ENVIRONMENTAL LAW OUTLINE II
G.R. No. L-50464 January 29, 1990
SUNBEAM CONVENIENCE FOODS INC., CORAL BEACH DEVELOPMENT CORP., and the REGISTER OF
DEEDS OF BATAAN, petitioners, vs. HON. COURT OF APPEALS and THE REPUBLIC OF THE
PHILIPPINES, respondents.
In this petition for review on certiorari, Convenience Foods Corporation (hereafter simply SUNBEAM) and
Coral Beach Development Corporation (hereafter simply CORAL BEACH) bring to our attention the decision
rendered by the Court of Appeals in "Republic of the Philippines v. Hon. Pedro T. Santiago, et al.," disposing
as follows: WHEREFORE, the writ prayed for is granted. The order of the respondent judge dated October 7,
1977, dismissing Civil Case No. 4062 is set aside, and respondent judge is ordered to require private
respondents to file their answer to the complaint in said Civil Case No. 4062 and thereafter to proceed with
the trial of the case on the merits and to render judgment thereon.'
The following facts stated by the respondent Court in its decision and restated by the petitioners in their
petition are accurate: On April 29, 1963, the Director of Lands caused the issuance of a Sales Patent in favor
of defendant Sunbeam Convenience Foods, Inc., over the parcels of land both situated in Mariveles, Bataan
and more particularly described and bounded as follows:
On May 3, 1963, the aforesaid Sales Patent was registered with the defendant Register of Deeds of Bataan
who in turn issued Original Certificate of Title No. Sp-24 in favor of defendant Sunbeam Convenience Foods,
Inc., for the two parcels of land above-described;
Subsequently, Original Certificate of Title No. Sp-24 was cancelled and in lieu thereof, Transfer Certificate of
Title No. T-12421 was issued over Lot 1, Sgs-2409, while Transfer Certificate of Title No. 12422 was issued
over Lot 2, Sgs-2409, both in favor of defendant Coral Beach Development Corporation I. On May 11, 1976,
the Solicitor General in the name of the Republic of the Philippines instituted before the Court of First
Instance of Bataan, an action for reversion docketed as Civil Case No. 4062. 2
SUNBEAM and CORAL BEACH filed a Motion to Dismiss on the following grounds: (1) The Republic of the
Philippines should have exhausted all administrative remedies before filing the case in court; (2) The title
issued to SUNBEAM and CORAL BEACH had become indefeasible and imperscriptible; (3) The action for
reversion was defective, having been initiated by the Solicitor General and not by the Director of Lands. 3 The
then Court of First Instance of Bataan dismissed the complaint in the Order of October 7, 1977, 4adopting
mainly the theory that since the titles sought to be cancelled emanated from the administrative act of the
Bureau of Lands Director, the latter, not the courts, had jurisdiction over the disposition of the land.
The Solicitor General received the copy of the Order on October 11, 1977 and filed a Notice of Appeal dated
October 25, 1977 . 5 The Solicitor General then moved for an extension of thirty days within which to file the
Record on Appeal and to pay the docket fee in order to perfect the appeal. This was to be followed by
another motion for extension filed by the Solicitor General, resulting in the Court of Appeals granting the
petitioner another extension of fifteen days from December 10, 1977. Finally before this period of extension
lapsed, instead of an appeal, a petition for certiorari with the respondent Court of Appeals was filed.
According to the Solicitor General, the Court of First Instance committed grave abuse of discretion in
dismissing the complaint and in
a. Not finding that since the lower court acted in a Motion to Dismiss, the correctness of its decision must
be decided in the assumed truth and accuracy of the allegations of the complaint. The complaint
alleges that the lands in question are forest lands; hence, inalienable.
b. Finding that Lots I and 2 are alienable and disposable lands of the public domain under the jurisdiction
of the Director of Lands despite clear and positive evidence to the contrary.
c. Concluding that the complaint for reversion is defective as it was not initiated by the Director of Lands.
d. Finding that the complaint for reversion states no cause of action for alleged failure of petitioner to
exhaust administrative remedies. 6
The Court of Appeals gave due course to the petition for certiorari, set aside the Order of Dismissal rendered
by the Court of First Instance in Civil Case No. 4062, and ordered the presiding judge Hon. Pedro T.
Santiago to receive the answers of the private respondents SUNBEAM and CORAL BEACH in the action for
reversion.
Hence Sunbeam and Coral Beach filed this petition for review.
A review is not a matter of right but of sound judicial discretion, and is granted only when there are special
and important reasons therefore. The following, while neither controlling nor fully measuring the Court's
discretion, enumerates the premises for granting a review:
a) When the Court of Appeals has decided a question of substance, not theretofore determined by
the Supreme Court or has decided it in a way probably not in accord with law or the applicable decisions of
the Supreme Court; and
b) When the Court of Appeals has so far departed from the accepted and usual course of judicial
proceedings or so far sanctioned such departure by a lower court as to call for supervision . 7
We agree with the Court of Appeals' granting of the petition filed by the Republic of the Philippines charging
the then Court of First Instance with grave abuse of discretion. The filing of the Motion to Dismiss the
complaint for reversion by SUNBEAM and CORAL BEACH on the ground of lack of cause of action,
necessarily carried with it the admission, for purposes of the motion, of the truth of all material facts pleaded
in the complaint instituted by the Republic.
An important factual issue raised in the complaint was the classification of the lands as forest lands. This
material allegation stated in the Republic's complaint' was never denied specifically 9 by the defendants
(petitioners herein) SUNBEAM and CORAL BEACH.
If it is true that the lands are forest lands, then all these proceedings become moot and academic. Land
remains unclassified land until it is released therefrom and rendered open to disposition. 10
Our adherence to the Regalian doctrine subjects all agricultural, timber, and mineral lands to the dominion of
the State. 11 Thus, before any land may be declassified from the forest group and converted into alienable or
disposable land for agricultural or other purposes, there must be a positive act from the government. Even
rules on the confirmation of imperfect titles do not apply unless and until the land classified as forest land is
released in an official proclamation to that effect so that it may form part of the disposable agricultural lands
of the public domain. 12
The mere fact that a title was issued by the Director of Lands does not confer any validity on such title if the
property covered by the title or patent is part of the public forest. 13
The only way to resolve this question of fact as to the classification of the land is by remanding the case to
the lower court for a full- dress trial on the issues involved.
Generally, the rules of procedure must be observed so that the efficient administration of justice is ensured.
However, the rules of procedure should be viewed as mere tools designed to facilitate the attainment of
justice. 14They must lead to the proper and just determination of litigation, without tying the hands of the law
or making it indifferent to realities.
Certiorari is one such remedy. Considered extraordinary, it is made available only when there is no appeal,
nor any plain, speedy or adequate remedy in the ordinary course of the law. The long line of decisions
denying the petition for certiorari, either before appeal was availed of or specially in instances where the
appeal period has lapsed, far outnumbers the instances when certiorari was given due course. The few
significant exceptions were: when public welfare and the advancement of public policy dictate; or when the
broader interests of justice so require, or when the writs issued are null, 16 or when the questioned order
amounts to an oppressive exercise of judicial authority. 17
We find nothing disagreeable with the action of the Court of Appeals to give due course to the petition
considering that the issue affected a matter of public concern which is the disposition of the lands of our
matrimony No less than the Constitution protects its policy.
We therefore find no compelling reason to disturb the findings of the appellate court, in the absence of a
clear showing that the Court of Appeals has decided a question of substance in a manner inconsistent with
jurisprudence, or that the respondent Court has departed from the accepted and usual course of judicial
proceedings. In sum, no reversible error has been committed by the respondent court. 18 WHEREFORE, the
petition is DENIED and the decision of the Court of Appeals is affirmed. Costs against the petitioners.
SO ORDERED.
G.R. No. 129401 February 2, 2001
FELIPE SEVILLE and et al., petitioners, vs. NATIONAL DEVELOPMENT COMPANY, respondents.
Unless a public land is shown to have been reclassified as alienable or actually alienated by the State to a
private person, that piece of land remains part of the public domain. Hence, occupation thereof, however long,
cannot ripen into ownership.
The Case: Before us is a Petition for Review on Certiorari assailing the November 29, 1996 Decision of the
Court of Appeals1(CA), as well as the May 19, 1997 CA Resolution2 denying the Motion for Reconsideration.
The dispositive part of the CA Decision reads as follows:
"WHEREFORE, the appealed decision is REVERSED and SET ASIDE. Another judgment is hereby rendered
dismissing the complaint. The counterclaims of appellants are denied. Costs against plaintiffs-appellees."3
The Facts: The appellate court narrated the undisputed facts in this manner: By virtue of Presidential Decree
No. 625, Leyte Sab-A Basin Development Authority (LSBDA) was created to integrate government and
private sector efforts for a planned development and balanced growth of the Sab-a Basin in the [P]rovince of
Leyte, empowered to acquire real property in the successful prosecution of its business. Letter of Instruction
No. 962 authorized LSBDA to acquire privately-owned lands circumscribed in the Leyte Industrial
Development Estate (LIDE) by way of negotiated sales with the landowners.
On June 14, 1980, [Respondent] Calixtra Yap sold to LSBDA Lot No. 057 SWO 08-000047 consisting of
464,920 square meters, located at Barangay Sto. Rosario, Isabel, Leyte, covered under Tax Declarations Nos.
3181, 3579, 3425, 1292 and 4251 under the name of said vendor. On June 1, 1982, appellant LSBDA fired a
Miscellaneous Sales Application with the Bureau of Lands covering said lot together with other lots acquired
by LSBDA with an aggregate area of '442,7508 square meters.'
