. 11Petitioners filed this petition for review
on certiorari
Issue: 1) Whether petitioners have complied with the period of possession and occupation
required by the Public Land Act?
Held:
(1) Section 44 of the Public Land Act, as amended by RA No. 6940, which provides for a
prescriptive period of thirty (30) years possession, applies only to applications for free
patents;
(2) The case at bar is a judicial application for confirmation of an imperfect or incomplete title
over the Subject Property covered by Section 48(b) of the Public Land Act; and
(3) Section 48(b) of the Public Land Act requires for judicial confirmation of an imperfect or
incomplete title the continuous possession of the land since 12 June 1945, or earlier, which
petitioners herein failed to comply with.

IHVCP v. UP (200 SCRA 554)

INTERNATIONAL HARDWOOD AND VENEER COMPANY OF THE PHILIPPINES, petitioner-appellee,
vs.
UNIVERSITY OF THE PHILIPPINES and JOSE C. CAMPOS, JR., respondents-appellants.
G.R. No. L-52518 ;August 13, 1991
Facts:
IHVCP is a company engaged in the manufacture, processing and exportation of
plywood. It renewed its timber license, which was granted by the government and shall be
valid for 25 years, in early 1960. Said license authorizes the company to cut, collect and
remove timber from the portion of timber land located in certain municipalities of Laguna,
including Paete.

In 1964, the Congress enacted R.A. 3990, an Act establishing an experiment station for
UP. The said experiment station covers a portion of the timberland in Paete, occupied by
IHVCP so UP, who claims ownership of said portion of timberland, demanded the latter to pay
the forest charges to it, instead of the BIR. IHVCP rejected the demand and it filed a suit
against UP, claiming that R.A. 3990 does not empower UP to scale, measure and seal the
timber cut by it within the tract of land referred to in said Act, and collect the corresponding
forest charges prescribed by the BIR.
Issue/s:
Whether or not UP is the owner of the portion of timberland in Paete.
Ruling:
Yes.
The Court ruled that R.A. 3990 ceded and transferred in full ownership to UP the area, which
means that the Republic of the Philippines completely removed it from the public domain. In
respect to the areas covered by the timber license of IHVCP, the said Act removed and
segregated it from being a public forest.
The Court further cited Sec. 3 of R.A. 3990, which provides that, "any incidental receipts or
income therefrom shall pertain to the general fund of the University of the Philippines. The
provision of the Act is clear that UP, being the owner of the land, has the right to collect forest
charges and to supervise the operations of IHVCP insofar as the property of the UP within it is
concerned.

REPUBLIC vs. DOLDOL

295 SCRA 359, September 10, 1998
FACTS: Sometime in 1959, respondent Nicanor Doldol occupied a portion of land in Opol,
Misamis Oriental. On 1963, he filed an application for saltwork purposes for the said area but
the Director of Forestry rejected the same.
Sometime in 1965, the Provincial Board of Misamis Oriental passed a resolution reserving a
certain lot as a school site. This lot unfortunately included the lot of Doldol.
Sometime in 1970, the Opol High School filed a complaint for accion possessoria with the RTC,
the court ruled on schools power.
On appeal, the CA reversed the decision of teh court ruling that Doldol was entitledto the
portion he occupied, he having possessed the same for 32 years (1959-1991).

ISSUE: Whether or not Doldol has the better right to possess the land in dispute?
HELD: No. The Public Land Act requires that the applicant must prove (a) that the land is
alienable public land and (b) that his open, continuous, exclusive and notorious possession
and occupation of the same must either be since time immemorial or for the period
prescribed in the Public Land Act. When the conditions set by law are complied with the
possessor of the land, by operation of law, acquires a right to grant, a government grant,
without the necessity of title/certificate of tile being issued.
The evidence presented shows that the land in dispute is alienable and disposable in
accordance with the District Foresters Certification. Doldol thus meets the first requirement.
Consequently, Doldol could not have acquired an imperfect title to the disputed land since his
occupation of the same started only in 1955, much later than June 12, 1945. Not having
complied with the conditions set forth by law, Doldol cannot be said to have acquired a right
to the land or a right to assert a right superior to the school given that then Pres. Aquino had
reserved the lot for Opol National School.
The privilege occupying public lands with a view of pre-empting confers no contractual or
vested right in the land occupied and the authority of the President to withdraw such lands for
sale or acquisition by the public, or to reserve them for public use, prior to divesting by the
government of title thereof stands even though this may defeat the imperfect right of settler.
Lands covered by reservation are not subject to entry, and no lawful settlement on them can
be acquired (Solicitor General)
In sum, Opol National School has the better right of possession over the
land in dispute.

PUGEDA v TRIAS
Mar. 31, 1962
This resolution concerns a motion for the reconsideration of the decision rendered by this
Court. The main argument in support of the motion is that the lots not fully paid for at the
time of the death of Miguel Trias, which lots were, by provision of the Friar Lands Act (Act No.
1120), subsequently transferred to the widow's name and later paid for by her out of the
proceeds of the fruits of the lands purchased, and for which titles were issued in the name of
the widow, belong to the latter as her exclusive paraphernal properties, and are
not conjugal properties of her deceased husband and herself. In our decision we laid down the
rule that upon the issuance of a certificate of sale to the husband of a lot in a friar lands
estate, purchased by the Government from the friars, the land becomes the property of the
husband and the wife, and the fact that the certificate of sale is thereafter transferred to the
wife does not change the status of the property so purchased asconjugal property of the
deceased husband and wife. The reason for this ruling is the provision of the Civil Code to the
effect that properties acquired by husband and wife are conjugal properties. (Art. 1401, Civil
Code of Spain). The provision of the Friar Lands Act to the effect that upon the death of the
husband the certificate of sale is transferred to the name of the wife is merely an
administrative device designed to facilitate the documentation of the transaction and the
collection of installments; it does not produce the effect of destroying the character
as conjugal property of the lands purchased. Hence, the issuance of the title, after completion
of the installments, in the name of the widow does not make the friar lands purchased her
own paraphernal property. The said lands, notwithstanding a certificate of sale, continue to be
the conjugal property of her deceased husband and herself.
The case of Arayata vs. Joya, et al., 51 Phil. 654, cited by the movants, is not applicable to the
case at bar because it refers to the superior rights of the widow recognized in Section 16 of
Act No. 1120 over transfers made by the husband which have not been approved by the
Director of Lands. As a matter of fact the syllabus in said case is as follows:
Widow's rights. The widow of a holder of a certificate of sale of friar lands acquired by the
Government has an exclusive right to said lands and their fruits from her husband's death,
provided that the deceased has not conveyed them to another during his lifetime and she
fulfills the requirements prescribed by the law for the purchase of the same.
A minor ground for the reconsideration is that the decision of Judge Lucero, having been set
aside by the Court of Appeals, could not be affirmed by Us. The setting aside of the said
decision was due to the fact that newly discovered evidence was found regarding the partition
of the estate of the deceased. The setting aside of the decision was not aimed or directed at
the judge's ruling that the properties acquired by the husband during his lifetime from the
friar lands estate were conjugalproperties of the husband and the wife..
The third ground raised is that the lots were never partitioned as conjugal assets of Mariano
Trias and Maria C. Ferrer. One of the arguments adduced in favor of the claim of the movants
that the properties in question, which were acquired during the lifetime of Mariano Trias, were
never partitioned is that, according to the records of the Register of Deeds and according to
the friar lands agents, the alleged partition of the said properties as conjugal properties of the
deceased Mariano Trias and Maria C. Ferrer had not been registered in said offices. The failure
to make the registration is perhaps due to the neglect the heirs. The fact, however, remains
that the exhibits presented in Court, especially Exhibit "3-Trias" and Annex "E", which are the
project of partition and the approval thereof, cannot be ignored by this Court. The neglect of
the parties in not actually partitioning the properties do not argue in favor of the fact that
partition was not a actually decreed. Adjudications may be made pro indiviso without actual
division or partition of the properties among the heirs.
WHEREFORE, the motion for reconsideration is hereby denied and the judgment rendered
declared final. So ordered.

G.R. No. 127827

March 5, 2003

ELEUTERIO, ANATALIA, JOSELITO, ROGELIO, EVANGELINE, NOEL, GUILLERMO,

LORENZO, DOMINGO, AMADO, and VICTORIA, all surnamed LOPEZ, petitioners,
vs.
THE HONORABLE COURT OF APPEALS, and spouses MARCELINO and CRISTINA S.
LOPEZ, FELISA LOPEZ and RAMON CORTEZ, ZOILO LOPEZ, LEONARDO LOPEZ and
LEONILA LOPEZ and spouses ROGELIO M. AMURAO and NOAMI T.
AMURAO, respondents.
PUNO, J.:
Before us is a petition for review on certiorari of the Decision1 dated September 30, 1996 of
the Court of Appeals in C.A.-G.R. CV No. 43837, which affirmed with modification the Decision
dated March 30, 1993 of the Regional Trial Court of Antipolo, Rizal, Branch 71, in Civil Case
No. 677-A.
The evidence shows that in 1920, Fermin Lopez occupied, possessed, and declared for
taxation purposes a parcel of public land containing an area of 19 hectares, 48 ares, 88
centares, more or less, situated in Makatubong, Barrio De la Paz, Antipolo, Rizal. He filed a
homestead application over the land, but his application was not acted upon until his death in
1934. When he died, he was survived by the following: (1) Hermogenes Lopez, now deceased,
leaving his children, respondents Marcelino, Felisa, Zoilo, and Leonardo, all surnamed Lopez,
as his heirs; (2) petitioner Eleuterio Lopez; (3) Juan Lopez, now deceased, leaving his children,
Guillermo, Lorenzo, Domingo, Amado, and Victoria, all surnamed Lopez, as his heirs; 2 and (4)
Nazario, now deceased, leaving his wife, petitioner Anatalia, and children, petitioners Joselito,
Rogelio, Evangeline and Noel, all surnamed Lopez, as his heirs.
Following Fermin's death, Hermogenes, being the eldest child, worked and introduced
additional improvements on the land. In 1936, he inquired from the Bureau of Lands the
status of his late father's application for a homestead grant. An official 3 of the bureau
informed him that the application remained unacted upon and suggested that he file a new
application. Following the suggestion, Hermogenes filed a homestead application in his own
name, which was docketed as No. 138612. After ascertaining that the land was free from
claim of any private person, the Bureau approved his application. In 1939, Hermogenes
submitted his final proof of compliance with the residency and cultivation requirements of the
law. The land was surveyed and a resulting plan, H-138612, was approved by the Director of
Lands, who thereafter ordered the issuance of the homestead patent. The patent was later
transmitted to the Register of Deeds of Rizal for transcription and issuance of the
corresponding certificate of title in his name.
Unaware that he has been awarded a homestead patent, Hermogenes executed on February
11, 1956 an Extra-judicial Partition of the disputed land with his brothers petitioner
Eleuterio, Juan, and Nazario. On September 12, 1958, however, the three executed a Deed of
Absolute Sale of their share in the land in favor of Hermogenes. The succeeding year,
Hermogenes applied with the Land Registration Commission for the registration of the
property in his name. This was docketed as LRC Case No. 2531. To his surprise, he found that
the land has been registered in the names of Fernando Gorospe, Salvador de Tagle, Rosario de
Tagle, Beatriz de Suzuarrequi and Eduardo Santos, who collectively opposed his application.
In December 1959, Hermogenes filed a complaint for the annulment of the free patent and
title against these persons before the Court of First Instance of Rizal, 4 docketed as Civil Case
No. 5957. Some of the defendants moved for its dismissal alleging that Hermogenes was not
a real party in interest since he previously sold his right to the land to one Ambrocio Aguilar
on July 31, 1959.
The case was dismissed.

