Republic of the Philippines

REGIONAL TRIAL COURT

Branch 8
Malaybalay City, Bukidnon

NICANOR B. CARAMBA II,

Plaintiff,

Civil Case no. 4010-17

-versus-
For: Quieting of Title

SILVER PENNY CARE LENDING

CORPORATION,
Defendant.

x---------------------------------/

MEMORANDUM
COMES NOW, Plaintiff, by counsel and unto this
Honorable Court, respectfully submits this memorandum in
compliance with the Order dated September 20, 2017 by the
Honorable Court, which was received by the undersigned
counsel on October 18, 2017, directing the parties to submit
their respective memoranda, within fifteen days from the
receipt of such order, or until November 2, 2017, on the issue
on whether or not the complaint should be dismissed outright
on the basis of the affirmative defenses raised in the Answer,
to wit:

Statement of the Case

The actual possession of Nicanor Caramba II, herein

plaintiff, over parcels of land is disturbed by an unlawful real
estate mortgage executed in favor to the defendant Silver
Penny Care Lending Corporation. Hence, this case is filed to
quiet the title over the lots.

Statement of the Facts

 The plaintiff Nicanor B. Caramba II has been possessing
and cultivating the real properties covered by Katibayan ng
Orihinal na Titulo Bilang P-77476, covered by Tax Declaration
No. 02-20-09227; Katibayan ng Orihinal na Titulo Bilang P-
77475, covered by Tax Declaration No. 02-20-09226;
Katibayan ng Orihinal na Titulo Bilang P-74708, covered by
Tax Declaration No. 02-20-09188; Katibayan ng Orihinal na
Titulo Bilang P-74709, covered by Tax Declaration No. 02-20-
09186; Katibayan ng Orihinal na Titulo Bilang P-74710,
covered by Tax Declaration No. 02-20-09189; and Katibayan
ng Orihinal na Titulo bilang 74711, covered by Tax
Declaration No. 02-20-09187, all located at Barangay san
Vicente, Sumilao, Bukidnon, awarded in favor to George
Martin A. Baula, Marie Ann A. Baula, Vanessa Rae A. Baula,
and Anna Catalina A. Baula, respectively.

The possession of the plaintiff started in 2007 when the

patent holders, herein referred as the Baulas, abandoned the
properties after their political downfall in Sumilao, Bukidnon.
The plaintiff cultivated, tilled and planted root crops,
particularly cassava and corn, on the abandoned lots.
Moreover the plaintiff had introduced improvements on the
lands by erecting perimeter fences to ward-off intruders.

The possession of the plaintiff has been disturbed when

he discovered that the subject lots were subjected to real
property mortgage in favor to the Silver Penny Care Lending
Corporation, herein defendants. Much less, the real estate
mortgage was executed within the prohibitory period or within
five years from the award of the patent; an act that is
contrary to law. The possession of the plaintiff, therefore, is
endangered by reason of an unlawful contract of mortgage.
Hence, this complaint.

Statement of the Issues

A reading of the Answer suggests the following issues:

1. Whether or not the complaint should be dismissed

outright because complainant has no cause of action for
lack of legal personality to file the instant case;
 2. Whether or not the complaint should be dismissed
outright because the complaint assails the encumbrance
which was approved and allowed by the state, through
the DENR, as annotated in the Certificates of Title;

3. Whether or not the action should be dismissed outright

for failure to pay the proper filing fee; and,

4. Whether or not the present complaint for quieting of

title should be dismissed outright because it is improper
and devoid of legal basis.

Arguments

As to the first issue

The defendant alleges that the case must be dismissed

because the plaintiff has no legal personality to assail the said
titles and that the case must be dismissed for lack of cause of
action on account of lack of legal personality to file the
present complaint.

The above defenses are denied for lack of merit. The

complainant herein has been occupying and possessing the
subject properties since 2007 when the owner Baulas had
abandoned them. The Baulas are no longer to be found in
Sumilao, Bukidnon since their political downfall. From then,
their whereabouts are unknown, thereby abandoning the
lands awarded to them by virtue of patents.

Meanwhile, the complainant occupied the lands by

cultivating them with agricultural crops such as cassava and
corn. Moreover, he has introduced improvements on the
properties by constructing perimeter fences on the boundaries
to exclude other persons from intruding and entering the
premises.

It is therefore prejudicial to claim, as the defendant

alleges, that the complainant has no legal personality to file
the instant action. It is clear that the resolution of this case
would benefit or injure his rights over the agricultural crops
and necessary expenses in the preservation of the properties.
 The legal rights over a property are not only available to
the actual owners but also to those who have interest in the
said properties. Hence, Article 539 of the New Civil Code of
the Philippines provides that, “Every possessor has a right
to be respected in his possession; and should he be
disturbed therein he shall be protected in or restored to
said possession by the means established by the laws
and the Rules of Court. xxx".

Consequently, as a possessor, he is entitled to take

necessary legal actions to protect his right. Hence, the
allegation of the defendant that the instant case should be
dismissed for absence of legal personality to file the complaint
is bereft of merit;

Similarly, as to the allegation of lack of personality, the

complainant is a real party-in-interest. A party-in-interest is
the party who stands to be benefited or injured by the
judgment in the suit, or the party entitled to the avails of the
suit. Clearly, the plaintiff will be benefited or injured in the
resolution of the instant action as he is the possessor of the
subject real properties. Again, he has been possessing and
cultivating the abandoned lands.