After due notice and investigation conducted by the Bureau of Lands, Miscellaneous Sales Patent No. 9353
was issued in the name of [Respondent] LSBDA on the basis of which Original Certificate of Title No.
P-28131 was transcribed in the Registration Book for the [P]rovince of Leyte on August 12, 1983 in the name
of [Respondent] LSBDA. On December 14, 1989, LSBDA assigned all its rights over the subject property to
its [Co-respondent] National Development Company (NOC) as a result of which a new Transfer Certificate of
Title "vas issued on March 2, 1990 by the Registry of Deeds for the Province of Northern Leyte in the name
of NDC. The subject property was leased to [Respondents] Philippine Associated Smelting & Refining
Corporation (PASAR), Philippine Phosphate Fertilizer Corporation (PHILPHOS) and Lepanto Consolidated
Mining Co., Inc. (LEPANTO).
On November 29, 1988, the Estate of Joaquin Ortega represented by judicial administrator Felipe Seville filed
with the Regional Trial Court (Branch 12) of Ormoc City, a complaint for recovery of real property, rentals and
damages against the above-named [respondents] which complaint was later on amended on May 11, 1990.
[Respondents] filed their respective Answers. After trial, the trial court rendered judgment the dispositive
portion of which reads as follows:
'WHEREFORE, [a] decision is hereby rendered for [petitioners] and against [respondents].
1. The Deed of Sale executed by Calixtra Yap on June 14, 1980 in favor of LSBDA, (Exhibit PP and 25)
conveying the subject property to said LSBDA is declared NULL and VOID ab initio;
2. The intestate estate of JOAQUIN ORTEGA is declared the owner in fee simple of the 735,333 square
meters real property subject of the present action and defendant NDC is ordered to segregate the same area
from OCT P-28131 and CONVEY the same to the Estate of Joaquin Ortega;
3. Upon the segregation of the 735,333 square meters from OCT No. P-28131 the Register of Deeds of the
Province of Leyte is ordered to issue 8 new title to the said portion in the name of the Intestate Estate of
Joaquin Ortega;
4. [Respondents] LSBDA, NDC, PASAR, are ordered to pay jointly and severally to [petitioners] the sum of
FOUR MILLION SEVEN HUNDRED EIGHTY FOUR THOUSAND EIGHT HUNDRED FORTY SIX PESOS
(P4,784,846.00) as rentals due from 1979 to the present, plus accrued interest pursuant to par. 2 of the
Lease Contract between NDC and PASAR. (Exhibit 54)
5. [Respondents] LSBDA, NDC, and PHILPHOS are also ordered to pay jointly and severally [petitioners] the
sum of TWO MILLION EIGHTY SIX THOUSAND THREE HUNDRED NINETY EIGHT PESOS AND SIXTY
CENTAVOS (P2,086,398.60) as accrued rentals of PHILPHOS from 1979 to present, plus the accrued
interest for non-payment pursuant to paragraph 2 of the same Lease Contract cited above;
6. [Respondents] are ordered to pay jointly and severally [petitioners] P200,000.00 as indemnity for the value
of the ancestral home;
7. [Respondents] are also ordered to pay jointly and severally [petitioners] the sum of P250,000.00 as
reimbursement for attorney's fees and the further sum of P50,000.00 as expenses for litigation;
8. Finally, [petitioners] and [respondents] are ordered to sit down together and discuss the possibility of a
compromise agreement on how the improvements introduced on the landholding subject of the present suit
should be disposed of and for the parties to submit to this Court a joint manifestation relative thereto. In the
absence of any such compromise agreement, such improvements shall be disposed of pursuant to Article
449 of the New Civil Code. Costs against [respondents].
Ruling of the Court of Appeals: Citing the Regalian doctrine that lands not appearing to be privately owned
are presumed to be part of the public domain, the CA held that, first, there was no competent evidence to
prove that the property in question was private in character. Second, possession thereof, no matter how long,
would not ripen into ownership, absent any showing that the land had been classified as alienable. Third, the
property had been untitled before the issuance of the Miscellaneous Sales Patent in favor of LSBDA. Fourth,
petitioners were guilty of laches, because they had failed to apply for the judicial confirmation of their title, if
they had any. Fifth, there was no evidence of bad faith on "the part of LSBDA in dealing with Yap regarding
the property. Hence, this Petition.5
The Issues: In their Memorandum, petitioners submit the following issues for the consideration of the Court:6
A. Whether or not the sale by Calixtra Yap of the Estate of the Late Joaquin Ortega in favor of LSBDA
was null and void.
B. Whether or not the issuance of a Miscellaneous Sales Patent and an Original Certificate of Title in
favor of LSBDA was valid.
C. Whether or not petitioners are guilty of laches.
D. Whether or not petitioners are entitled to the remedy of reconveyance and the damages awarded by
the trial court."
In the main, the Court is called upon to determine the validity of LSBDA's title. In resolving this issue, it will
also ascertain whether, before the issuance of the title, the land was private or public.
The Court's Ruling: The Petition has no merit.
Main Issue: Validity of LSBDA: Petitioners argue that LSBDA's title to 73 hectares of the 402- hectare Leyte
Industrial Development Estate was void, having allegedly been obtained from Calixtra Yap who had no right
to it. They maintain that they acquired title to the disputed property by acquisitive prescription, because they
and their predecessors in interest had been in possession of it for more than thirty years.7 Although it was the
subject of settlement proceedings, petitioners further claim that Yap sold the same to LSBDA without the
permission of the trial court. Disputing these contentions, respondents and the appellate court maintain that
petitioners have not shown that the land had previously been classified as alienable and disposable. Absent
such classification, they argue that possession of it, no matter how long, could not ripen into ownership.
We agree with respondents and the appellate court. First, there was no showing that the land had been
classified as alienable before the title was issued to LSBDA; hence, petitioners could not have become
owners thereof through acquisitive prescription. Second, petitioners' challenge to LSBDA's title cannot be
granted, because it is based on a wrong premise and amounts to a collateral attack, which is not allowed by
law.
Public Character of the Land
Under the Regalian doctrine, all lands of the public domain belong to the State, which is the source of any
asserted right to ownership of land. All lands not otherwise appearing to be clearly within private ownership
are presumed to belong to the State.8 In Menguito v. Republic,9 the Court held that "unless public land is
shown to have been reclassified or alienated to a private person by the State, it remains part of the
inalienable public domain. Indeed, 'occupation thereof in the concept of owner, no matter how long, cannot
ripen into ownership and be registered as a title.' To overcome such presumption, incontrovertible evidence
must be shown by the applicant. Absent such evidence, the land sought to be registered remains
inalienable."
A person in open, continuous, exclusive and notorious possession of a public land for more than thirty years
acquires an imperfect title thereto. That title may be the subject of judicial confirmation, pursuant to Section
48 of the Public Land Act, which provides:
"SECTION 48. The following described citizens of the Philippines, occupying lands of public domain or
claiming to own any such lands or an interest thereon, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the province where the land is located for
confirmation of their claims, and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:
(b) those who by themselves or through their predecessor in-interest have been in open, continuous,
exclusive and notorious possession and occupation of agricultural lands of the public domain, under a
bona fide claim of acquisition or ownership, for at least thirty years immediately preceding the filing of
the application for confirmation of title except when prevented by war or force majeure. They shall be
conclusively presumed to have performed all the conditions essential to a Government grant and shall
he entitled to a certificate of title under the provisions of this Chapter."
Under Section 4 of Presidential Decree (PD) No. 1073,10 paragraph "b" of the aforecited provision applies
only to alienable and disposable lands of the public domain. The provision reads:
"SEC. 4. The provisions of Section 48 (b) and Section 48 (c), Chapter VIII, of the Public Land Act, are
hereby amended in the sense that these provisions shall apply only to alienable and disposable lands
of the public domain which have been in open, continuous, exclusive and notorious possession and
occupation by the applicant himself or thru his predecessor-in-interest, under a bona fide claim of
acquisition of ownership, since June 12, 1945."
It should be stressed that petitioners had no certificate of title over the disputed property. Although they claim
that their title was based on acquisitive prescription, they fail to present incontrovertible proof that the land
had previously been classified as alienable. They simply brush aside the conclusion of the CA on this crucial
point by saying that it was "without factual basis."11 Instead, they maintain that the private character of the
land was evidenced by various tax declarations, Deeds of Sale, and Decisions of the trial court and even the
Supreme Court.12 Petitioners' arguments are not convincing. Tax declarations are not conclusive proofs of
ownership, let alone of the private character of the land. At best, they are merely "indicia of a claim of
ownership."13 In Spouses Palomo v. CA,14 the Court also rejected tax declarations as proof of private
ownership, absent any showing that the forest land in question had been reclassified as alienable.
Moreover, the Deeds of Sale of portions of the disputed property, which Joaquin Ortega and several vendors
executed, do not prove that the land was private in character. The question remains: What was the character
of the land when Ortega purchased it? Indeed, a vendee acquires only those rights belonging to the vendor.
But petitioners failed to show that, at the time, the vendors were already its owners, or that the land was
already classified as alienable. Also misplaced is petitioners' reliance on Ortega v. CA,15 in which the
Supreme Court allegedly recognized the private character of the disputed property .In that case, the sole
issue was "whether the respondent judge acted in excess of jurisdiction when he converted Civil Case No.
1184-O, an action for quieting of title, declaration of nullity of sale, and annulment of tax declaration of a
parcel of land, into an action for the declaration of who is the legal wife, who are the legitimate children, if
any, and who are the compulsory heirs of the deceased Joaquin Ortega."16 The Court did not at all make any
ruling that the property had been classified as alienable.