Aguilar instituted on November 18, 1976 a new civil action before the CFI of Rizal, 5 docketed
as Civil Case No. 24873. It was similar to Civil Case No. 5957 except for the change in plaintiff
and the addition of the Bureau of Lands as co-defendant. On April 15, 1982, the lower court
declared Aguilar as the absolute owner of the land and OCT No. 537 and all subsequent
certificates of title emanating therefrom as void ab initio. This decision was affirmed in toto by
the Court of Appeals. In G.R. No. 90380, we affirmed the decision of the appellate court in a
decision promulgated on September 13, 1990. 6
After the April 15, 1982 decision of the CFI, and while the case was on appeal, respondent
Lopezes, as heirs of Hermogenes (who died on August 20, 1982), filed a complaint against
Aguilar before the RTC of Antipolo, Rizal. The July 14, 1984 complaint was for the cancellation
of the deed of sale executed by Hermogenes in favor of Aguilar dated July 31, 1959 and/or
reconveyance. It was docketed as Civil Case No. 463-A. On February 5, 1985, the lower court
declared the deed of absolute sale null and void ab initio and the respondents as the true and
absolute owner of the disputed land. Aguilar sought relief with the Court of Appeals, which
affirmed in toto the decision of the RTC in a Decision promulgated on August 18, 1987. 7 In
G.R. No. 81092, we denied Aguilar's petition for review in a resolution dated April 6, 1998 for
having been filed late.
On April 25, 1985, after the RTC of Antipolo rendered its February 5, 1987 decision in Civil
Case No. 463-A and pending its appeal, respondent Lopezes sold a large portion of the
disputed property to respondent spouses Amurao.
On May 31, 1985, petitioners Eleuterio, Anatalia, Joselito, Rogelio, Evangeline and Noel, all
heirs of Nazario Lopez, along with Guillermo, Lorenzo, Domingo, Amado, and Victoria, all heirs
of Juan Lopez, instituted the present action against the respondents before the RTC of
Antipolo, Rizal, Branch 71, docketed as Civil Case No. 677-A. They prayed, among others, that
they be declared co-owners of the property subject matter hereof and that private
respondents be ordered to reconvey to them 3/5 thereof as its co-owners, or in the
alternative, to pay its value. On June 26, 1985, respondents filed their Answer with
Compulsory Counterclaim alleging that they are the absolute owners of the contested land on
the basis of the homestead grant to their predecessor-in-interest, Hermogenes.
After the pre-trial on November 27, 1987, trial ensued. In the August 28, 1986 hearing
petitioners' counsel failed to appear, causing the case to be dismissed. The dismissal,
however, was reconsidered upon motion of petitioners' counsel, and the case was again set
for hearing. In the scheduled hearing of October 17, 1986, counsel for respondent was
absent. Upon proper motion, petitioners were allowed to present their evidence ex-parte on
December 5, 1986. Following the presentation of ex-parte evidence, the case was deemed
submitted for resolution.
On June 25, 1987, the court a quo rendered a decision in favor of the petitioners ordering the
division of the disputed lot in equal portions among the four children of Fermin or their heirs.
Respondents failed to appeal the decision but on September 10, 1987, they filed a petition for
relief from judgment, alleging that accident/excusable negligence prevented them from
attending the trial and that they have a good, substantial and meritorious defense. On
December 28, 1989, the court a quo set aside its decision dated June 25, 1987 and ordered a
pre-trial conference.
On January 30, 1990, respondents filed a Motion to Admit Amended Answer alleging for the
first time that petitioners have already sold to Hermogenes their shares in the contested
property: Petitioners opposed the motion on the ground that the amendments constituted
substantial alteration of the theory of the defense. On February 13, 1990, the court a
quo allowed respondents to amend the answer. When their motion for reconsideration was
denied, petitioners elevated the issue directly to this court via a Petition for Certiorari. On
April 25, 1990, we denied the petition for failure to comply with the requirements of Circular
1-88, with a further pronouncement that, "besides, even if the petition were admitted, the

same would still be dismissed as the Court finds that no grave abuse of discretion was
committed by public respondent." Trial on the merits once more proceeded in the court a quo.
While the case was on trial, complainants therein Guillermo, Lorenzo, Domingo, Amado and
Victoria, all children of Juan Lopez, entered into a compromise agreement with the respondent
Lopezes, heirs of Hermogenes, recognizing the latter's ownership and possession of the
property subject of the case. They confirmed the sale made by their father Juan to
Hermogenes. On July 20, 1992, the court a quo rendered a partial decision approving the
compromise agreement.8
On March 30, 1993, the court a quo rendered a Decision dismissing the complaint, the
dispositive portion of which states:
"WHEREFORE, judgment is hereby rendered:
1. Ordering the dismissal of the case;
2. Declaring Hermogenes Lopez as the exclusive owner of the property in question;
3. Ordering the plaintiffs to pay the defendants the amount of P20,000.00 as attorney's fees;
and
4. Ordering plaintiffs to pay the costs.
SO ORDERED."9
Feeling aggrieved, petitioners appealed to the Court of Appeals, which affirmed with
modification the above Decision, thus:
"Finally, We have to delete and disallow the award of attorney's fees for want of factual and
legal premise in the text of the appealed Decision.
IN VIEW OF ALL THE FOREGOING, the decision appealed from is AFFIRMED with
a modification that the award of attorney's fees is deleted. Costs against the appellants." 10
Hence, the present course of action where petitioners contend:
"I. The Honorable Court of Appeals in ruling that the propriety of the grant of respondents'
petition for relief from judgment has been rendered moot is not in accord with the decisions of
this Honorable Supreme Court.
II. The Court of Appeals' ruling that Fermin Lopez, the common predecessor-in-interest, was
not entitled to the grant of the homestead patent, hence petitioners are not co-owners of the
disputed property is not in accord with the evidence and the decisions of this Honorable
Supreme Court.
III. The Court of Appeals' ruling that the statement or declarations in the extra-judicial
partition (Exh. N); the special power of attorney (Exh. O); and the letter dated January 11,
1984 (Exh. Q) were based on a wrong assumption that the property is owned by their
common predecessor-in-interest is not in accord with the evidence and decisions of this
Honorable Supreme Court.
IV. The Court of Appeals committed reversible error in ruling that the forged absolute deed of
sale dated September 12, 1958 has no bearing on the respondents' claim over the disputed
property.
V. The Court of Appeals in not ruling that the remedy of partition is available to the petitioners
is not in accord with law.

VI. The Court of Appeals' ruling that laches applies to the herein (sic) who are close relatives
is not in accord with the decisions of this Honorable Supreme Court." 11
First, the procedural issue. Petitioners contend that the grant of relief from judgment is
erroneous as the respondents did not substantiate their allegation of fraud, accident, mistake,
or excusable negligence which unjustly deprived them of a hearing. They add that while
respondents had ample opportunity to avail of other remedies, such as a motion for
reconsideration or an appeal, from the time they received a copy of the decision on July 10,
1987, yet they did not do so.
Rule 38 of the 1997 Rules of Civil Procedure governs the petition for relief from judgment.
Sections 2 and 3 of the Rules provide:
"Section 2. Petition for relief from judgment, order or other proceedings. When a judgment
or final order is entered, or any other proceeding is thereafter taken against a party in any
court through fraud, accident, mistake or excusable negligence, he may file a petition in such
court and in the same case praying that the judgment, order or proceeding be set aside." 12
"Section 3. Time for filing petition; contents and verification. A petition provided for in
either of the preceding sections of this Rule must be verified, filed within sixty (60) days after
the petitioner learns of the judgment, final order or other proceeding to be set aside, and not
more than six (6) months after such judgment or final order was entered or such proceeding
was taken; and must be accompanied with affidavits showing the fraud, accident, mistake or
excusable negligence relied upon, and the facts constituting the petitioners' good and
substantial cause of action or defense, as the case may be." 13
We find that respondents were deprived of their right to a hearing due to accident. In the
October 17, 1986 hearing, their counsel was absent due to asthma, which disabled him and
made it difficult for him to talk. Similarly, when petitioners presented their evidence exparte on December 5, 1986, the counsel for the respondents again failed to appear as he
experienced another severe asthma attack. On both occasions, his absence is clearly
excusable.
Nor is there any doubt that respondents were able to show that they have a good and
substantial defense. They attached to their affidavit of merit the following documents: 14 the
decision of the Court of First Instance of Pasig in Civil Case No. 5957 entitled "Hermogenes
Lopez v. Fernando Gorospe, et al."; the decision also of the Pasig CFI, in Civil Case No. 24873,
entitled "Ambrocio Aguilar v. Fernando Gorospe"; the decisions of the lower and appellate
courts in the case of Marcelino Lopez, et al. v. Ambrocio Aguilar"; the decision of the Municipal
Trial Court of Antipolo in the case of "Ambrocio Aguilar v. Santos"; and the Deed of Sale
executed by and between Hermogenes and his brothers petitioner Eleuterio, Nazario and
Juan. The ruling in the foregoing cases recognized the absolute ownership and possession of
respondents' predecessor-in-interest, Hermogenes Lopez. The deed showed that petitioner
Eleuterio, Juan and Nazario sold their rights and interests in the contested lot to their brother
Hermogenes.
Time and again, we have stressed that the rules of procedure are not to be applied in a very
strict and technical sense. The rules of procedure are used only to help secure and not
override substantial justice.15 If a stringent application of the rules would hinder rather than
serve the demands of substantial justice, the former must yield to the latter. 16
We now address the substantive issues. The most pivotal is the petitioners' contention that
the appellate court erred in holding that they are not co-owners of the disputed property.
They argue that Fermin, their predecessor-in-interest, has complied with all the requirements
of the Public Land Act pertaining to a homestead grant, and is therefore entitled to a patent
as a matter of right. They claim that Fermin filed a homestead application over the land,
cultivated at least one-fifth of it, and resided on it for at least one year. Upon his death, they
argue that they became its co-owners through succession.