Any person-in- interest is allowed to take legal remedies

when his right or interest is prejudiced or endangered.
Correspondingly, not only the owner of the real property but
also any person having interest over the real property may
seek relief before the court of justice to protect his right or
his interest therein. Yet again, the plaintiff is a party-in-
interest;

As to the second issue

The case should not be dismissed outright on account

that the complaint assails the encumbrance which was
previously approved and allowed by the state, through the
DENR, who issued the said grant as annotated in the
Certificates of Title.

The subject properties that are in the possession of the

complainant- Nicanor Caramba were subjected to real estate
mortgage. As discussed above, the complainant has right of
possession over the properties and this right is endangered
by the said act of encumbrance.

The mortgage was made and executed within the

prohibitory period provided under Section 118 of
Commonwealth Act 141. Hence,

“Except in favour 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
or grant, nor shall they become liable to the
satisfaction of any debt contracted prior to the
expiration of said period, but the improvements or
crops on the land may be mortgaged or pledged to
qualified persons, associations, or corporations. xxx”
(Section 118 of Commonwealth Act 141).

Applying the above-quoted law, the encumbrance in

favor to the herein defendant is therefore unlawful. In other
words, the approval of the DENR, as appearing in the title
under the memorandum of encumbrance, is void for being
contrary to law.

As to the third issue

The action should not be dismissed outright on the

ground that the plaintiff failed to pay the proper filing fee.

It is notable that the plaintiff had paid the necessary

filing and docket fees, therefore, the Honorable Court did not
err in acquiring jurisdiction over the subject matter. Dismissal
warrants only when there is non-payment of docket fees and
not when the complainant pays or has paid the docket fees. It
is absurd to dismiss the case for failure to pay the docket fees
when it is apparent that payment has been actually made.

The rule on payment of docket fees has, in some

instances, been made subject to the rule on liberal
interpretation. Thus, in a case, it was held that while the
payment of the required docket fee is a jurisdictional
requirement, even its non-payment at the time of filing does
not automatically cause the dismissal of the case, as long as
the fee is paid within the applicable prescriptive or
reglementary period (PAGCOR v. Lopez, 474 SCRA 76). Also if
the amount of docket fees is insufficient considering the
amount of the claim, the party filing the case will be required
to pay the deficiency, but jurisdiction is not automatically lost
(Rivera v. Del Rosario, 419 SCRA 626).

Moreover, the valuation of the land is not vital in the

determination of the docket fee because the plaintiff herein is
occupying and has been occupying the subject lands.
Valuation is necessary only when the complainant does not
actually possessing the properties.

As to fourth issue

Whether or not the present complaint for quieting of title

should be dismissed outright because it is improper and
devoid of legal basis

The instant complaint should not be dismissed outright

on the ground of impropriety of the action of quieting of title.
Art. 476 of the New Civil Code provides, “Whenever there is a
cloud on title to real property or any interest therein, by
reason of any instrument, record, claim, encumbrance or
proceeding, which is apparently valid or effective but is in
truth and in fact invalid, ineffective, voidable or
unenforceable, and may be prejudicial to said title, an action
may be brought to remove such cloud or to quiet the title.”

An action for quieting of title is proper when the

following requisites are satisfied:

1. The plaintiff or complainant has legal or an equitable title

to or interest in the real property subject of the action;
2. There is a cloud on the title to real property or any
interest therein; and,
3. The deed, claim, encumbrance or proceeding claimed
to be casting cloud on his tittle must be shown to be in
fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy.
 Hence, the complainant has satisfied the above-
enumerated requisites in the filing of the instant action: 1.)
that, he has interest over the subject properties as a
possessor thereof. It is not necessary that the person seeking
to quiet title be the registered owner of the property in
question (Mamadsual v. Moson, 190 SCRA 82); that, the
encumbrance made in favor to the defendant cast cloud on
the possession of the complainant; and, that the
encumbrance is in fact invalid and inoperative as it is violative
to the law, that the encumbrance was executed, as discussed
above, during the prohibitory period.

Wherefore, premises considered, it is most respectfully

prayed unto this Honorable Court not to dismiss the instant
complaint outright on the basis of the affirmative defenses
raised in the Answer. Further, it is also prayed that after due
notice and hearing, an order be issued declaring the real
estate mortgage contract executed by the grantee/holder of
patents in favor to defendant be quiet for it created and will
create cloud or doubt in the possession of plaintiff over the
real properties.

Other reliefs and remedies just and equitable under the

premises are likewise prayed for.

Cagayan de Oro City for Malaybalay City, Philippines.

October 30, 2017.

MERLIN P. CAIŇA & ASSOCIATES

Counsel for the Complainant
2/F Consortium Building
Corrales Extension, Cagayan de Oro City
Mobile No. 09268261008
Landline Phone No. (088) 880-2822
E-mail Address: mpc_lawoffice@yahoo.com

SYLVAN GERALD L. SABIO

IBP CDO (O.R. No.) 10595 11: Jan. 06, 2017
PTR CDO (O.R. No.) 3295855, Jan. 03, 2017
MCLE Compliance No. VI-0000814, Sep. 29, 2016
TIN 178-265-979; Roll No. 45542