In any event, Ortega arose from a suit for quieting of title, an action quasi in rem that was binding only
between the parties.17 The present respondents as well as the Bureau of Lands, which subsequently declared
that the land was public, are not bound by that ruling, because they were not impleaded therein.
While petitioners refer to the trial court proceedings supposedly recognizing the private character of the
disputed property, they make no claim that these cases directly involve the classification of the land, or that
the Bureau of Lands is a party thereto. Clearly, the burden of proof that the land has been classified as
alienable is on the claimant.18 In the present case, petitioners failed to discharge this burden. Hence, their
possession of the disputed property, however long, cannot ripen into ownership.
LSBDA's Title: Equally unmeritorious is the argument of petitioners that the title of LSBDA is void. As earlier
stated, they claim that such title was derived from Calixtra Yap, who was allegedly not the owner of the
property. Petitioners assume that LSBDA, having acquired the rights of Yap, resorted to a confirmation of her
imperfect title under Section 48 of the Public Land Act. This argument is devoid of factual or legal basis.
Petitioners fail to consider that the title of LSBDA was based, not on the conveyance made by Yap, but on
Miscellaneous Sales Patent No. 9353 issued by the director of the Bureau of Lands. In fact, after LSBDA
had filed an application for patent, the Bureau of Lands conducted an investigation and found that the land
was part of the public domain. After compliance with the notice and publication requirements, LSBDA
acquired the property in a public auction conducted by the Bureau of Lands.19
Petitioners insist, however, that LSBDA was estopped from claiming that the land was public, because the
Deed of Sale executed by Yap in its favor stipulated that "the seller is the absolute owner in fee simple of the
described property."20 It is scarcely necessary to address this point. To begin with, the power to classify a
land as alienable belongs to the State, not to private entities. Hence, the pronouncements of Yap or LSBDA
cannot effect the reclassification of the property. Moreover, the assailed misrepresentation was made by Yap
as seller. Hence, objections thereto should be raised not by petitioners but by LSBDA, the contracting party
obviously aggrieved. In any case, the actions of LSBDA after Yap's conveyance demonstrated its position
that the disputed land was part of the public domain. That this was so can be inferred from LSBDA's
subsequent application for a Miscellaneous Sales Patent and, in a public auction, its purchase of the property
from the Bureau of Lands. Indeed, Yap merely conveyed a claim, not a title which she did not have.
Collateral Attack: There is another reason for denying the present Petition. Petitioners insist that they "are
not seeking the re-opening of a decree under the Torrens system." Supposedly, they are only "praying for the
segregation of 735,333 square meters of land, or 73 hectares more or less from the OCT No. P-28131 issued
to LSBDA."21 This disputation is mere quibbling over words, plain and simple.
Semantics aside, petitioners are effectively seeking the modification of LSBDA's OCT, which allegedly
encompassed even a parcel of land allegedly belonging to them. Hence, the present suit, purportedly filed for
the "recovery of real property and damages," is tantamount to a collateral attack not sanctioned by law.
Section 48 of PD 1529, the Property Registration Decree, expressly provides:
"SEC. 48. Certificate not subject to collateral attack. -- A certificate of title shall not be subject to
collateral attack. It cannot be altered, modified, or cancelled except in a direct proceeding in
accordance with law."
It has been held that a certificate of title, once registered, should not thereafter be impugned, altered,
changed, modified, enlarged or diminished, except in a direct proceeding permitted by law. Otherwise, the
reliance on registered titles would be lost.22
Moreover, the title became indefeasible and incontrovertible after the lapse of one year from the time of its
registration and issuance.23 Section 32 of PD 1529 provides that "[u]pon the expiration of said period of one
year, the decree of registration and the certificate of title shall become incontrovertible. Any person aggrieved
by such decree of registration in any case may pursue his remedy by action for damages against the
applicant or other persons responsible for the fraud." Although LSBDA's title was registered in 1983,
petitioners filed the amended Complaint only in 1990.
Reconveyance
Petitioners also claim that the disputed property should be reconveyed to them. This cannot be allowed.
Considering that the land was public before the Miscellaneous Sales Patent was issued to LSBDA, petitioners
have no standing to ask for the reconveyance of the property to them. The proper remedy is an action for
reversion, which may be instituted only by the Office of the Solicitor General, pursuant to Section 101 of the
Public Land Act, which reads as follows:
"SEC. 101. All actions for the reversion to the Government of lands of the public domain or
improvements thereon shall be instituted by the Solicitor General or the officer acting in his stead, in
the proper courts, in the name of the [Republic] of the Philippines."
Verily, the prayer for reconveyance and, for that matter, the entire case of petitioners rest on the theory that
they have acquired the property by acquisitive prescription; and that Yap, without any right or authority, sold
the same to LSBDA.
Conclusion
In the light of our earlier disquisition, the theory has no leg to stand on. Absent any showing that the land has
been classified as alienable, their possession thereof, no matter how lengthy, cannot ripen into ownership. In
other words, they have not become owners of the disputed property. Moreover, LSBDA's title was
derived from a Miscellaneous Sales Patent, not from Yap. Finally, petitioners cannot, by a collateral attack,
challenge a certificate of title that has already become indefeasible and incontrovertible. If petitioners believe
that they have been defrauded by Yap, they should seek redress, not in these proceedings, but in a proper
action in accordance with law. WHEREFORE, the Petition is hereby DENIED and the assailed Decision
AFFIRMED. Costs against petitioners. SO ORDERED.
G.R. No. 128017 January 20, 1999
RAMON ITURALDE, petitioner, vs. ALFREDO FALCASANTOS, respondent.
The case is an appeal via certiorari from a decision of the Court of Appeals reversing that of the Regional
Trial Court, Branch 2, Basilan province, and dismissing petitioner's complaint for recovery of possession and
ownership of a parcel of land with the improvements existing thereon, situated at Barangay Upper Baas,
municipality of Lantawan, province of Basilan, with an area of 7.1248 hectares.
The facts may be related as follows:
On October 17, 1986, petitioner acquired by purchase from the heirs of. Pedro Mana-ay a parcel of land
located at Baas, Lantawan, Basilan Province, with an area of 6.0000 hectares, more or less, more
particularly described as follows: A parcel of land, situated at Baas, Lantawan Basilan. Bounded on the
North by property of Alejandro; Marso; on the East by property of Ramon Bacor; on the South by property at
Atty. Ricardo G. Mon and on the West by property of Librada Guerrero. Containing an area of 6.0000
hectares, more or less. However, on November 3, 1986, respondent applied with the Bureau of Lands in
Isabela, Basilan province, for the award to him of the same parcel of land under free patent. On November
17, 1986, petitioner filed a protest to such application. On February 7, 1989, the Regional Director of Lands
rendered a decision giving respondent a period of one hundred twenty (120) days to exercise the right to
repurchase the land by reimbursing petitioner of all expenses he incurred in the purchase of the property in
question, and held in abeyance respondent's application for free patent. On October 11, 1989, the Regional
Director issued an order declaring that respondent had waived his right of repurchase, and rejected his
application for free patent for lack of interest, and allowed petitioner to file a public land application for the
subject land. On May 8, 1990, the Regional Director ordered respondent to vacate the land in question, but
respondent refused. On July 24, 1990, petitioner filed with the Regional Trial Court, Basilan province, a
complaint for recovery of ownership and possession with preliminary injunction of the subject parcel of land.
In Answer to the complaint, respondent alleged that the land occupied by him belonged to the Republic of the
Philippines, and that he had introduced improvements thereon such as coconut and other fruit trees.
After trial on the merits, on March 20, 1993, the trial court rendered decision declaring petitioner the owner
and the possessor of the subject parcel of land with all the improvements existing thereon, situated at
Barangay Upper Baas, municipality of Lantawan, province of Basilan, with an area of 3.1248 hectares, and
ordering respondent to vacate the land in question, to pay petitioner the amount of ten thousand pesos
(P10,000.00) as attorneys fee, the amount of five thousand pesos (P5,000.00) as litigation expenses, the
three hundred pesos (P300.00) as judicial cost.
In due time, petitioner appealed the trial court's decision to the Court of Appeals. On December 20, 1996, the
Court of Appeals rendered decision reversing the appealed decision, and entering a new judgment dismissing
petitioner's complaint without prejudice to any action that petitioner may take if the subject land was
declassified from forest land to alienable and disposable land of the public domain. Hence, the present
recourse. Petitioner submits that the Court of Appeals erred in setting aside the trial court's decision in his
favor and dismissing the complaint because when the Director of Lands allowed petitioner to file a public land
application for said property, it was equivalent to a declaration that said land was no longer part of the public
domain. We deny the petition. The Court of Appeals correctly held that "the evidence is unrebutted that the
subject land is within the Forest Reserve Area as per L.C. Map No. 1557 certified on August 13, 1951 and,
hence, not capable of private appropriation and occupation. 2
In Republic vs. Register of Deeds of Quezon, we held that "Forest land, like mineral timber lands which are
public lands, are not subject to private ownership unless they under the Constitution, become private
properties. In the absence of such classification, the land remains unclassified public land until released
therefrom and rendered open to disposition." 3 In Sunbeam Convenience Foods Inc. vs. Court of Appeals,
we said: "Thus, before any land may be declassified from the forest group and converted into alienable or
disposable land for agricultural or other purposes, there must be a positive act from the government. Even
rules on the confirmation of imperfect titles do not apply unless and until the land classified as forest land is
released in an official proclamation to that effect so that it may form part of the disposable agricultural lands
of the public domain." 4 Hence, a positive act of the government is needed to declassify a forest land into
alienable or disposable land for agricultural or other purposes. " 5 And the rule is "Possession of forest lands,
however long, cannot ripen into private ownership." 6 What is more, there is yet no award or grant to petitioner
of the land in question by free patent or other ways of acquisition of public land. Consequently, he cannot
lawfully claim to be the owner of the land in question. WHEREFORE, the Courts hereby AFFIRMS the
appealed decision of the Court of Appeals in CA-G.R. CV No. 42306, dismissing the complaint of petitioner
before the Regional Trial Court, Basilan province, in Civil Case No. 441-63.