We do not agree. Homestead settlement is one of the modes by which public lands suitable
for agricultural purposes are disposed of. 17 Its object is to provide a home for each citizen of
the state, where his family may shelter and live beyond the reach of financial misfortune, and
to inculcate in individuals those feelings of independence which are essential to the
maintenance of free institutions. 18
The record is bereft of any evidence as to when Fermin exactly filed his homestead
application over the lot in controversy, but it must have been filed after 1920, the year he
first occupied and possessed the land, and before 1934, the year he died. During this period,
Act No. 2874 was the governing law.19 Section 12 thereof provides:
"Sec. 12. Any citizen of the Philippine Islands or of the United States, over the age of eighteen
years, or the head of a family, who does not own more than twenty-four hectares of land in
said Islands or has not had any benefit of any gratuitous allotment of more than twenty-four
hectares of land since the occupation of the Philippine Islands by the United States, may enter
a homestead of not exceeding twenty-four hectares of agricultural land of the public
domain."20
A person who is legally qualified has to file his application for a homestead patent with the
Bureau of Lands. If in order, the application shall be approved by the Director. The applicant
will be authorized to enter the land upon payment of an entry fee of five pesos. 21 Within six
months after approval of the application, the applicant has to improve and cultivate the
land.22 He must cultivate at least one-fifth of the land for a period of not less than two years
nor more than five years from the date of approval of the application. 23 He must also
continuously reside in the same municipality where the homestead is located, or in an
adjacent municipality, for at least one year. 24 He must finally present his final proof to the
Bureau of Lands that he has complied with the cultivation and residency requirements. 25
It bears emphasis that Act No. 2874 requires that for an application to be valid, it must be
approved by the Director of Lands. This is expressly mandated by Section 13 of the law, viz:
"Sec. 13. Upon filing of an application for a homestead, the Director of Lands, if he finds
that the application should be approved, shall do so and authorize the applicant to take
possession of the land upon the payment of ten pesos, Philippine currency, as entry fee.
Within six months from and after the date of the approval of the application, the applicant
shall begin to work the homestead, otherwise he shall lose his prior right to the
land."26 (emphasis supplied)
This provision gives the Director of Lands discretion to approve or deny an application. He is
not a mere automaton who must perfunctorily approve an application upon its filing. He is
tasked to satisfy himself that, among others, the application papers meet the requirements of
the law, the land is a disposable public land, and the land is not subject of a previous valid
application.27 Only when he finds the application sufficient in form and substance should he
favorably act on it. Otherwise, he should deny it.
The application of Fermin unfortunately remained unacted upon up to the time of his death. It
was neither approved nor denied by the Director, as the Bureau failed to process it. Hence,
he could not have acquired any vested rights as a homestead applicant over the
property because his application was never acted upon.
Reliance on the cases of Davao Grains, Inc. v. IAC28 and Balboa v. Farrales29 by the
petitioners is misplaced. Those two had different factual backdrops. In both Davao Grains,
Inc. and Balboa, the disputed lots were subject of valid applications for public land grants.
The valid applications became our bases for ruling that once an applicant has complied with
the cultivation, residency and other requirements of Act No. 2874, which entitle him to a
patent for a particular tract of land, "he is deemed to have already acquired by operation of
law not only a right to a grant, but a grant of the government for it is not necessary that a

certificate of title be issued in order that said grant may be sanctioned by the courts an
application therefor being sufficient under the provisions of Section 47 of Act No. 2874." 30
A valid application is sadly lacking in the case of Fermin. This circumstance prevented him
from acquiring any vested right over the land and fully owning it at the time of his
death. Conformably, his heirs did not inherit any property right from him.31
Had the application of Fermin been duly approved, his heirs would have succeeded him in his
rights and obligations with respect to the land he has applied for. Sec. 103 of Act No. 2874
covers such a contingency, thus:
"Sec. 103. If at any time the applicant or grantee shall die before the issuance of the patent
or the final grant of the land, or during the life of the lease, or while the applicant or grantee
still has obligations pending towards the Government, in accordance with this Act, he shall be
succeeded in his rights and obligations with respect to the land applied for or granted or
leased under this Act by his widow, who shall be entitled to have issued to her the patent or
final concession if she shows that she has complied with the requirement therefore, or in case
he has left no widow or the widow refuses the succession, he shall be succeeded by the
person or persons who are his heirs by law and who shall be subrogated in all his rights and
obligations for the purposes of this Act." 32
The failure of the Bureau of Lands to act on the application of Fermin up to the time of his
death, however, prevented his heirs to be subrogated in all his rights and obligations with
respect to the land applied for.
Perforce, at the time Hermogenes applied for a homestead grant over the disputed property,
it was still part of alienable public land. As he applied for it in his own name, his application
inures to his sole benefit. After complying with the cultivation and residency requirements, he
became a grantee of a homestead patent over it, thereby making him its absolute and
exclusive owner.33
Petitioners, however, claim that Hermogenes and his heirs, respondent Lopezes, recognized
their rights as co-owners of the disputed property, as shown by the following documents: an
Extra-judicial Partition of the real property executed by Hermogenes and his brothers
petitioner Eleuterio, Nazario, and Juan ;34 a Special Power of Attorney to sell the lot in question
executed by petitioner Eleuterio, Nazario and Juan in favor of Hermogenes; 35 and a letter
dated January 16, 1984, which contains the statement that petitioners are co-heirs of the
property, and which respondent Marcelino Lopez signed. 36 Petitioners argue that respondents
are precluded from denying the contents of these documents based on the principle of
estoppel by deed. They add that while only Hermogenes applied for a homestead grant,
nonetheless, there was an agreement among the brothers that his application was for and in
behalf of all them.
These arguments fail to impress. Estoppel by deed is a bar which precludes one party from
asserting as against the other party and his privies any right or title in derogation of the deed,
or from denying the truth of any material facts asserted in it. 37 The principle is that when a
man has entered into a solemn engagement by deed, he shall not be permitted to deny any
matter which he has asserted therein, for a deed is a solemn act to any part of which the law
gives effect as the deliberate admission of the maker. 38 It promotes the judicious policy of
making certain formal documents final and conclusive of their contents. 39
A void deed, however, will not work, and may not be the basis of, an estoppel. 40 Covenants do
not work an estoppel unless the deed in which they are contained is itself a valid
instrument.41 In the case at bar, the deed and instruments at issue were void. The extrajudicial partition and the special power of attorney to sell did not have an object certain,
which is the subject matter of the deed. The disputed land cannot be their object because
petitioners do not have any right or interest over it. They are not its co-owners as it is owned
absolutely by Hermogenes. Well to note, the two instruments were executed on the mistaken

assumption that Hermogenes and his brothers inherited the property from Fermin. Moreover,
at the time the documents were made, Hermogenes was unaware that he was granted a
homestead patent. As correctly ruled by the appellate court, estoppel does not operate to
confer property rights where there are none. 42
Apropos the letter dated January 16, 1984,43 suffice it to state that we agree with the trial
court's pronouncement that respondent Marcelino Lopez signed it merely "to gain the favors
of his uncle Eleuterio Lopez and in no way does it constitute an admission that the plaintiffs
(petitioners herein) are co-owners of the property." 44 Under these circumstances, respondents
cannot be held guilty of estoppel by deed.
The claim of the petitioners that Hermogenes filed the application in behalf of all the heirs of
Fermin pursuant to a previous agreement does not hold water. There is paucity of evidence in
support of this allegation. Aside from the uncorroborated testimony of petitioner Eleuterio,
petitioners were not able to present other proof of the agreement. Besides, we cannot easily
give credence to such a claim considering that under Act No. 2874, an applicant must
personally comply with the legal requirements for a homestead grant. He must possess the
necessary qualifications. He must cultivate the land and reside on it himself. It would be a
circumvention of the law if an individual were permitted to apply "in behalf of another," as the
latter may be disqualified or might not comply with the residency and cultivation
requirements.
In respect of the fourth assigned error, we find that petitioners' attack on the authenticity and
validity of the Deed of Absolute Sale dated September 12, 1958, where petitioner Eleuterio,
Juan, and Nazario allegedly sold their share in the disputed property to Hermogenes, bereft of
merit. It did not change the fact that no co-ownership existed among Hermogenes and his
brothers. Hermogenes is the absolute owner of the disputed property just as his brothers do
not own any share in it. Hence, they cannot validly sell anything to Hermogenes by virtue of
the deed.
Prescinding from the lack of co-ownership, petitioners' argument that they are entitled to
have the land partition must be rejected. Partition, in general, is the separation, division and
assignment of a thing held in common among those to whom it may belong. 45 The purpose of
partition is to put an end to co-ownership. 46 It seeks a severance of the individual interests of
each co-owner, vesting in each a sole estate in specific property and giving to each one a
right to enjoy his estate without supervision or interference from the other. 47 Not being coowners of the disputed lot, petitioners cannot demand its partition. They do not have any
interest or share in the property upon which they can base their demand to have it divided.
Petitioners' last argument that they are not guilty of laches in enforcing their rights to the
property is irrelevant. Laches is the negligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to assert it has abandoned
it or declined to assert it.48 It does not involve mere lapse or passage of time, but is principally
an impediment to the assertion or enforcement of a right, which has become under the
circumstances inequitable or unfair to permit. 49 Petitioners' insistence that they are not
negligent in asserting their right over the property proceeds from the wrong premise that
they have a right to enforce over the disputed property as co-owners. There can be no delay
in asserting a right where the right does not exist.
IN VIEW WHEREOF, finding no cogent reason to reverse the impugned Decision of the Court
of Appeals, the petition is DENIED for lack of merit.
SO ORDERED.

G.R. No. L-14634

January 28, 1961

ARTURO NIETO, plaintiff-appellant,

vs.
BARTOLOME QUINES and MIGUEL P. PIO, defendants-appellees.
Justiniano P. Cortez for plaintiff-appellant.
Miguel P. Pio for defendants-appellees.
GUTIERREZ DAVID, J.:
Sometime in 1917, Bartolome Quines filed with the Bureau of Lands a homestead application
covering a tract of land situated in the municipality of Abulug, province of Cagayan. Upon the
approval of his application in the following year, he began clearing and cultivating the land.
In the years 1923 to 1925, cadastral surveys were made by the Bureau of Lands in the
municipality of Abulug, during which the tract of land applied for as a homestead by
Bartolome Quines was designated as Lot No. 3044 of the Abulug Cadastre. After the surveys
were completed, cadastral proceedings were initiated in 1927 by the Director of Lands in the
Court of First Instance of Cagayan. Relying upon the assurances made by the employees of
the Bureau of Lands that they would take care of his homestead in the cadastral proceedings,
Bartolome Quines did not file any answer therein. However, one Maria Florentino filed an
answer claiming several lots including Lot No. 3044. After hearing, the cadastral court, on
August 16, 1930, rendered its decision wherein Maria Florentino was awarded the lots claimed
by her. Lot No. 3044 was included in the award, apparently because neither the Director of
Lands nor any of his representatives appeared during the hearing to inform the court that it
was under homestead application. On August 29, 1930, pending the issuance of the final
decree of registration and the original certificate of title to Maria Florentino, a homestead
patent covering Lot No. 3044 was granted to Bartolome Quines, and pursuant thereto, the
Register of Deeds of Cagayan, on September 15, 1930, issued Original Certificate of Title No.
623 in his name. Six months thereafter, or on March 12, 1931, the same Register of Deeds
issued Original Certificate of Title No. 11982 in the name of Maria Florentino covering the lots
awarded to her by the cadastral court including Lot No. 3044.
Sometime in 1952, Maria Florentino, with the consent of her husband Jose Villanueva, sold all
the lots covered by Original Certificate of Title No. 11982 to Arturo Nieto, who subsequently
secured the issuance of Transfer Certificate of Title No. 1402 in his name on January 21, 1953.
On other hand, Bartolome Quines executed a deed of sale on December 23, 1953 transferring
Lot No. 3044 as covered by Original Certificate of Title issued in his name to Atty. Miguel P.
Pio. Discovering that the land he purchased was covered by another title in the name of
Arturo Nieto, Atty. Pio, on January 8, 1954, filed an action against the latter in the Court of
First Instance of Cagayan for quieting of title. The lower court, however, upon defendant's
motion, dismissed the action on the ground that the plaintiff had not yet acquired a legal title
that could affect third persons, the sale not having approved by the Secretary of Agriculture
and Natural Resources and the deed not being registered in the office of the Register of
Deeds.
Prior to the dismissal of the action to quiet title above mentioned, or on January 16, 1954,
Arturo Nieto, the defendant therein, filed a complaint against Bartolome Quines in, the Court
of First Instance of Cagayan. The complaint alleging, among other things, that the homestead
patent and Original Certificate of Title No. 623 were obtained through fraud and
misrepresentations, prayed that the patent and title be cancelled and that Transfer Certificate
of Title No. 1402 issued in plaintiff's name be declared as the true and valid title over the lot
in dispute. It was likewise alleged that defendant Quines was not in possession of Lot No.
3044, but of certain portions of other lots belonging to plaintiff, and should, therefore, be
ordered to vacate the same. Defendant Bartolome Quines, through his counsel Atty. Miguel P.
Pio, answered the complaint denying its material allegations.