ARTICLE 12
SECTION 7. Save in cases of hereditary succession, no private lands shall be transferred or conveyed except
to individuals, corporations, or associations qualified to acquire or hold lands of the public domain.
SECTION 8. Notwithstanding the provisions of Section 7 of this Article, a natural-born citizen of the
Philippines who has lost his Philippine citizenship may be a transferee of private lands, subject to limitations
provided by law.
ARTICLE 4
SECTION 1. The following are citizens of the Philippines:
1) Those who are citizens of the Philippines at the time of the adoption of this Constitution;
2) Those whose fathers or mothers are citizens of the Philippines;
3) Those born before January 17, 1973, of Filipino mothers, who elect Philippine citizenship upon
reaching the age of majority; and
4) Those who are naturalized in accordance with law.
G.R. No. 149615 August 29, 2006
IN RE: PETITION FOR SEPARATION OF PROPERTY ELENA BUENAVENTURA MULLER, Petitioner, vs.
HELMUT MULLER, Respondent.
This petition for review on certiorari 1 assails the February 26, 2001 Decision 2 of the Court of Appeals in
CA-G.R. CV No. 59321 affirming with modification the August 12, 1996 Decision 3 of the Regional Trial Court
of Quezon City, Branch 86 in Civil Case No. Q-94-21862, which terminated the regime of absolute community
of property between petitioner and respondent, as well as the Resolution 4 dated August 13, 2001 denying
the motion for reconsideration.
The facts are as follows: Petitioner Elena Buenaventura Muller and respondent Helmut Muller were married in
Hamburg, Germany on September 22, 1989. The couple resided in Germany at a house owned by
respondents parents but decided to move and reside permanently in the Philippines in 1992. By this time,
respondent had inherited the house in Germany from his parents which he sold and used the proceeds for
the purchase of a parcel of land in Antipolo, Rizal at the cost of P528,000.00 and the construction of a house
amounting to P2,300,000.00. The Antipolo property was registered in the name of petitioner under Transfer
Certificate of Title No. 219438 5 of the Register of Deeds of Marikina, Metro Manila.
Due to incompatibilities and respondents alleged womanizing, drinking, and maltreatment, the spouses
eventually separated. On September 26, 1994, respondent filed a petition 6 for separation of properties before
the Regional Trial Court of Quezon City. On August 12, 1996, the trial court rendered a decision which
terminated the regime of absolute community of property between the petitioner and respondent. It also
decreed the separation of properties between them and ordered the equal partition of personal properties
located within the country, excluding those acquired by gratuitous title during the marriage. With regard to the
Antipolo property, the court held that it was acquired using paraphernal funds of the respondent. However, it
ruled that respondent cannot recover his funds because the property was purchased in violation of Section 7,
Article XII of the Constitution. Thus However, pursuant to Article 92 of the Family Code, properties acquired
by gratuitous title by either spouse during the marriage shall be excluded from the community property. The
real property, therefore, inherited by petitioner in Germany is excluded from the absolute community of
property of the herein spouses. Necessarily, the proceeds of the sale of said real property as well as the
personal properties purchased thereby, belong exclusively to the petitioner. However, the part of that
inheritance used by the petitioner for acquiring the house and lot in this country cannot be recovered by the
petitioner, its acquisition being a violation of Section 7, Article XII of the Constitution which provides that
"save in cases of hereditary succession, no private lands shall be transferred or conveyed except to
individuals, corporations or associations qualified to acquire or hold lands of the public domain." The law will
leave the parties in the situation where they are in without prejudice to a voluntary partition by the parties of
the said real property. As regards the property covered by Transfer Certificate of Title No. 219438 of the
Registry of Deeds of Marikina, Metro Manila, situated in Antipolo, Rizal and the improvements thereon, the
Court shall not make any pronouncement on constitutional grounds. 7
Respondent appealed to the Court of Appeals which rendered the assailed decision modifying the trial
courts Decision. It held that respondent merely prayed for reimbursement for the purchase of the Antipolo
property, and not acquisition or transfer of ownership to him. It also considered petitioners ownership over
the property in trust for the respondent. As regards the house, the Court of Appeals ruled that there is
nothing in the Constitution which prohibits respondent from acquiring the same. The dispositive portion of the
assailed decision reads: WHEREFORE, in view of the foregoing, the Decision of the lower court dated August
12, 1996 is hereby MODIFIED. Respondent Elena Buenaventura Muller is hereby ordered to REIMBURSE
the petitioner the amount of P528,000.00 for the acquisition of the land and the amount of P2,300,000.00 for
the construction of the house situated in Atnipolo, Rizal, deducting therefrom the amount respondent spent for
the preservation, maintenance and development of the aforesaid real property including the depreciation cost
of the house or in the alternative to SELL the house and lot in the event respondent does not have the
means to reimburse the petitioner out of her own money and from the proceeds thereof, reimburse the
petitioner of the cost of the land and the house deducting the expenses for its maintenance and preservation
spent by the respondent. Should there be profit, the same shall be divided in proportion to the equity each
has over the property. The case is REMANDED to the lower court for reception of evidence as to the amount
claimed by the respondents for the preservation and maintenance of the property.
SO ORDERED. 8
Hence, the instant petition for review raising the following issues:
I. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE RESPONDENT HEREIN
IS ENTITLED TO REIMBURSEMENT OF THE AMOUNT USED TO PURCHASE THE LAND AS WELL AS THE
COSTS FOR THE CONSTRUCTION OF THE HOUSE, FOR IN SO RULING, IT INDIRECTLY ALLOWED AN
ACT DONE WHICH OTHERWISE COULD NOT BE DIRECTLY x x x DONE, WITHOUT DOING VIOLENCE TO
THE CONSTITUTIONAL PROSCRIPTION THAT AN ALIEN IS PROHIBITED FROM ACQUIRING OWNERSHIP
OF REAL PROPERTIES LOCATED IN THE PHILIPPINES.
II. THE COURT OF APPEALS GRAVELY ERRED IN SUSTAINING RESPONDENTS CAUSE OF ACTION WHICH
IS ACTUALLY A DESPERATE ATTEMPT TO OBTAIN OWNERSHIP OVER THE LOT IN QUESTION,
CLOTHED UNDER THE GUISE OF CLAIMING REIMBURSEMENT.
Petitioner contends that respondent, being an alien, is disqualified to own private lands in the Philippines; that
respondent was aware of the constitutional prohibition but circumvented the same; and that respondents
purpose for filing an action for separation of property is to obtain exclusive possession, control and disposition
of the Antipolo property.
Respondent claims that he is not praying for transfer of ownership of the Antipolo property but merely
reimbursement; that the funds paid by him for the said property were in consideration of his marriage to
petitioner; that the funds were given to petitioner in trust; and that equity demands that respondent should be
reimbursed of his personal funds.
The issue for resolution is whether respondent is entitled to reimbursement of the funds used for the
acquisition of the Antipolo property. The petition has merit.
Section 7, Article XII of the 1987 Constitution states: Save in cases of hereditary succession, no private lands
shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or
hold lands of the public domain. Aliens, whether individuals or corporations, are disqualified from acquiring
lands of the public domain. Hence, they are also disqualified from acquiring private lands. 9 The primary
purpose of the constitutional provision is the conservation of the national patrimony. In the case of Krivenko v.
Register of Deeds, 10 the Court held: Under section 1 of Article XIII of the Constitution, "natural resources,
with the exception of public agricultural land, shall not be alienated," and with respect to public agricultural
lands, their alienation is limited to Filipino citizens. But this constitutional purpose conserving agricultural
resources in the hands of Filipino citizens may easily be defeated by the Filipino citizens themselves who
may alienate their agricultural lands in favor of aliens. It is partly to prevent this result that section 5 is
included in Article XIII, and it reads as follows: "Sec. 5. Save in cases of hereditary succession, no private
agricultural land will be transferred or assigned except to individuals, corporations, or associations qualified to
acquire or hold lands of the public domain in the Philippines."
This constitutional provision closes the only remaining avenue through which agricultural resources may leak
into aliens hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if,
after all, they may be freely so alienated upon their becoming private agricultural lands in the hands of
Filipino citizens. If the term "private agricultural lands" is to be construed as not including residential lots or
lands not strictly agricultural, the result would be that "aliens may freely acquire and possess not only
residential lots and houses for themselves but entire subdivisions, and whole towns and cities," and that "they
may validly buy and hold in their names lands of any area for building homes, factories, industrial plants,
fisheries, hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds, airfields, and a
host of other uses and purposes that are not, in appellants words, strictly agricultural." (Solicitor Generals
Brief, p. 6.) That this is obnoxious to the conservative spirit of the Constitution is beyond question.
Respondent was aware of the constitutional prohibition and expressly admitted his knowledge thereof to this
Court. 11 He declared that he had the Antipolo property titled in the name of petitioner because of the said
prohibition. 12 His attempt at subsequently asserting or claiming a right on the said property cannot be
sustained. The Court of Appeals erred in holding that an implied trust was created and resulted by operation
of law in view of petitioners marriage to respondent. Save for the exception provided in cases of hereditary
succession, respondents disqualification from owning lands in the Philippines is absolute. Not even an
ownership in trust is allowed. Besides, where the purchase is made in violation of an existing statute and in
evasion of its express provision, no trust can result in favor of the party who is guilty of the fraud. 13 To hold
otherwise would allow circumvention of the constitutional prohibition.