During the pendency of the action, the sale of Lot No. 3044 to Miguel P. Pio was approved by
the Secretary of Agriculture and Natural Resources and was later registered in the office of
the Register of Deeds of Cagayan who issued Transfer Certificate of Title No. 1994 in the
name of Miguel P. Pio. Accordingly, Miguel P. Pio filed a motion for his inclusion as party
defendant. His motion having been granted, defendant Miguel P. Pio answered the complaint
denying the material allegations thereof and interposing a counterclaim for damages.
After trial, the lower court rendered judgment in defendants' favor dismissing the complaint,
ordering the cancellation of Original Certificate of Title No. 11982 and Transfer Certificate of
Title No. 1402 insofar as they cover Lot No. 3044, and sentencing the plaintiff to pay the
defendants P6,000 representing the owner's share in the harvest from the years 1954 to
1957. His two motions for reconsideration having been denied, plaintiff Arturo Nieto appealed
directly to this Court.
The appeal is without merit.
As established during the trial and found by the trial court, Bartolome Quines had been in the
continuous and peaceful possession of Lot No. 3044 from the time his homestead application
was approved in 1918 up to 1953 when he was forcibly ejected therefrom by Arturo Nieto. As
a homestead applicant, he religiously complied with all the requirements of the Public Land
Act and, on August 29, 1930, a homestead patent was issued in his favor. Considering the
requirement that the final proof must be presented within 5 years from the approval of the
homestead application (sec. 14, Public Land Act), it is safe to assume that Bartolome Quines
submitted his final proof way back yet in 1923 and that the Director of Lands approved the
same not long thereafter or before the land became the subject of the cadastral proceedings
in 1927. Unfortunately, there was some delay in the ministerial act of issuing the patent and
the same was actually issued only after the cadastral court had adjudicated the land to Maria
Florentino. Nevertheless, having complied with all the terms and conditions which would
entitle him to a patent, Bartolome Quines, even without a patent actually issued, has
unquestionably acquired a vested right on the land and is to be regarded as the equitable
owner thereof. (Balboa vs. Farrales, 51 Phil. 498). Under these circumstances and applying by
analogy the principles governing sales of immovable property to two different persons by the
same vendor, Bartolome Quines' title must prevail over that of Maria Florentino not only
because he had always been in possession of the land but also because he obtained title to
the land prior to that of Maria Florentino.
Having arrived at the above conclusions, we deem it idle to consider the other points raised in
this appeal.
IN VIEW OF THE FOREGOING, the decision appealed from is hereby affirmed. With costs
against appellant.
Bengzon, Padilla, Bautista Angelo, Labrador and Paredes JJ., concur.
Reyes, J.B.L., J., concurs in the result.
Concepcion and Barrera, JJ., reserve their votes.

G.R. No. L-50685 December 4, 1991

ROBERTO AGURA, CESAR ALIB, TOMAS STA. RITA, ALFREDO CORDOVA, VICTOR DE
LOS REYES, and MARINA SERFINO, petitioners,
vs.
FEDERICO SERFINO, SR., FEDERICO SERFINO, JR., The Honorable RONALDO B.
ZAMORA, Presidential Assistant for Legal Affairs, Office of the President; The
Honorable JOSE J. LEIDO, JR., Minister of the Department of Natural Resources, and
The Court of First Instance of Manila, Branch XXI, respondents.
Francisco B. Cruz and Gruba, Tanlimco, Lamson & Burgos for petitioners.

DAVIDE, JR., J.:

In this petition for review on certiorari, petitioners seek to nullify the decision dated 30 April
1979 of the then Court of First Instance (now Regional Trial Court) of Manila, Branch XXI, in
Civil Case No. 113897, which affirmed the decisions of the Presidential Assistant for Legal
Affairs and the then Minister of Natural Resources giving due course to the Miscellaneous
Sales Applications filed by private respondents with the Bureau of Lands.
The relevant factual and procedural antecedents which gave rise to this petition as gathered
from the pleadings are as follows:
On 10 December 1965, private respondent Federico Serfino, Sr., filed with the Bureau of
Lands Miscellaneous Sales Application (MSA) No. (V-3)2 over a 4,172 square meter parcel of
land located at San Patricia Bacolod City. On 18 February 1966, his son, respondent Serfino,
Jr., filed MSA No. (V-3)1 over an adjoining lot with an area of 1,358 square meters.
Subsequently, the Director of Lands approved the survey plans of these two (2) MSAs.
On 21 February 1966, Land Investigator Rodolfo Magbanua conducted a preliminary
investigation of the parcels of land covered by the above MSAs. He reported that Serfino, Sr.
had introduced improvements consisting of a residential house, a piggery house and a
bodega all valued at P25,500.00; Serfino, Jr. had introduced an improvement consisting of a
residential house valued at P15,000.00; and that they have been occupying the parcels
applied for since 1947. Magbanua recommended that the MSAs be given further due course.
The MSAs were referred to the Director of Public Works, the Commissioner of Public Highways,
the Bacolod City Engineer and the Bacolod City Collector of Customs. These officials did not
interpose any objections. The Director of Lands approved the surveys of the parcels applied
for on 26 July 1966.
On 28 September 1967, notices for the sale through public auction of the lots in question
were posted at the required places and published in the 13 and 20 November 1967 issues of
the Official Gazette. The auction sale was set for 27 December 1967 at 10:00 o'clock in the
morning. The Undersecretary of Natural Resources pegged the price of the lots in question at
P5.00 per square meter.
At the auction sale, private respondents were the only qualified bidders. Serfino, Sr.'s bid was
P20,860.00 while that of Serfino, Jr.'s was P6,790.00. They paid the required 10% of their
respective bids. While the purchase price and the corresponding annual real estate taxes
have already been fully paid, the Bureau of Lands has yet to issue an Order awarding the lots
in question to them.
On 11 March 1968, District Land Officer Pedro C. Reyes ordered an investigation of an alleged
conflict (docketed as D.L.O Conflict No. (V-3)220 (N)) between Serfino, Sr.'s MSA No. (V3)2 and

that of an unnumbered Revocable Permit Application (VRAP) of a certain Primitive Donozo. On

2 April 1968, another investigation of an alleged conflict (docketed as B.L. Conflict No. 217(N))
between Serfino, Jr.'s MSA No. (V-3)1 and the RPAs of petitioners Agura, Alib, and Sta. Rita and
a certain Domingo Natividad was ordered.
Land Investigator Ernesto Siriban conducted a preliminary investigation of B.L. Conflict No.
217(N). In his report dated 2 April 1968, he stated:
That the land subject hereof used to be foreshore but is now dryland and is being used for
residential purposes by the party litigants and their respective tenants and relatives;
That upon verification of the premises, it was found out that the area applied for and occupied
by the Applicants-Contestants are inside the area applied for and surveyed for the ApplicantRespondent ...1
In his report, Siriban made no mention of D.L.O. Conflict No. (V-3)220(N). He advised the
contending parties in B.L. Conflict No. 217(N) to submit to a formal investigation so that their
respective claims can be threshed out.
A formal investigation was then conducted by Ramon Villamarzo of the Bacolod City District
Land Office. Three (3) formal hearings were held in May, June and 19 September 1969.
Unfortunately, however, Villamarzo failed to submit either the stenographic notes or the
report on what transpired during these hearings, except the one held on 19 September 1969
wherein he stated that for failure of herein respondents to appear, he had to reset the
hearings of 27, 28, and 29 of November 1969.
Meanwhile, petitioners Agura, Alib, Sta. Rita and 106 others sent to the President of the
Philippines a petition dated 22 August 1969 requesting that the small parcels of land located
in the areas covered by private respondents' MSAs which they have been occupying for thirty
(30) years be awarded to them. In view of this petition, Regional Land Officer Cipriano Zabala
of Region V, Iloilo City was ordered to conduct an investigation. On 13 October 1969, Zabala
submitted the following preliminary report:
The land subject of the present controversy is now a dry land which has been formed by
accretions from the sea (Guimaras strait) for many, many years. It could not be reached
anymore by sea water during ordinary high tide. The land is between the Bacolod Cadastre on
the east and foreshore area on the west.
About 314 of the land in question extending towards the south was surveyed under approved
survey plans msi-(V-3)3-D in the name of Federico Serfino, Sr. and Serfino, Jr. The remaining
1/4 portion of the land in question is not covered by an approved survey plan and is being
claimed by Mr. Serfino, Sr.
The Serfinos have houses on the land in question. Likewise, all other portions of the said in
question are covered with houses mostly of nipa roofing and of light materials belonging to
the petitioners. There is an well now being used by the people therein. Several old coconut
trees are found in the area and the consensus of the People with me (including Atty. Drilon, Jr.,
Serfino Sr. and Barrio Captain Deoma) is that these coconut trees have been planted by
Candido Cordova and/or his predecessors, owners of a cadastral lot not very far south of the
land in question. 2
On 3 December 1969, Zabala submitted a "final" report:
As stated in my progress report dated October 13, 1969, transit and stadia sketching of the
area in question was made by Surveyor I Ponciano Bautista of the Bacolod City District Land
Office. Enclosed herewith, marked as Annex "J" is a sketch tracing plan prepared therefor.
From the herein sketch plan, the fint lot on the south is that covered by M.S.A. No. (V-3)1 of
Federico Serfim, Jr. with an area of 1,358 squam meters. There are thirty four (34) persons
(petitioners) with houses therein very close to each other occupying the area. Someof these

houses are indicated on the tracing plan. The site of the proposed artesian well to he
constructed is also indicated and circled with red ink on the sketch.
The sand lot involved in this case with an area of 4,172 square meters is the one applied for
by Federico Serfino, Sr. Aside from the residential house of the Serfinos and the bodega (of)
the West Visayan Shipping Co., there are thirty-eight (38) houses also close to each other of
the petitioners. Some of these houses are indicated on the sketch.
xxx xxx xxx
The third lot on the north is not covered by any public land application by the Serfinos as
verified from the records in the District Land Office at Bacolod City. The area is approximately
3,650 square meters. There are fifty-eight (58) houses of the petitioner(s) within the lot all
close to each other. Some of the houses are indicated on the sketch. The site of another
artesian well proposed to be constructed by the petitioners is marked and circled in red ink. 3
Zabala likewise stated in his report that three (3) ejectment cases (Civil Cages Nos. 6633,
6534, and 6674) were filed with the City Court of Bacolod by private respondents against
certain individuals including petitioners herein. He recommended that, in view of these
pending cases, further action on private respondents MSAs be held in abeyance.
On 7 January 1970, the City Court of Bacolod rendered decision in Civil Case No. 6533
ordering the ejectment of the defendants therein from the lots in question for "failure to pay
rentals." On 22 August 1970, Civil Cases Nos. 6534 and 6674 were dismissed on the ground
that "the question of who has a better right to the areas claimed by the parties will be
determined by the Bureau of Lands who (sic) has charge of the disposal of public lands." 4
On 10 February 1971, Land Investigator Villamarzo submitted a report recommending that the
petitioners herein be given "preferential right" over the portions occupied by them. Acting on
this recommendation, the Director. of Lands on 6 July 1971 issued an Order, the dispositive
part of which reads:
WHEREFORE, it is ordered that the Miscellaneous Sales Applications No. (V-3)2 and (V-3)1 of
Pederico Serfino, Sr. and Federico Serfino, Jr., respectively, be, as hereby they are, amended
by excluding therefrom the portions occupied by the petitioners, and as thus amended said
applications shall be given due course for the re portions after they are surveyed at the
applicant's own expense. The excluded portions shall be subdivided into home-sized lots in
accordance, as much as possible, with the actual occupation of the petitioners who shall,
thereafter, be required to file appropriate public land applications therefor. 5
On 7 August 1971, private respondents moved for a reconsideration alleging that they were
not given the opportunity to introduce evidence in their behalf. On 16 August 1974, the
Assistant Director of Lands denied the motion stating, inter alia, that:
Records also disclosed that the proceedings in the City Court of Bacolod in the aforesaid civil
cases were adopted during the investigation of the above-noted case conducted by a
representative of this office. Thus, the records of the transcript of stenographic notes taken
down during the hearing in the two (2) aforesaid civil cases are attached to the record of this
case as part hereto.
Records further show that the petitioners-claimants are in actual possession of the portions
respectively claimed by them. The foregoing facts and circumtances have clearly established
that the petitioners-claimants have preferential right to the portions they actually occupy. 6
On appeal by herein private respondents, the Secretary of Natural Resources set aside the
foregoing orders in a decision dated 7 October 1976, the dispositive part of which reads:
WHEREFORE, the Order of the Director of Lands dated July 6, 1971, is hereby SET ASIDE, and
the appellees are hereby ordered to vacate the two lots in question within thirty (30) days

from receipt of their copies of the decision hereof and leave the appellants in peaceful
possession of the same. Accordingly, the Miscellaneous Sales Application No. (V-3)1 of
appellant Federico Serfino, Jr. and Miscellaneous Sales Application No. (V-3)2 of appellant
Federico Serfino, Sr. shall be given further due course.7
In support of this disposition, the Secretary made the following findings of facts and
conclusions:
The principal issue is whether or not the sales of the lots in question in favor of the appellants
(private respondents) should be revoked in view of the alleged conflicts and adverse claims of
the appellees (petitioners).
We find no basis for an affirmative answer to this issue considering that the basic facts remain
uncontroverted.
The records show that the required notices were posted in accordance with law on September
28,1967, at the required places for the sale through public auction of the lots in question on
December 27, 1967. The notices were likewise published in the Official Gazette on November
13, 1967, and on November 20, 1967. On December 27, 1967, no other bids having been
admitted, except those of the appellants, their bids were accepted. Since then, the appellants
have fully paid the amounts respectively bedded by them: P20,860.00 for Federico Serfino,
Sr., and P6,790.00 for Federico Serfino, Jr. Appellants have also declared the said lots for
taxation purposes with the City Assessor of Bacolod and have been religiously paying their
taxes thereon.
Ordinarily, the Order of award and the corresponding authority to enter follow. But no such
order of award in favor of the appellants has yet been issued. Were there supervening events
that could have prevented the Bureau from giving the award to the appellants? If so, did
these supervening events constitute a bar to an award of the contested lots?
From the records of this case, there were allegedly two supervening events. First, there were
the alleged conflicts between the Miscellaneous Sales Applications of the appellants and
Revocable Permit Applications of the five appellees. The second were the adverse claims of
these five appellees and 105 others filed on August 22, 1969.
Under Land Administrative Order No. 6, a conflict refers to a protest made by a public land
applicant who believes that another applicant or any other person is encroaching upon the
land applied for by him. In other words, it is essential that the protestant must be a public
land applicant. Appellees never filed any regular land application. They did, however, file
revocable permit applications, but these were never approved by the Bureau of Lands as
reflected in the questioned Order of the Director of Lands. ... The appellees therefore have not
acquired any right whatsoever over the Iota in question. Beside (sic) such mere filing did not
create an obligation on the part of the Bureau of Lands to grant their applications. ... It is
discretionary on the part of said officials to grant or not to grant such applicants. (Aureus vs.
Secretary of Agriculture and Natural Resources, 85 Phil. 1, November 11, 1949).
The case took on a different aspect when the five applees and 105 others sent a letter-protest
to the President of the Philippines on August 22, 1969, requesting that the contested areas,
which they have allegedly occupied for more than thirty (30) years, be awarded to them. This
was done even while the formal investigation before Villamarzo on the alleged conflicts will
still pending. In fact, no investigation at all was ever done by Villamarzo. In effect, the
appellees turned the alleged conflicts into adverse claims.
Again under Lands Administrative Order No. 6, an adverse claim refers to the verified protest
filed whereby a person asserts a right over a land covered by a public land application, based
on his alleged ownership or on his prior right to apply for the same.
Obviously, appellees cannot base their adverse claim on the ground of ownership once the
contested lots belong to the public domain. Well settled is the rule that no public land can be

acquired by private persons without a grant, express or implied, from the Government (Padilla
vs. Reyes, 60 Phil. 967), ... However, a mere allegation by the appellees that they have been
in occupation of certain portions of the public domain for more than 30 years is not sufficient
to confer ownership on (sic) said public lands.
xxx xxx xxx
Appellees herein failed to protest when the appellants filed their respective sales applications.
Neither did they protest when the land was surveyed nor did they contest or participate in the
public bidding. Appellees took nearly two years after the bidding to file their alleged adverse
claims.
The basic facts remain. The Bureau decided to sell the contested lots through public auction.
And the public bidding was indeed held. Prior possession is immaterial. In proceedings for the
sale of public lands for residential purposes, adjudication shall be made to the highest
bidder. ...
Appellants herein have substantially complied with the sales provisions of the Public Land Act,
whereas the appellees failed to exercise their rights when they did not participate in the
public bidding. They therefore could not invoke preferential right over the contested lots
under Section 95 of the Public Land Act since the lots were already regularly sold at public
auction in favor of the appellants. 8
On appeal by herein petitioners, the Presidential Assistant for Legal Affairs on 20 September
1977 affirmed in totothe foregoing decision.
In affirming the Secretary's decision, the Office of the President held as without merit the
contentions of petitioners that the land in question is foreshore and cannot therefore be
disposed of by sale but only by lease pursuant to Section 61, in relation to Section 59 of the
Public Land Act, and that if at all it could be disposed of by sale, purchasers are limited to
1,000 square meters pursuant to R.A. No. 730, and that the decision appealed from renders
nugatory the social justice policy of the New Society as it would result in the eviction and
dislocation of more than 100 occupants of the area who have been there for more than thirty
(30) years. The order of the Director of Lands of 6 July 1971 favoring the petitioners
characterized the land as having been formed by accretion from the sea, hence it is not
foreshore land. The sales in question were perfected by public auction, held and conducted
pursuant to Section 60, in relation to Section 26 of the Public Land Act, and not through
private sales; hence, R.A. No. 730 has no application. As to the third contention, the Office of
the President concluded that from the facts established, the petitioners were able to enter the
land after the Serfinos purchased the land by public bidding. The social justice policy of the
New Society does not condone, much less countenance, entry upon public lands already
applied for and purchased at public auction; otherwise, it would be placing a premium on
squatting. 9
Petitioners' motion for reconsideration of the above decision having been denied, they filed
with the respondent trial court a special civil action for certiorari and asked for the
nullification of the decisions of the Presidential Assistant for Legal Affairs and the Secretary of
Natural Resources. On 30 April 1979, the trial court 10 affirmed the questioned decisions and
dismissed the petition. 11
On 20 July 1979, petitioners filed the petition at bar. 12
Petitioners urge Us to reverse the decision of the trial court because it erred:
I
... IN NOT DECLARING THAT THE FINDINGS OF THE RESPONDENTS PUBLIC OFFICIALS WERE
MADE WITH ARBITRARINESS AND WITH GRAVE ABUSE OF DISCRETION.

II
... IN REFUSING TO REVIEW, AND IN BASING ITS DECISION ON, THE FINDINGS OF FACT OF THE
RESPONDENT PUBLIC OFFICE.
III
... IN NOT HOLDING THAT SEC. 1 OF RA. NO. 730 HAS AMENDED THE PROVISIONS OF SECS. 61
AND 67 OF THE PUBLIC LAND ACT REGARDING THE SALE OF PUBLIC LANDS FOR RESIDENTIAL
PURPOSES TO BONA FIDE OCCUPANTS.
IV
... IN NOT HOLDING THAT THE SALE TO THE RESPONDENTS SERFINOS AT PUBLIC AUCTION OF
MORE THAN 1,000 SQUARE METERS OF RESIDENTIAL PUBLIC LAND VIOLATED THE
PROVISIONS OF R.A. NO. 730 AND IS THEREFORE VOID.
We required the respondents to comment 13 on the petition which public respondents
complied with on 31 August 1979,14 and private respondents on 12 October 1979.15 A Reply
was subsequently filed by the petitioners. On 13 February 1980, this Court gave due course to
the petition 16and the parties consequently filed their Briefs.
The petition is devoid of merit.
Decisive of the first and second assigned errors is the rule We enunciated in Pajo, et al. vs.
Ago, et al ., 17 thus:
In the case of Espinosa, et al. vs. Makalintal, et al. [79 Phil. 134; 45 Off. Gaz. 7121 we held
that the powers granted to the Secretary of Agriculture and Commerce (Natural Resources) by
law regarding the disposition of public lands such as granting of licenses, permits, leases, and
contracts or approving, rejecting, reinstating, or cancelling applications, or deciding
conflicting applications, are all executive and administrative in nature. It is a well-recognized
principle that purely administrative and discretionary functions may not be interfered with by
the courts [Coloso vs. Board of Accountancy, 92 Phil. 938 and cases therein cited]. In general,
courts have no supervising power over the proceedings and actions of the administrative
departments of the government. This is generally true with respect to acts involving the
exercise of judgment or discretion, and findings of fact [54 Am. Jur. 558-559]. Findings of fact
by an administrative board or officials, following a hearing, are binding upon the courts and
will not be disturbed except where the board or official has gone beyond his statutory
authority, exercised unconstitutional powers or clearly acted arbitrarily and without regard to
his duty or with grave abuse of discretion. And we have repeatedly held that there is grave
abuse of discretion justifying the issuance of the writ of certiorari only when there is
capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction [Abad
Santos vs. Province of Tarlac, 67 Phil. 480; Tan vs. People, 88 Phil. 6091, as where the power is
exercised in an arbitrary or despotic manner by reason of passion, prejudice, or personal
hostility amounting to an evasion of positive duty, or to a virtual refusal to perform the duty
enjoined, or to act at all in contemplation of law [Tavera-Luna, Inc. vs. Nable, 67 Phil. 340;
Alafriz vs. Nable, 72 Phil. 278; Liwanag vs. Castillo, 106 Phil. 375; 57 Off. Gaz. [111 (1962)]. ...
and reiterated in many cases, among which is Lacuesta vs. Herrera.18
In Lacuesta vs. Herrera, this Court categorically declared:
The petition must therefore be granted on the strength of the established doctrine that where
as in this case at bar there is no showing that there was fraud, collusion, arbitrariness,
illegality, imposition or mistake on the part of the Office of the President or a department
head, (such as the Secretary of Agriculture and Natural Resources in the present case), in
rendering their questioned decisions or of a total lack of substantial evidence to support the