Invoking the principle that a court is not only a court of law but also a court of equity, is likewise misplaced. It
has been held that equity as a rule will follow the law and will not permit that to be done indirectly which,
because of public policy, cannot be done directly. 14 He who seeks equity must do equity, and he who comes
into equity must come with clean hands. The latter is a frequently stated maxim which is also expressed in
the principle that he who has done inequity shall not have equity. It signifies that a litigant may be denied
relief by a court of equity on the ground that his conduct has been inequitable, unfair and dishonest, or
fraudulent, or deceitful as to the controversy in issue. 15 Thus, in the instant case, respondent cannot seek
reimbursement on the ground of equity where it is clear that he willingly and knowingly bought the property
despite the constitutional prohibition. Further, the distinction made between transfer of ownership as opposed
to recovery of funds is a futile exercise on respondents part. To allow reimbursement would in effect permit
respondent to enjoy the fruits of a property which he is not allowed to own. Thus, it is likewise proscribed by
law. As expressly held in Cheesman v. Intermediate Appellate Court: Finally, the fundamental law prohibits
the sale to aliens of residential land. Section 14, Article XIV of the 1973 Constitution ordains that, "Save in
cases of hereditary succession, no private land shall be transferred or conveyed except to individuals,
corporations, or associations qualified to acquire or hold lands of the public domain." Petitioner Thomas
Cheesman was, of course, charged with knowledge of this prohibition. Thus, assuming that it was his
intention that the lot in question be purchased by him and his wife, he acquired no right whatever over the
property by virtue of that purchase; and in attempting to acquire a right or interest in land, vicariously and
clandestinely, he knowingly violated the Constitution; the sale as to him was null and void. In any event, he
had and has no capacity or personality to question the subsequent sale of the same property by his wife on
the theory that in so doing he is merely exercising the prerogative of a husband in respect of conjugal
property. To sustain such a theory would permit indirect controversion of the constitutional prohibition. If the
property were to be declared conjugal, this would accord to the alien husband a not insubstantial interest and
right over land, as he would then have a decisive vote as to its transfer or disposition. This is a right that the
Constitution does not permit him to have.
As already observed, the finding that his wife had used her own money to purchase the property cannot, and
will not, at this stage of the proceedings be reviewed and overturned. But even if it were a fact that said wife
had used conjugal funds to make the acquisition, the considerations just set out to militate, on high
constitutional grounds, against his recovering and holding the property so acquired, or any part thereof. And
whether in such an event, he may recover from his wife any share of the money used for the purchase or
charge her with unauthorized disposition or expenditure of conjugal funds is not now inquired into; that would
be, in the premises, a purely academic exercise.
WHEREFORE, in view of the foregoing, the instant petition is GRANTED. The Decision dated February 26,
2001 of the Court of Appeals in CA-G.R. CV No. 59321 ordering petitioner Elena Buenaventura Muller to
reimburse respondent Helmut Muller the amount of P528,000 for the acquisition of the land and the amount
of P2,300,000 for the construction of the house in Antipolo City, and the Resolution dated August 13, 2001
denying reconsideration thereof, are REVERSED and SET ASIDE. The August 12, 1996 Decision of the
Regional Trial Court of Quezon City, Branch 86 in Civil Case No. Q-94-21862 terminating the regime of
absolute community between the petitioner and respondent, decreeing a separation of property between them
and ordering the partition of the personal properties located in the Philippines equally, is REINSTATED.
G.R. Nos. 113472-73 December 20, 1994
ONG CHING PO, YU SIOK LIAN DAVID ONG and JIMMY ONG, petitioners,
vs. COURT OF APPEALS and SOLEDAD PARIAN, respondents.
This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court of the Decision of the
Court of Appeals dated July 15, 1993, which dismissed the petition for certiorari in CA-G.R. CV Nos.
28391-92.
On July 23, 1947, Ong Joi Jong sold a parcel of land located at Fundidor Street, San Nicolas to private
respondent Soledad Parian, the wife of Ong Yee. The latter, the brother of petitioner Ong Ching Po, died in
January 1983; while petitioner Ong Ching Po died in October 1986. The said sale was evidenced by a
notarized Deed of Sale written in English. Subsequently, the document was registered with the Register of
Deeds of Manila, which issued Transfer Certificate of Title No. 9260 dated September 2, 1947 in the name of
private respondent. According to private respondent, she entrusted the administration of the lot and building
to petitioner Ong Ching Po when she and her husband settled in Iloilo. When her husband died, she
demanded that the lot be vacated because she was going to sell it. Unfortunately, petitioners refused to
vacate the said premises. On March 19, 1984, private respondent filed a case for unlawful detainer against
petitioner Ong Ching Po before the Metropolitan Trial Court of Manila, Branch 26. The inferior court dismissed
her case. The dismissal was affirmed by the Regional Trial Court, Branch 10, Manila. The decision of the
Regional Trial Court was, in turn, affirmed by the Court of Appeals, which dismissed the petition. The decision
of the Court of Appeals became final and executory.
Petitioners, on the other hand, claimed that on July 23, 1946, petitioner Ong Ching Po bought the said parcel
of land from Ong Joi Jong. The sale was evidenced by a photo copy of a Deed of Sale written in Chinese
with the letter head "Sincere Trading Co." (Exh. "B").
On December 6, 1983, petitioner Ong Ching Po executed a Deed of Absolute Sale conveying to his children,
petitioners Jimmy and David Ong, the same property sold by Ong Joi Jong to private respondent in 1947. On
December 12 1985, petitioners Ong Ching Po, Jimmy Ong and David Ong filed an action for reconveyance
and damages against private respondent in the Regional Trial Court, Branch 53, Manila.
On July 26, 1986, private respondent filed an action for quieting of title against petitioners Ong Ching Po and
his wife, petitioner Yu Siok Lian, in the Regional Trial Court, Branch 58, Manila. On May 30 1990, the trial
court rendered a decision in favor of private respondent. On appeal by petitioners to the Court of
Appeals, the said court affirmed the decision of the Regional Trial Court. Hence, this petition.
According to petitioners, the Court of Appeals erred:
1. When it gave full faith and credit to the Deed of Sale in favor of
respondent, instead of the Deed of Sale in favor of petitioner Ong Ching Po.
2. When it concluded that the acts of petitioners were not acts of ownership; and
3. When it ruled that no express nor implied trust existed between petitioners and
private respondent
As stated by petitioners themselves, what is in dispute ". . . is not so much as to which between Exhibit "A"
and "Exhibit "B" is more weighty, but whether this document is what it purports to be (i.e., a deed of
conveyance in favor of Soledad Parian [private respondent] or it was only resorted to or executed as a
subterfuge because the real buyer (Ong Ching Po) was an alien and it was agreed upon between Ong Ching
Po and his brother (Ong Yee, Soledad Parian's husband) that the land be registered in the name of Soledad
Parian in order to avoid legal complications and to facilitate registration and transfer and that the said title
would be transferred by Soledad to Ong Ching Po or his successors-in-interest and that she would be holding
the title in trust for him" We cannot go along with the claim that petitioner Ong Ching Po merely used private
respondent as a dummy to have the title over the parcel of land registered in her name because being an
alien he was disqualified to own real property in the Philippines. To sustain such an outrageous contention
would be giving a high premium to a violation of our nationalization laws.
Assuming that Exhibit "B" is in existence and that it was duly executed, still petitioners cannot claim
ownership of the disputed lot by virtue thereof.
Section 5, Article XIII of the 1935 Constitution provides, as follows: Save in cases of hereditary succession,
no private agricultural land shall be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the Philippines.
Section 14, Article XIV of the 1973 Constitution provides, as follows: Save in cases of hereditary succession,
no private land shall be transferred or conveyed except to individuals, corporations, or associations qualified
to acquire or hold lands in the public domain.
Section 7, Article XII of the 1987 Constitution provides: Save in cases of hereditary succession, no private
lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire
or hold lands in the public domain.
The capacity to acquire private land is made dependent upon the capacity to acquire or hold lands of the
public domain. Private land may be transferred or conveyed only to individuals or entities "qualified to acquire
lands of the public domain"
The 1935 Constitution reserved the right to participate in the "disposition, exploitation, development and
utilization" of all "lands of the public domain and other natural resources of the Philippines" for Filipino
citizens or corporations at least sixty percent of the capital of which was owned by Filipinos. Aliens, whether
individuals or corporations, have been disqualified from acquiring public lands; hence, they have also been
disqualified from acquiring private lands. Petitioner Ong Ching Po was a Chinese citizen; therefore, he was
disqualified from acquiring and owning real property. Assuming that the genuineness and due execution of
Exhibit "B" has been established, the same is null and void, it being contrary to law.
On the other end of the legal spectrum, the deed of sale executed by Ong Joi Jong in favor of private
respondent (Exh. "A") is a notarized document. To remove the mantle of validity bestowed by law on said
document, petitioners claim that private respondent admitted that she did not pay anything as consideration
for the purported sale in her favor. In the same breath, petitioners said that private respondent implied in her
deposition that it was her husband who paid for the property. It appears, therefore, that the sale was financed
out of conjugal funds and that it was her husband who handled the transaction for the purchase of the
property. Such transaction is a common practice in Filipino-family affairs.