same, such administrative decisions are entitled to great weight and respect and will not be
interfered with by the courts.
In the instant case, both the Secretary of Natural Resources and the Office of the President
made a thorough and painstaking analysis and evaluation of the facts and their respective
decisions are clearly supported by substantial evidence. There is nothing in their actuations
that would bring their findings and decisions within the above exceptions to the principle of
conclusiveness of finding of facts of administrative bodies. Accordingly, the trial court, which
nevertheless patiently and carefully summarized the facts, did not commit the first and
second alleged errors.
The third and fourth assigned errors are likewise untenable.
We agree with the ruling of the respondent court that R.A. No. 730 does not repeal or amend
Sections 61 and 67 of C.A. No. 141 (The Public Land Act); it merely establishes an exception
to said sections.
Section 61 of the Public Land Act provides:
The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be disposed of to
private parties by lease only and not otherwise, as soon as the President, upon
recommendation by the Secretary of agriculture, shall declare that the same are not
necessary for the public service and are open to disposition under this chapter. The lands
included in class (d) may be disposed of by sale or lease under the provisions of this Act.
Section 67 provides:
The lease or sale shall be made through oral bidding, and adjudication shag be made to the
highest bidder, However, where an applicant has made improvements on the land by virtue of
a permit issued to him by competent authority, the sale or lease shall be made by sealed
bidding as prescribed in section twenty-six of this Act, the provisions of which shall be applied
wherever applicable. If all or part of the lots remain unleased or unsold, the Director of Lands
shall from time to time announce in the Official Gazette or in any other newspapers of general
circulation, the lease or sale of those lots if necessary.
Section 59 reads:
The lands disposable under this title shall be classified as follows:
a) Lands reclaimed by the Government by dredging, filling, or other means;
b) Foreshore;
c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable
lakes or rivers;
d) Lands not included in any of the foregoing classes.
The land in question belongs to class (d).
On the other hand, Section I of Republic Act No. 730 ("An Act To Permit The Sale Without
Public Auction of Public Lands Of The Republic Of The Philippines For Residential Purposes To
Qualified Applicants Under Certain Conditions") provides that:
Notwithstanding the provisions of sections sixty-one and sixty seven of Commonwealth Act
Numbered One Hundred Forty-one, as amended by Republic Act Numbered Two Hundred
Ninety-three, any Filipino citizen of legal age who is not the owner of a home lot in the
municipality or city in which he resides and who has in good faith established his residence on
a parcel of the public land of the Republic of the Philippines which is not needed for the public
service, shall be given preference to purchase at a private sale of which reasonable notice
shall be given to him not more than one thousand square meters at a price to be fixed by the
Director of the Lands with approval of the Secretary of Agriculture and Natural Resources. It

shall be an essential condition of this sale that the occupant has constructed his house on the
land and actually resided therein. Ten percent of the purchase price shall be paid upon the
approval of the sale and the balance may be paid in full, or in ten equal annual installments.
while Section 3 reads:
The provisions of the Public Land Act with respect to the sale of lands for residential purposes
which are not inconsistent herewith shall be applicable.
From the title alone of R.A. No. 730, it is quite obvious that indeed, as seen by the respondent
court, it merely provides an exception to Sections 61 and 67 of C.A. No. 141. We quote with
approval the pertinent portions of the disquisition of the respondent court, thus:
The contention of the petitioners that the sale to the Serfinos is void because under Rep. Act
No. 730 public land for residential purposes must be sold by private sale and for not more
than 1,000 square meters is not meritorious either. Sec. 59 of commonwealth Act No. 141 has
classified public lands which can be sold for residential, commercial, or industrial purposes
into: (a) lands reclaimed by the government; (b) foreshore; (c) marshy lands; and (d) lands
not included in any of the foregoing classes. Under Sec. 60 of the Act, these public lands may
be leased or sold to any person qualified to purchase public lands for agricultural purposes,
provided that the area shall not exceed 144 hectares, as may be determined by the Secretary
of Agriculture and Natural Resources. Under See. 61, the lands under (a), (b) and (c)
classifications can be disposed of-by lease only, while those under (d) classification may
either be leased or sold, Sec. 67 provides that the lease or sale shall be made by oral bidding
to the highest bidder. Secs. 61 and 67 of Commonwealth Act No. 141 were amended by Rep.
Act No. 730 in the following manner:
xxx xxx xxx
The petitioners contend that after the passage of Rep. Act No. 730, the sale of public lands for
residential purposes has been limited to 1,000 square meters only, and that the sale must be
effected by private sale only. A close examination of the law cited by the petitioners, however,
shows that it is only applicable when the conditions specified therein are present, i.e., that
preference shall be given to the applicant if he is not the owner of a home lot in the
municipality or city in which he resides; if he has established his residence in good faith on a
parcel of public land, which is not needed for the public services; and if the area applied for
does not exceed one thousand square meters. In other words, Sec. 1 of Rep. Act No. 730 does
not repeal Secs. 61 and 67 of Commonwealth Act No. 141 entirely, but merely establishes an
exception. It does not repeal Sec. 60, either expressly or by implication.
xxx xxx xxx
In short, R.A. No. 730 authorizes a sale by private sale, as an exception to the general rule
that it should be bybidding, if the area applied for does not exceed 1,000 square meters, and
that the applicant has in his favor the conditions specified for in Section 1 thereof. Hence, if
the area applied for is in excess of 1,000 square meters, as in the instant case, the sale must
be done only through bidding.
WHEREFORE, the instant petition is DISMISSED and the decision of the respondent court of 30
April 1979 in Civil Case No. 113897 is AFFIRMED, with costs against petitioners.
IT IS SO ORDERED.
Gutierrez, Jr., Bidin and Romero, JJ., concur.

G.R. No. 83383

May 6, 1991

SOLID STATE MULTI-PRODUCTS CORPORATION, petitioner,

vs.
THE COURT OF APPEALS (Former Sixth Division) and THE INTESTATE ESTATE OF
ANTENOR S. VIRATA and the DEVELOPMENT BANK OF THE PHILIPPINES, respondents.
Antonio M. Chavez for petitioner.
Rodolfo M. Dela Rosa for respondent Intestate Estate of Antenor S. Virata.

MEDIALDEA, J.:
This is a petition for review on certiorari of the decision of the Court of Appeals which affirmed
the decision of the trial court dismissing the complaint filed by petitioner for quieting of title
and declaring Antenor Virata as the true and lawful owner of the disputed property.
The antecedent facts are as follows:
On September 28, 1982, petitioner, a domestic corporation, filed an action for quieting of title
against the respondent estate of Virata alleging that it is the registered owner of a parcel of
land located at Imus, Cavite, with an area of 48,182 sq. meters, covered by Certificate of Title
No. T-80889 of the Register of Deeds of Cavite, which was issued on February 24, 1976; that
Virata, during his lifetime thru the use of fraud, caused the issuance of Certificate of Title No.
T-11520 RT 1660 on September 1, 1959 thru an administrative reconstitution of a nonexistent
original title covering the same parcel of land; that by reason of the said reconstitution and
subsequent issuance of TCT No. T-11520 RT 1660, there now exists a cloud on the title of
petitioner.
As gathered by the respondent appellate court and trial court, the evidence for the petitioner
consists of the following:
Pursuant to the provisions of Act No. 32, as amended, Julian Pearanda submitted with
the Bureau of Lands, thru its District Land Office at Rosario, Cavite an application dated
November 22, 1968, in a verified Indorsement dated November 25, 1968, to purchase
a friar land which was subscribed and sworn to before Manuel Cupino, Acting District
Land Officer (Exh. "D"). The application covers Lot No. 7449 of the Imus Friar Lands
Estate, situated at Barrio Molino, Bacoor, Cavite, containing an area of 4 hectares, 81
ares and 82 centares. Said application was accompanied by a "SALAYSAY" (Exhibit "A")
signed and sworn to by one Mabini Legaspi before said District Land Officer Cupino,
purporting to transfer to, and to waive in favor of, Julian Pearanda, all the rights of
executor to Lot No. 7449.
Following the routine in cases of this nature, District Land Officer Cupino referred to
Land Investigator Alberto Buhain for investigation and in a verified Indorsement dated
November 25, 1968, said investigator made a Report (Exh. "B") on the result of his
investigation, to District Land Officer Cupino, District Land Office No. III-8 Bureau of
Lands, Rosario, Cavite, certifying that applicant Julian Pearanda is the actual occupant
of Lot No. 7449, has introduced improvements consisting of upland rice and other
seasonal crops; that Pearanda's occupation of the land is derived through a voluntary
assignment of right of the former occupant, Mabini Legaspi, and that the same is free
from claims and conflicts and that the said applicant has established his rights over the
subject land, in view of which, said investigator recommended that said lot be awarded
to applicant Julian Pearanda according to law.