It is not correct to say that private respondent never took possession of the property. Under the law,
possession is transferred to the vendee by virtue of the notarized deed of conveyance. Under Article 1498 of
the Civil Code of the Philippines, "when the sale is made through a public instrument, the execution thereof
shall be equivalent to the delivery of the object of the contract, if from the deed the contrary does not appear
or cannot clearly be inferred." If what petitioners meant was that private respondent never lived in the building
constructed on said land, it was because her family had settled in Iloilo. There is no document showing the
establishment of an express trust by petitioner Ong Ching Po as trustor and private respondent as trustee.
Not even Exhibit "B" can be considered as such a document because private respondent, the registered
owner of the property subject of said "deed of sale," was not a party thereto. The oral testimony to prove the
existence of the express trust will not suffice. Under Article 1443 of the Civil Code of the Philippines, "No
express trust concerning an immovable or any interest therein may be proved by parole evidence."
Undaunted, petitioners argue that if they cannot prove an express trust in writing, they can prove an implied
trust orally. While an implied trust may be proved orally (Civil Code of the Philippines, Art. 1457), the
evidence must be trustworthy and received by the courts with extreme caution, because such kind of
evidence may be easily fabricated (Salao v. Salao, 70 SCRA 65 [1976]). It cannot be made to rest on vague
and uncertain evidence or on loose, equivocal or indefinite declarations (Cf. De Leon v. Molo-Peckson, et al.,
116 Phil. 1267 [1962]). Petitioners do not claim that Ong Yee was not in a financial position to acquire the
land and to introduce the improvements thereon. On the other hand, Yu Siok Lian, the wife of petitioner Ong
Ching Po, admitted in her testimony in court that Ong Yee was a stockholder of Lam Sing Corporation and
was engaged in business.
The Court of Appeals did not give any credence to Exhibit "B" and its translation, Exhibit "C", because these
documents had not been properly authenticated.
Under Section 4, Rule 130 of the Revised Rules of Court: Secondary Evidence when Original is lost or
destroyed. When the original writing has been lost or destroyed, or cannot be produced in court, upon proof
of its execution and lost or destruction, or unavailability, its contents may be proved by a copy, or by a recital
of its contents in some authentic document, or by the recollection of the witnesses.
Secondary evidence is admissible when the original documents were actually lost or destroyed. But prior to
the introduction of such secondary evidence, the proponent must establish the former existence of the
document. The correct order of proof is as follows: existence; execution; loss; contents. This order may be
changed if necessary in the discretion of the court (De Vera v. Aguilar, 218 SCRA 602 [1993]). Petitioners
failed to adduce evidence as to the genuineness and due execution of the deed of sale, Exhibit "B". The due
execution of the document may be established by the person or persons who executed it; by the person
before whom its execution was acknowledged; or by any person who was present and saw it executed or
who after its execution, saw it and recognized the signatures; or by a person to whom the parties to the
instrument had previously confessed the execution thereof (De Vera v. Aguilar, supra).
Petitioner Yu Siok Lian testified that she was present when said document was executed, but the trial court
rejected her claim and held: If it is true that she was present, why did she not sign said document, even
merely as a witness? Her oral testimony is easy to concoct or fabricate. Furthermore, she was married only
on September 6, 1946 to the plaintiff, Ong Ching Po, in Baguio City where she apparently resided, or after
the deed of sale was executed. The Court does not believe that she was present during the execution and
signing of the deed of sale involved therein, notwithstanding her pretensions to the contrary.
As to the contention of petitioners that all the tax receipts, tax declaration, rental receipts, deed of sale (Exh.
"B") and transfer certificate of title were in their possession, private respondent explained that she and her
husband entrusted said lot and building to petitioners when they moved to Iloilo.
As observed by the Court of Appeals: We find, however, that these acts, even if true, are not necessarily
reflective of dominion, as even a mere administrator or manager may lawfully perform them pursuant to his
appointment or employment. It is markworthy that all the tax receipts were in the name of private respondent
and her husband. The rental receipts were also in the name of her husband.
WHEREFORE, the petition is DISMISSED.
G.R. No. 143958 July 11, 2003
ALFRED FRITZ FRENZEL, petitioner, vs. EDERLINA P. CATITO, respondent.
Before us is a petition for review of the Decision1 of the Court of Appeals in CA-G.R. CV No. 53485 which
affirmed the Decision2 of the Regional Trial Court of Davao City, Branch 14, in Civil Case No. 17,817
dismissing the petitioner's complaint, and the resolution of the Court of Appeals denying his motion for
reconsideration of the said decision.
The Antecedents3 As gleaned from the evidence of the petitioner, the case at bar stemmed from the following
factual backdrop: Petitioner Alfred Fritz Frenzel is an Australian citizen of German descent. He is an
electrical engineer by profession, but worked as a pilot with the New Guinea Airlines. He arrived in the
Philippines in 1974, started engaging in business in the country two years thereafter, and married Teresita
Santos, a Filipino citizen. In 1981, Alfred and Teresita separated from bed and board without obtaining a
divorce. Sometime in February 1983, Alfred arrived in Sydney, Australia for a vacation. He went to King's
Cross, a night spot in Sydney, for a massage where he met Ederlina Catito, a Filipina and a native of Bajada,
Davao City. Unknown to Alfred, she resided for a time in Germany and was married to Klaus Muller, a
German national. She left Germany and tried her luck in Sydney, Australia, where she found employment as
a masseuse in the King's Cross nightclub. She was fluent in German, and Alfred enjoyed talking with her.
The two saw each other again; this time Ederlina ended up staying in Alfred's hotel for three days. Alfred
gave Ederlina sums of money for her services.4
Alfred was so enamored with Ederlina that he persuaded her to stop working at King's Cross, return to the
Philippines, and engage in a wholesome business of her own. He also proposed that they meet in Manila, to
which she assented. Alfred gave her money for her plane fare to the Philippines. Within two weeks of
Ederlina's arrival in Manila, Alfred joined her. Alfred reiterated his proposal for Ederlina to stay in the
Philippines and engage in business, even offering to finance her business venture. Ederlina was delighted at
the idea and proposed to put up a beauty parlor. Alfred happily agreed.
Alfred told Ederlina that he was married but that he was eager to divorce his wife in Australia. Alfred
proposed marriage to Ederlina, but she replied that they should wait a little bit longer.
Ederlina found a building at No. 444 M.H. del Pilar corner Arquiza Street, Ermita, Manila, owned by one Atty.
Jose Hidalgo who offered to convey his rights over the property for P18,000.00. Alfred and Ederlina accepted
the offer. Ederlina put up a beauty parlor on the property under the business name Edorial Beauty Salon, and
had it registered with the Department of Trade and Industry under her name. Alfred paid Atty. Hidalgo
P20,000.00 for his right over the property and gave P300,000.00 to Ederlina for the purchase of equipment
and furniture for the parlor. As Ederlina was going to Germany, she executed a special power of attorney on
December 13, 19835appointing her brother, Aser Catito, as her attorney-in-fact in managing the beauty parlor
business. She stated in the said deed that she was married to Klaus Muller. Alfred went back to Papua New
Guinea to resume his work as a pilot. When Alfred returned to the Philippines, he visited Ederlina in her
Manila residence and found it unsuitable for her. He decided to purchase a house and lot owned by Victoria
Binuya Steckel in San Francisco del Monte, Quezon City, covered by Transfer Certificate of Title No. 218429
for US$20,000.00. Since Alfred knew that as an alien he was disqualified from owning lands in the
Philippines, he agreed that only Ederlina's name would appear in the deed of sale as the buyer of the
property, as well as in the title covering the same. After all, he was planning to marry Ederlina and he
believed that after their marriage, the two of them would jointly own the property. On January 23, 1984, a
Contract to Sell was entered into between Victoria Binuya Steckel as the vendor and Ederlina as the sole
vendee. Alfred signed therein as a witness.6 Victoria received from Alfred, for and in behalf of Ederlina, the
amount of US$10,000.00 as partial payment, for which Victoria issued a receipt.7 When Victoria executed the
deed of absolute sale over the property on March 6, 1984,8 she received from Alfred, for and in behalf of
Ederlina, the amount of US$10,000.00 as final and full payment. Victoria likewise issued a receipt for the said
amount.9 After Victoria had vacated the property, Ederlina moved into her new house. When she left for
Germany to visit Klaus, she had her father Narciso Catito and her two sisters occupy the property. Alfred
decided to stay in the Philippines for good and live with Ederlina. He returned to Australia and sold his fiber
glass pleasure boat to John Reid for $7,500.00 on May 4, 1984.10 He also sold his television and video
business in Papua New Guinea for K135,000.00 to Tekeraoi Pty. Ltd.11 He had his personal properties
shipped to the Philippines and stored at No. 14 Fernandez Street, San Francisco del Monte, Quezon City.