Thereafter, the Report having been submitted to Cupino, the latter directed
investigator Buhain to prepare an Information Sheet (Exh. "G" up to "G-3") and Cupino
made the Appraisal Report (Exh. "E-2"). The above requirements having been
accomplished, District Land Officer Cupino forwarded Pearanda's application to the
Director of Lands, thru the Chief, Land Management Division, recommending
disposition of Lot No. 7449 be made in accordance with the findings of his office, to
Julian Pearanda, pursuant to the provisions of C.A. of No. 32, as amended.
By second Indorsement dated December 16, 1968, Higinio P. Sunico, Chief, Land
Management Division, acting for and in behalf of the Director of Lands, forwarded to
the Secretary of Agriculture and Natural Resources, the application of Julian Pearanda,
recommending that Lot No. 7449 be sold to said applicant without public auction for a
sum of P1,198.00 (Exh. "I") and by a 3rd Indorsement dated December 16, 1969, the
application of Julian Pearanda was returned by the Secretary of Agriculture and
Natural Resources, to the Director of Lands, Manila, approving that sale without
auction, to Julian Pearanda, of lot No. 7449. Pursuant to this approval, the Director of
Lands authorized the District Land Officer, Rosario, Cavite, to sell without auction to
Julian Pearanda, and directing that the sales contract should be executed soonest
(Exh- "I"). The Director of Lands and Julian Pearanda executed, therefore, Sales
Contract No. V-447 (Exh. "K"), on February 28, 1969, for a consideration of P1,198.00,
to be paid in ten (10) monthly installments, the first installment of P290.00 having
been paid upon execution of the sales contract and the payment of the P1,198.00 was
fully paid on August 6, 1969 (Exh. "O").
The contract price of the land having been paid by Pearanda, Undersecretary of
Agriculture and Natural Resources Isoceles Pascual, on August 13, 1969, issued the
final deed of conveyance of lot No. 7449 (Exh."8") in favor of Julian Pearanda and the
said deed of conveyance contains the physical and technical description of the lot in
question (See Exh. "S-l").
xxx

xxx

xxx

On the basis of said Deed of Conveyance No. 10431, the Register of Deeds of Cavite
issued on November 14, 1969 in favor of Julian Pearanda TCT No. T-39631 (Exh. "Z-6")
which on its face shows it to have come from a direct transfer from OCT no. 1002, and
on February 17, 1976, the plaintiff, by way of a Deed of Absolute Sale (Exh. "Z") bought
said Lot No. 7449 as a consequence of which, TCT No. T-39631 was cancelled and new
TCT No. T-80889 was issued on February 24, 1976 to the plaintiff, Solid State Multi
Products Corporation.
Plaintiff Solid State Multi-Products Corporation enrolled Lot No. 7449 with the issuance
of Tax Declaration No. 20893 which was superseded by Tax Declaration No. 10973 and
continued to religiously pay the realty taxes as covered by receipts of tax payments
(Exh. for 1977 and Exh. "7-19" for 1984) and the subject property is in its actual
possession since its acquisition from Pearanda up to the present. (pp. 109112,Rollo (Emphasis Ours)
On the other hand, respondent Virata denied the allegations in the complaint and presented
evidence to prove his claim over the land. The appellate court and trial court made the
following findings:
. . . on March 20, 1943, the Director of Lands, Mr. Jose F. Dans, gave authority to sell at
public auction Lot No. 7449 of the Imus Estate, containing an area of 4.8182 hectares
at the price of not less than its appraised value of P290.00 (Exh. X-33). Accordingly on
April 20, 1943, the Bureau of Friar Lands Agent Severo Rivera issued a Notice fixing the
public auction of Lot No. 7449, among others, on May 5, 1943 at 10:00 a.m. (Exh. 1).

On said date, Mabini Legaspi (appellee Virata's predecessor-in-interest) submitted a

winning bid of P290.00 and paid P29.00 (10% of the purchase price) and even issued
Bureau of Lands Official Receipt No. 77735 dated May 5, 1943 (Exh. 7). The subsequent
installments were paid on January 14, 1944, April 24, 1944, August 17, 1944, and
September 20, 1944 in the amounts of P29.00, P29.00, 87.00 and P116.00,
respectively. The payments were evidenced by Official Receipts Nos. 78396, 783392,
784704 and 78466 (Exhs. 7-A, 7-B, 7-C and V)
On December 12, 1944, the Bureau of Lands, through Mr. Vicente Tordesillas, sent a
letter to the Register of Deeds at Imus, Cavite, requesting the issuance of the
corresponding certificates of title to eight persons, among whom was Mabini Legaspi,
specifying with respect to him Lot No. 7449 with an area of 4.8182 located at Bacoor,
Cavite Exh. 2). Accordingly, the Register of Deeds of Cavite issued TCT No. A-2188 to
Mabini Legaspi who held ownership of the property up to December 6, 1957 when he
executed a Deed of Sale transferring it to Antenor S. Virata (Exh. 6). The deed was
registered with the Registry of Deeds on December 10, 1957 . . . . On the same day,
December 10, 1957, the Register of Deeds issued TCT No. 11520 (Exh. 12) to Antenor
Virata . . .
However, on June 7, 1959, the Provincial Capitol building of Cavite which housed the
Registry of Deeds was burned, destroying land records and titles in d registry among
which were the records relating to Lot No. 7449.
On September 1, 1959, the Registry of Deeds administratively reconstituted the
original of TCT No. T-11520 based on owner's duplicate certificate (Exh. 12) and
renumbered the same as TCT No. (T-11520) RT-1660.
xxx

xxx

xxx

The sentence of TCT No. 80889 issued in the name of appellant on February 24, 1976
came to the knowledge of Antenor Virata in August 1978 when he received a subpoena
from the National Bureau of Investigation (NBI) in connection with its investigation of
the conflicting land titles on Lot No. 7449. Virata presented Mabini Legaspi as his
witness. NBI Agent Manuel C. Dionisio took the sworn testimony of Mabini Legaspi on
August 27, 1978 (Exh. 10) and submitted a written report (Exhs. 9 to 9-H) of his
investigation on October 27, 1978. Mabini Legaspi in her sworn testimony (Exh. 10)
declared that she acquired Lot 7449 during the Japanese occupation and in support of
her acquisition, she presented to NBI agent Dionisio the carbon or duplicate original of
the notice of public auction and the letters dated December 12, 1944 of Vicente
Tordesillas of the Bureau of Lands to the Register of Deeds requesting the issuance of a
certificate of title in favor of Mabini Legaspi, which documents were substituted on the
same occasion with xerox copies (Exh. 1 and 2) also marked as Exhibits 10-C and 10-D,
respectively, after a comparison with the duplicate originals. Legaspi also presented
the originals of the receipts of payment she made to the Bureau of Lands, which were
substituted with xerox copies (Exhs. 7, 7-A, 7-B and 7-C, also marked as Exhibit 10-E,
10-F 10-G and 10-H) after comparison with the original. She (Mabini) also testified on
the sale of the lot in favor of Antenor Virata on December 6, 1957, presenting as proof
thereof, the duplicate or carbon original of the Absolute Deed of Sale of Agricultural
Land, which was likewise, substituted with xerox copies (Exhs. 6 to 6-F, inclusive, also
marked Exh. 11).
Mabini Legaspi testified that the originals of Exhibits 1 and 2 got lost. She said she
placed the documents on the table in her house after returning from the NBI
investigation, thinking "all the while that those documents will be useless because I
had my property sold." (Tsn., p. 17, December 19, 1984). She denied having sold the

land to Julian Pearanda, nor having waived her right over the land in his favor (tsn., p.
12, March 18, 1985). (pp. 113-116, Rollo).
On June 15, 1985, the trial court rendered its decision, the dispositive portion of which reads:
WHEREFORE, by preponderance of evidence, judgment is hereby rendered for
defendant Virata and against the plaintiff, to wit:
a. Dismissing the complaint which states no cause of action;
b. Recognizing that defendant Virata is the true and lawful owner of the land covered
by Transfer Certificate of Title No. (T-11520) RT 1660 of the Register of Deeds of the
Province of Cavite and holding that the same is valid;
c. Declaring that Transfer Certificate of Title No. T-80889 in the name of plaintiff, the
Solid State Multi Products Corporation is null and void and of no force and effect and is,
therefore, ordered cancelled;
d. Sentencing the plaintiff to pay the costs of the proceeding.
SO ORDERED. (p. 70, Rollo).
Not satisfied with the decision of the trial court, the petitioner appealed to the Court of
Appeals. On July 13, 1987, the respondent appellate court rendered its decision affirming the
decision of the trial court.
Hence, this petition was filed with the petitioner assigning the following errors:
THE RESPONDENT COURT GROSSLY ERRED WHEN IT IGNORED THE BASIC
CONSIDERATION THAT THE CONTESTED PROPERTY CAME FROM THE FRIAR LANDS
ESTATE THE DISPOSITION OF WHICH IS GOVERNED BY SPECIAL LAWS SPECIFYING THE
REQUIREMENTS FOR ITS ACQUISITION FROM THE GOVERNMENT THROUGH SALE,
WHICH LAW AND SPECIAL REQUIREMENTS SHOULD SERVE AS THE MEASURE AGAINST
WHICH THE EVIDENCE OF THE PARTIES TO THIS CASE SHOULD BE WEIGHED, SUCH
GROSS ERROR LEADING THE APPELLATE COURT TO
(A) ERRONEOUSLY INFER THE EXISTENCE AND/OR DUE ISSUANCE OF THE
SUPPOSED TCT NO. A-2188 (IN THE NAME OF PRIVATE RESPONDENTS
PREDECESSOR-IN INTEREST), FROM DOCUMENTS THAT CAME AFTER WERE
BASED ON SUCH TCT NO. A-2188, CLEARLY BEGGING THE ISSUE WHICH IS
PRECISELY WHETHER OR NOT THE TRANSFER CERTIFICATE OF TITLE WAS IN FACT
ISSUED IN COMPLIANCE WITH THE FRIAR LANDS ACT AND CA-32 TO COVER THE
PROPERTY IN QUESTION;
(B) ERRONEOUSLY BASE ITS DECISION IN FAVOR OF PRIVATE RESPONDENT ON
TCTs ISSUED BY THE REGISTER OF DEEDS INSPITE OF THE FACT THAT IT IS THE
BUREAU OF LANDS UNDER THE DIRECTION OF THE SECRETARY OF AGRICULTURE
AND COMMERCE (NATURAL RESOURCES) WHICH DISPOSES FRIAR LANDS AND
NOT THE REGISTER OF DEEDS WHOSE RECORDS CAN BE NO BETTER THAN THE
RIGHT IT HAS REGISTERED;
(C) ERRONEOUSLY DISREGARD THE PATENT INADMISSIBILITY OF THE
DOCUMENTARY EVIDENCE OFFERED BY THE PRIVATE RESPONDENT THE
ORIGINALS OF WHICH WERE NEVER PRESENTED BEFORE THE TRIAL COURT;