The proceeds of the sale were deposited in Alfred's account with the Hong Kong Shanghai Banking
Corporation (HSBC), Kowloon Branch under Bank Account No. 018-2-807016.12 When Alfred was in Papua
New Guinea selling his other properties, the bank sent telegraphic letters updating him of his account.13
Several checks were credited to his HSBC bank account from Papua New Guinea Banking Corporation,
Westpac Bank of Australia and New Zealand Banking Group Limited and Westpac Bank-PNG-Limited. Alfred
also had a peso savings account with HSBC, Manila, under Savings Account No. 01-725-183-01.14
Once, when Alfred and Ederlina were in Hong Kong, they opened another account with HSBC, Kowloon, this
time in the name of Ederlina, under Savings Account No. 018-0-807950.15 Alfred transferred his deposits in
Savings Account No. 018-2-807016 with the said bank to this new account. Ederlina also opened a savings
account with the Bank of America Kowloon Main Office under Account No. 30069016.16
On July 28, 1984, while Alfred was in Papua New Guinea, he received a Letter dated December 7, 1983
from Klaus Muller who was then residing in Berlin, Germany. Klaus informed Alfred that he and Ederlina had
been married on October 16, 1978 and had a blissful married life until Alfred intruded therein. Klaus stated
that he knew of Alfred and Ederlina's amorous relationship, and discovered the same sometime in November
1983 when he arrived in Manila. He also begged Alfred to leave Ederlina alone and to return her to him,
saying that Alfred could not possibly build his future on his (Klaus') misfortune.17
Alfred had occasion to talk to Sally MacCarron, a close friend of Ederlina. He inquired if there was any truth
to Klaus' statements and Sally confirmed that Klaus was married to Ederlina. When Alfred confronted
Ederlina, she admitted that she and Klaus were, indeed, married. But she assured Alfred that she would
divorce Klaus. Alfred was appeased. He agreed to continue the amorous relationship and wait for the
outcome of Ederlina's petition for divorce. After all, he intended to marry her. He retained the services of
Rechtsanwaltin Banzhaf with offices in Berlin, as her counsel who informed her of the progress of the
proceedings.18 Alfred paid for the services of the lawyer. In the meantime, Alfred decided to purchase another
house and lot, owned by Rodolfo Morelos covered by TCT No. 92456 located in Pea Street, Bajada, Davao
City.19 Alfred again agreed to have the deed of sale made out in the name of Ederlina. On September 7,
1984, Rodolfo Morelos executed a deed of absolute sale over the said property in favor of Ederlina as the
sole vendee for the amount of P80,000.00.20 Alfred paid US$12,500.00 for the property. Alfred purchased
another parcel of land from one Atty. Mardoecheo Camporedondo, located in Moncado, Babak, Davao,
covered by TCT No. 35251. Alfred once more agreed for the name of Ederlina to appear as the sole vendee
in the deed of sale. On December 31, 1984, Atty. Camporedondo executed a deed of sale over the property
for P65,000.00 in favor of Ederlina as the sole vendee.21 Alfred, through Ederlina, paid the lot at the cost of
P33,682.00 and US$7,000.00, respectively, for which the vendor signed receipts.22 On August 14, 1985, TCT
No. 47246 was issued to Ederlina as the sole owner of the said property.23 Meanwhile, Ederlina deposited on
December 27, 1985, the total amount of US$250,000 with the HSBC Kowloon under Joint Deposit Account
No. 018-462341-145.24 The couple decided to put up a beach resort on a four-hectare land in Camudmud,
Babak, Davao, owned by spouses Enrique and Rosela Serrano. Alfred purchased the property from the
spouses for P90,000.00, and the latter issued a receipt therefor.25 A draftsman commissioned by the couple
submitted a sketch of the beach resort.26 Beach houses were forthwith constructed on a portion of the
property and were eventually rented out by Ederlina's father, Narciso Catito. The rentals were collected by
Narciso, while Ederlina kept the proceeds of the sale of copra from the coconut trees in the property. By this
time, Alfred had already spent P200,000.00 for the purchase, construction and upkeep of the property.
Ederlina often wrote letters to her family informing them of her life with Alfred. In a Letter dated January 21,
1985, she wrote about how Alfred had financed the purchases of some real properties, the establishment of
her beauty parlor business, and her petition to divorce Klaus.27
Because Ederlina was preoccupied with her business in Manila, she executed on July 8, 1985, two special
powers of attorney28 appointing Alfred as attorney-in-fact to receive in her behalf the title and the deed of sale
over the property sold by the spouses Enrique Serrano.
In the meantime, Ederlina's petition for divorce was denied because Klaus opposed the same. A second
petition filed by her met the same fate. Klaus wanted half of all the properties owned by Ederlina in the
Philippines before he would agree to a divorce. Worse, Klaus threatened to file a bigamy case against
Ederlina.29 Alfred proposed the creation of a partnership to Ederlina, or as an alternative, the establishment of
a corporation, with Ederlina owning 30% of the equity thereof. She initially agreed to put up a corporation and
contacted Atty. Armando Dominguez to prepare the necessary documents. Ederlina changed her mind at the
last minute when she was advised to insist on claiming ownership over the properties acquired by them
during their coverture. Alfred and Ederlina's relationship started deteriorating. Ederlina had not been able to
secure a divorce from Klaus. The latter could charge her for bigamy and could even involve Alfred, who
himself was still married. To avoid complications, Alfred decided to live separately from Ederlina and cut off
all contacts with her. In one of her letters to Alfred, Ederlina complained that he had ruined her life. She
admitted that the money used for the purchase of the properties in Davao were his. She offered to convey
the properties deeded to her by Atty. Mardoecheo Camporedondo and Rodolfo Morelos, asking Alfred to
prepare her affidavit for the said purpose and send it to her for her signature.30 The last straw for Alfred came
on September 2, 1985, when someone smashed the front and rear windshields of Alfred's car and damaged
the windows. Alfred thereafter executed an affidavit-complaint charging Ederlina and Sally MacCarron with
malicious mischief.31 On October 15, 1985, Alfred wrote to Ederlina's father, complaining that Ederlina had
taken all his life savings and because of this, he was virtually penniless. He further accused the Catito family
of acquiring for themselves the properties he had purchased with his own money. He demanded the return of
all the amounts that Ederlina and her family had "stolen" and turn over all the properties acquired by him and
Ederlina during their coverture.32 Shortly thereafter, Alfred filed a Complaint33 dated October 28, 1985, against
Ederlina, with the Regional Trial Court of Quezon City, for recovery of real and personal properties located in
Quezon City and Manila. In his complaint, Alfred alleged, inter alia, that Ederlina, without his knowledge and
consent, managed to transfer funds from their joint account in HSBC Hong Kong, to her own account with the
same bank. Using the said funds, Ederlina was able to purchase the properties subject of the complaints. He
also alleged that the beauty parlor in Ermita was established with his own funds, and that the Quezon City
property was likewise acquired by him with his personal funds.34
Ederlina failed to file her answer and was declared in default. Alfred adduced his evidence ex parte.
In the meantime, on November 7, 1985, Alfred also filed a complaint35 against Ederlina with the
Regional Trial Court, Davao City, for specific performance, declaration of ownership of real and
personal properties, sum of money, and damages. He alleged, inter alia, in his complaint: That during
the period of their common-law relationship, plaintiff solely through his own efforts and resources
acquired in the Philippines real and personal properties valued more or less at P724,000.00; The
defendant's common-law wife or live-in partner did not contribute anything financially to the acquisition
of the said real and personal properties.
Alfred prayed that after hearing, judgment be rendered in his favor: WHEREFORE, in view of the foregoing
premises, it is respectfully prayed that judgment be rendered in favor of plaintiff and against defendant:
 a) Ordering the defendant to execute the corresponding deeds of transfer and/or conveyances in favor of
plaintiff over those real and personal properties enumerated in Paragraph 4 of this complaint;
b) Ordering the defendant to deliver to the plaintiff all the above real and personal properties or their money
value, which are in defendant's name and custody because these were acquired solely with plaintiffs money
and resources during the duration of the common-law relationship between plaintiff and defendant, the
description of which are as follows:
1. TCT No. T-92456 (with residential house) located at Bajada, Davao City, consisting of 286 square meters,
registered in the name of the original title owner Rodolfo Morelos but already fully paid by plaintiff. Valued
at P342,000.00;
2. TCT No. T-47246 (with residential house) located at Babak, Samal, Davao, consisting of 600 square meters,
registered in the name of Ederlina Catito, with the Register of Deeds of Tagum, Davao del Norte, valued at
P144,000.00;
3. A parcel of agricultural land located at Camudmud, Babak, Samal, Davao del Norte, consisting of 4.2936
hectares purchased from Enrique Serrano and Rosela B. Serrano. Already fully paid by plaintiff. Valued at
P228,608.32; c) Declaring the plaintiff to be the sole and absolute owner of the above-mentioned real and
personal properties; d) Awarding moral damages to plaintiff in an amount deemed reasonable by the trial
court;
e) To reimburse plaintiff the sum of P12,000.00 as attorney's fees for having compelled the plaintiff to
litigate; f) To reimburse plaintiff the sum of P5,000.00 incurred as litigation expenses also for having
compelled the plaintiff to litigate; and g) To pay the costs of this suit;
Plaintiff prays other reliefs just and equitable in the premises.37
In her answer, Ederlina denied all the material allegations in the complaint, insisting that she acquired the
said properties with her personal funds, and as such, Alfred had no right to the same. She alleged that the
deeds of sale, the receipts, and certificates of titles of the subject properties were all made out in her name.38
By way of special and affirmative defense, she alleged that Alfred had no cause of action against her. She
interposed counterclaims against the petitioner.39
In the meantime, the petitioner filed a Complaint dated August 25, 1987, against the HSBC in the Regional
Trial Court of Davao City40 for recovery of bank deposits and damages.41 He prayed that after due
proceedings, judgment be rendered in his favor, thus:
WHEREFORE, plaintiff respectfully prays that the Honorable Court adjudge defendant bank, upon hearing the
evidence that the parties might present, to pay plaintiff:
ONE HUNDRED TWENTY SIX THOUSAND TWO HUNDRED AND THIRTY U.S. DOLLARS AND
NINETY EIGHT CENTS (US$126,230.98) plus legal interests, either of Hong Kong or of the Philippines,
from 20 December 1984 up to the date of execution or satisfaction of judgment, as actual damages or
in restoration of plaintiffs lost dollar savings;
The same amount in (1) above as moral damages;
Attorney's fees in the amount equivalent to TWENTY FIVE PER CENT (25%) of (1) and (2) above;
Litigation expenses in the amount equivalent to TEN PER CENT (10%) of the amount in (1) above;
and
For such other reliefs as are just and equitable under the circumstances.42
On April 28, 1986, the RTC of Quezon City rendered its decision in Civil Case No. Q-46350, in favor of
Alfred, the decretal portion of which reads as follows:
WHEREFORE, premises considered, judgment is hereby rendered ordering the defendant to perform
the following:
To execute a document waiving her claim to the house and lot in No. 14 Fernandez St., San Francisco
Del Monte, Quezon City in favor of plaintiff or to return to the plaintiff the acquisition cost of the same
in the amount of $20,000.00, or to sell the said property and turn over the proceeds thereof to the
plaintiff;
To deliver to the plaintiff the rights of ownership and management of the beauty parlor located at 444
Arquiza St., Ermita, Manila, including the equipment and fixtures therein;
To account for the earnings of rental of the house and lot in No. 14 Fernandez St., San Francisco Del
Monte, Quezon City, as well as the earnings in the beauty parlor at 444 Arquiza St., Ermita, Manila
and turn over one-half of the net earnings of both properties to the plaintiff;
To surrender or return to the plaintiff the personal properties of the latter left in the house at San
Francisco Del Monte, to wit:
To return to the plaintiff, (1) Hi-Fi Stereo equipment left at 444 Arquiza Street, Ermita, Manila, as well
as the Fronte Suzuki car.