(D) ERRONEOUSLY IGNORE THE LACK OF PROBATIVE VALUE OF SUCH

DOCUMENTARY EVIDENCE SUCH LACK OF PROBATIVE VALUE BEING PATENT ON
THE FACE OF SUCH DOCUMENT;
(E) ERRONEOUSLY IGNORE THE VERITY THAT THE DOCUMENTARY EVIDENCE
COULD SUPPORT NO MORE THAN THE FACT THAT THE RESPONDENTS
PREDECESSOR-IN-INTEREST HAD MERELY A QUESTIONABLE INCHOATE AND
INCOMPLETE RIGHT TO ACQUIRE THE PROPERTY IN QUESTION, WHICH
QUESTIONABLE INCHOATE AND IN FACT UNCOMPLETED RIGHT CANNOT PREVAIL
OVER THE TITLE OF PETITIONER'S PREDECESSOR IN INTEREST WHO WAS THE
ACTUAL POSSESSOR THAT APPLIED FOR THE PURCHASE OF THE LAND EVERY
NEEDED STEP FOR THE PURCHASE HAVING BEEN PASSED UPON AND RECORDED
BY THE BUREAU OF LANDS WHOSE RECORDS SHOW ONE AND ONLY TITLE
ISSUED OVER THE LAND, THAT IS, THE TITLE OF THE PETITIONER'S
PREDECESSOR-IN-INTEREST (pp. 20, 22,Rollo)
We find the petition impressed with merit.
Since the assigned errors were interrelated, it would be well for this Court to discuss
them jointly.
Petitioner does not question the factual findings made by the respondent appellate
court and supported by the records (p. 22, Rollo). It does not however accept the legal
conclusion made by the appellate court and trial court that the registered title of
private respondent to the land should prevail over its own title.
Petitioner contends that Act No. 1120, otherwise known as the Friar Lands Act provides
the procedure for the sale and disposition of the friar lands to private persons; that
pursuant thereto, the acquisition by petitioner's predecessor-in-interest Julian
Pearanda of the disputed Lot 7449, which was formerly part of the friar lands estate,
was in compliance with all legal requisites laid down in Act No. 1120, for the validity of
the sale by the government in favor of Pearanda of such friar lands.
It also argues that the sale of Lot No. 7449 to respondent's predecessor, Mabini
Legaspi, and the issuance of a certificate of title in her favor was in violation of the Friar
Lands Act as there was no required approval by the Secretary of Agriculture and
Natural Resources.
There is no dispute here that the land involved in this case is a friar land and that the
laws which are applicable are Act No. 1120, know as the Friar Lands Act, providing for
the administration and temporary leasing and sale of certain haciendas and parcels of
land, commonly known as friar lands, and Commonwealth Act No. 32 dated September
15, 1936 as amended by Commonwealth Act No. 316 dated June 9, 1938, which
provided for the subdivision and sale of all the portions of the friar lands estated
remaining undisposed of.
Sec. 12 of Act No. 1120 provides in part:
. . . the Chief of the Bureau of Public Lands shall give the said settler and
occupant a certificate which shall set forth in detail that the Government has
agreed to sell to such settler and occupant the amount of land so held by him at
the price so fixed payable as provided in this Act at the Office of the Chief of the
Bureau of Public Lands . . . and that upon the payment of the final installment
together with all accrued interest the Government will convey to such settler
and occupant the said land so held by him by proper instrument of conveyance,

which shall be issued and become effective in the manner provided in section
one hundred and twenty two of the Land Registration Act.
Also, Sec. 18 of the same Act provides:
No lease or sale made by the Chief of the Bureau of Public Lands under the
provisions of this Act shall be valid until approved by the Secretary of the
Interior. (Emphasis ours)
Similarly, Sec. 2 of C.A. No. 32, as amended by C.A. No. 316 provides in part:
. . . The persons who, at the time of the subdivision survey are actual and bona
fide occupants of any portion of the Friar Lands Estates, not exceeding ten
hectares, shall be given preference to purchase the portion occupied at a private
sale and at a price to be fixed in such case, by the Director of Lands, subject to
the approval of the Secretary of Agriculture and Commerce, after taking into
consideration its location, quality, and any other circumstances as may affect its
value, the provisions of section twelve of Act Numbered Eleven hundred and
twenty, as amended, to the contrary, . . . (Emphasis ours)
It is clear from the foregoing provisions that the friar lands were purchased by the
government for sale to actual settlers and occupants at the time said lands are acquired by
the government. The Bureau of Lands shall first issue a certificate stating therein that the
government has agreed to sell the land to such settler or occupant. The latter then shall
accept the certificate and agree to pay the purchase price so fixed and in the installments
and at the interest specified in the certificate.
The conveyance executed in favor of a buyer or purchaser, or the so called certificate of sale,
is a conveyance of the ownership of the property, subject only to the resolutory condition that
the sale may be cancelled if the price agreed upon is not paid for in full. The purchaser
becomes the owner upon the issuance of the certificate of sale in his favor subject only to the
cancellation thereof in case the price agreed upon is not paid (Pugeda vs. Trias, No. L-16925,
March 31, 1962, 4 SCRA 849.)
Upon the payment of the final installment together with all accrued interests, the government
shall then issue a final deed of conveyance in favor of the purchaser. However, the sale of
such friar lands shall be valid only if approved by the Secretary of Interior as provided in Act
No. 1120. Later laws, however, required that the sale shall be approved by the Secretary of
Agriculture and Commerce. In short, the approval by the Secretary of Agriculture and
Commerce is indispensable for the validity of the sale.
It is undisputed that petitioner's predecessor, Julian Pearanda was the actual occupant of Lot
7449 when he filed his application to purchase the said lot on November 22, 1968; that on
December 16, 1989, the Secretary of Agriculture and Natural Resources approved the sale of
the lot without auction to Pearanda; that a sales contract was executed between the Director
of Lands and Pearanda on February 28, 1969 for a consideration of P 1,198.00 payable in 10
monthly installments; that upon the full payment of the price, the Undersecretary of
Agriculture and Natural Resources issued the final deed of conveyance of Lot No. 7449 in
favor of Pearanda. Subsequently, the Register of Deeds of Cavite issued TCT No. 39631 in
the name of Pearanda, and when the latter sold the land to petitioner, TCT No. 39631 was
cancelled and TCT No. T-80889 was issued in favor of the latter.
Clearly, the purchase of the friar land made by Pearanda was in compliance with law. The
execution of the sales contract vested the right of ownership in Pearanda over the land.
There is no doubt whatsoever that the said sale was valid as it was approved by the Secretary
of Agriculture and Natural Resources. Hence, the sale made by Pearanda in favor of the

petitioner transferred the ownership of the land in favor of the latter resulting in the proper
issuance of TCT No. T-80889 in its name.
On the other hand, the antecedents leading to the acquisition of title by respondent Virata are
clearly shown in the records. The latter's predecessor, Mabini Legaspi bought Lot 7449 in a
sale by public auction held on May 5, 1943 conducted by the Bureau of Lands and friar lands
agent Severino Rivera, and paid the purchase price thereof in installments in 1943; that on
December 12, 1944, the Bureau of Lands sent a letter to the Register of Deeds of Cavite
requesting the issuance of certificates of title to several persons including Mabini Legaspi, in
whose favor TCT A-2188 was issued; that subsequently on December 6, 1957, she sold the
disputed land to respondent Virata, which was evidenced by a deed of sale registered with
the Registry of Deeds of Cavite on December 10, 1957; that on the same date, TCT No. 11520
was issued in the name of Virata. Due to the fire which gutted the building housing the
Registry of Cavite on June 7, 1959, the latter administratively reconstituted the original of TCT
No. 11520 on September 1, 1959, based on the owner's duplicate certificate and renumbered
the same as TCT No. 1120 RT 1660.
Apparently, the sale of the lot to Mabini Legaspi occurred much earlier than the date of
acquisition of same lot by petitioner's predecessor, and the evidence presented by
respondent Virata indicates that the latter's predecessor paid the purchase price of Lot No.
7449 on installments.
Nowhere in the evidence for the respondent or in the records of this case however, would
show that a certificate of sale was ever issued by the Bureau of Lands, which would vest
ownership and title over the land in favor of Mabini Legaspi. The existence of the official
receipts showing payment of the price of the land by Legaspi does not prove that the land
was legally conveyed to her without any contract of sale having been executed by the
government in her favor. Viewed from all angles, the acquisition of the lot by Legaspi was
highly irregular and void, and not in compliance with the procedure mandated by law for the
sale of friar lands. For one thing, Mabini Legaspi allegedly purchased the land in a sale at
public auction, which procedure is nowhere provided in Act No. 1120 or in C.A. 32, as
amended by C.A. 316. The laws expressly state that an actual occupant of the land shall
purchase the lot occupied by him at a private sale and not in a sale at public auction (Sec. 2,
C.A. 32 as amended). Further, neither was there any deed of conveyance issued to Legaspi by
the government after the full payment of the installments on the disputed lot.
Highly significant at this point is the fact that there was neither allegation nor proof that the
sale was with the approval of the Secretary of Agriculture and Commerce. The absence of
such approval made the supposed sale null and void ab initio. Without the certificate of sale
to prove the transfer of the ownership of the land from the government Mabini Legaspi and
without the required approval of the sale by the Secretary of Agriculture and Commerce, We
find that Mabini Legaspi did not in any manner acquire ownership over the land in 1943. The
ownership or title over the friar land, specifically Lot No. 7449 remained in the government
until Pearanda, petitioners predecessor, lawfully acquired ownership over the same lot on
February 28, 1969 by virtue of a sales contract executed in his favor.
The issuance of a certificate of title in favor of Mabini Legaspi did not vest ownership upon her
over the land nor did it validate the alleged purchase of the lot, which is null and void. Time
and again, it has been held that registration does not vest title. It is merely evidence of such
title over a particular property. Our land registration laws do not give the holder any better
title than that what he actually has (De man et al. vs. Court of Appeals, G.R. L- 46935
December 21, 1987, 156 SCRA 701; Cruz vs. Cabana, No. 56232, June 22, 1984, 129 SCRA
656).
Although a period of one year has already expired from the time the certificate of title was
issued to Mabini Legaspi pursuant to the alleged sale from the government, said title does not

become incontrovertible but is null and void since the acquisition of the property was in
violation of law. Further, the petitioner herein is in possession of the land in dispute. Hence, its
action to quiet title is imprescriptible (Coronel vs. Intermediate Appellate Court, No. 70191,
October 29, 1987, 155 SCRA 270).1wphi1 In one case, this Court ruled that an adverse
claimant of a registered land who is in possession thereof for a long period of time is not
barred from bringing an action for reconveyance which in effect seeks to quiet title to the
property against a registered owner relying upon a Torrens title which was illegally or
wrongfully acquired (Caragay-Layno vs. Court of Appeals, 133 SCRA 718). In actions for
reconveyance of property predicated on the fact that the conveyance complained of was
void ab initio, a claim of prescription of the action would be unavailing (Corpus, et al. vs.
Beltran, et al., 97 Phil. 722; Agne vs. Director of Lands, G.R. L-40399, February 6, 1990, 181
SCRA 793). Being null and void, the sale made to Mabini Legaspi and the subsequent titles
issued pursuant thereto produced no legal effects whatsoever. Quod nullum est nullum
producit affectum (Agnes vs. Director of Lands, supra). There being no title to the land that
Mabini Legaspi acquired from the government, it follows that no title to the same land could
be conveyed by the former to respondent Virata.
Even assuming that respondent Virata was a purchaser in good faith and for value, the law is,
as between two persons both of whom are in good faith and both innocent of any
negligence, the law must protect and prefer the lawful holder of registered title over the
transferee of a vendor bereft of any transmissible rights (Baltazar vs. Court of Appeals, G.R.
78728, December 8, 1988, 168 SCRA 354, emphasis ours). Further if a person happened to
obtain property by mistake or to the prejudice of another with or without bad faith, the
certificate of title which may have been issued to him under the circumstances may and
should be cancelled or corrected.
Our unavoidable conclusion in this case is that the title of petitioner under the Torrens land
system should be upheld considering that no previous valid title to the same land existed.
ACCORDINGLY, the petition is hereby GRANTED and the decision of the respondent Court of
Appeals dated July 13, 1987 is hereby REVERSED. Petitioner Solid State Multi-Products
Corporation is hereby declared the true owner of the land covered by Transfer Certificate of
Title No. T-80889. The Register of Deeds of Cavite is ordered to cancer transfer Certificate of
Title No. (T-11520) RT 1660 in the name of respondent Antenor Virata.
SO ORDERED.