To account for the monies (sic) deposited with the joint account of the plaintiff and defendant (Account
No. 018-0-807950); and to restore to the plaintiff all the monies (sic) spent by the defendant without
proper authority;
To pay the amount of P5,000.00 by way of attorney's fees, and the costs of suit.
SO ORDERED.43
However, after due proceedings in the RTC of Davao City, in Civil Case No. 17,817, the trial court rendered
judgment on September 28, 1995 in favor of Ederlina, the dispositive portion of which reads: WHEREFORE,
the Court cannot give due course to the complaint and hereby orders its dismissal. The counterclaims of the
defendant are likewise dismissed.
The trial court ruled that based on documentary evidence, the purchaser of the three parcels of land subject
of the complaint was Ederlina. The court further stated that even if Alfred was the buyer of the properties; he
had no cause of action against Ederlina for the recovery of the same because as an alien, he was
disqualified from acquiring and owning lands in the Philippines. The sale of the three parcels of land to the
petitioner was null and void ab initio. Applying the pari delicto doctrine, the petitioner was precluded from
recovering the properties from the respondent.
Alfred appealed the decision to the Court of Appeals45 in which the petitioner posited the view that although
he prayed in his complaint in the court a quo that he be declared the owner of the three parcels of land, he
had no intention of owning the same permanently. His principal intention therein was to be declared the
transient owner for the purpose of selling the properties at public auction, ultimately enabling him to recover
the money he had spent for the purchase thereof.
On March 8, 2000, the CA rendered a decision affirming in toto the decision of the RTC. The appellate court
ruled that the petitioner knowingly violated the Constitution; hence, was barred from recovering the money
used in the purchase of the three parcels of land. It held that to allow the petitioner to recover the money
used for the purchase of the properties would embolden aliens to violate the Constitution, and defeat, rather
than enhance, the public policy.46
Hence, the petition at bar.
The petitioner assails the decision of the court contending that:
THE HONORABLE COURT OF APPEALS ERRED IN APPLYING THE RULE OF IN PARI DELICTO IN THE
INSTANT CASE BECAUSE BY THE FACTS AS NARRATED IN THE DECISION IT IS APPARENT THAT THE
PARTIES ARE NOT EQUALLY GUILTY BUT RATHER IT WAS THE RESPONDENT WHO EMPLOYED FRAUD
AS WHEN SHE DID NOT INFORM PETITIONER THAT SHE WAS ALREADY MARRIED TO ANOTHER
GERMAN NATIONAL AND WITHOUT SUCH FRAUDULENT DESIGN PETITIONER COULD NOT HAVE
PARTED WITH HIS MONEY FOR THE PURCHASE OF THE PROPERTIES.47
and
THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE INTENTION OF THE
PETITIONER IS NOT TO OWN REAL PROPERTIES IN THE PHILIPPINES BUT TO SELL THEM AT PUBLIC
AUCTION TO BE ABLE TO RECOVER HIS MONEY USED IN PURCHASING THEM.48
Since the assignment of errors are intertwined with each other, the Court shall resolve the same
simultaneously. The petitioner contends that he purchased the three parcels of land subject of his complaint
because of his desire to marry the respondent, and not to violate the Philippine Constitution. He was,
however, deceived by the respondent when the latter failed to disclose her previous marriage to Klaus Muller.
It cannot, thus, be said that he and the respondent are "equally guilty;" as such, the pari delicto doctrine is
not applicable to him. He acted in good faith, on the advice of the respondent's uncle, Atty. Mardoecheo
Camporedondo. There is no evidence on record that he was aware of the constitutional prohibition against
aliens acquiring real property in the Philippines when he purchased the real properties subject of his
complaint with his own funds. The transactions were not illegal per se but merely prohibited, and under Article
1416 of the New Civil Code, he is entitled to recover the money used for the purchase of the properties. At
any rate, the petitioner avers, he filed his complaint in the court a quo merely for the purpose of having him
declared as the owner of the properties, to enable him to sell the same at public auction. Applying by analogy
Republic Act No. 13349 as amended by Rep. Act No. 4381 and Rep. Act No. 4882, the proceeds of the sale
would be remitted to him, by way of refund for the money he used to purchase the said properties. To bar the
petitioner from recovering the subject properties, or at the very least, the money used for the purchase
thereof, is to allow the respondent to enrich herself at the expense of the petitioner in violation of Article 22 of
the New Civil Code. The petition is bereft of merit.
Section 14, Article XIV of the 1973 Constitution provides, as follows: Save in cases of hereditary succession,
no private land shall be transferred or conveyed except to individuals, corporations, or associations qualified
to acquire or hold lands in the public domain.50
Lands of the public domain, which include private lands, may be transferred or conveyed only to individuals
or entities qualified to acquire or hold private lands or lands of the public domain. Aliens, whether individuals
or corporations, have been disqualified from acquiring lands of the public domain. Hence, they have also
been disqualified from acquiring private lands.51 Even if, as claimed by the petitioner, the sales in question
were entered into by him as the real vendee, the said transactions are in violation of the Constitution; hence,
are null and void ab initio.52 A contract that violates the Constitution and the law, is null and void and vests
no rights and creates no obligations. It produces no legal effect at all.53 The petitioner, being a party to an
illegal contract, cannot come into a court of law and ask to have his illegal objective carried out. One who
loses his money or property by knowingly engaging in a contract or transaction which involves his own moral
turpitude may not maintain an action for his losses. To him who moves in deliberation and premeditation, the
law is unyielding.54 The law will not aid either party to an illegal contract or agreement; it leaves the parties
where it finds them.55 Under Article 1412 of the New Civil Code, the petitioner cannot have the subject
properties deeded to him or allow him to recover the money he had spent for the purchase thereof.56 Equity
as a rule will follow the law and will not permit that to be done indirectly which, because of public policy,
cannot be done directly.57 Where the wrong of one party equals that of the other, the defendant is in the
stronger position . . . it signifies that in such a situation, neither a court of equity nor a court of law will
administer a remedy.58 The rule is expressed. in the maxims: EX DOLO ORITUR ACTIO and IN PARI
DELICTO POTIOR EST CONDITIO DEFENDENTIS.59
The petitioner cannot feign ignorance of the constitutional proscription, nor claim that he acted in good faith,
let alone assert that he is less guilty than the respondent. The petitioner is charged with knowledge of the
constitutional prohibition.60 As can be gleaned from the decision of the trial court, the petitioner was fully
aware that he was disqualified from acquiring and owning lands under Philippine law even before he
purchased the properties in question; and, to skirt the constitutional prohibition, the petitioner had the deed of
sale placed under the respondent's name as the sole vendee thereof: Such being the case, the plaintiff is
subject to the constitutional restrictions governing the acquisition of real properties in the Philippines by aliens.
From the plaintiff's complaint before the Regional Trial Court, National Capital Judicial Region, Branch 84,
Quezon City in Civil Case No. Q-46350 he alleged: "That on account that foreigners are not allowed by the
Philippine laws to acquire real properties in their name as in the case of my vendor Miss Victoria Vinuya (sic)
although married to a foreigner, we agreed and I consented in having the title to subject property placed in
defendant's name alone although I paid for the whole price out of my own exclusive funds.
It is evident that the plaintiff was fully aware that as a non-citizen of the Philippines, he was disqualified from
validly purchasing any land within the country.61 The petitioner's claim that he acquired the subject properties
because of his desire to marry the respondent, believing that both of them would thereafter jointly own the
said properties, is belied by his own evidence. It is merely an afterthought to salvage a lost cause. The
petitioner admitted on cross-examination that he was all along legally married to Teresita Santos Frenzel,
while he was having an amorous relationship with the respondent. The respondent was herself married to
Klaus Muller, a German citizen. Thus, the petitioner and the respondent could not lawfully join in wedlock.
The evidence on record shows that the petitioner in fact knew of the respondent's marriage to another man,
but nonetheless purchased the subject properties under the name of the respondent and paid the purchase
prices therefor. Even if it is assumed gratia arguendi that the respondent and the petitioner were capacitated
to marry, the petitioner is still disqualified to own the properties in tandem with the respondent.63
The petitioner cannot find solace in Article 1416 of the New Civil Code which reads: Art. 1416. When the
agreement is not illegal per se but is merely prohibited, and the prohibition by the law is designed for the
protection of the plaintiff, he may, if public policy is thereby enhanced, recover what he has paid or
delivered.64
The provision applies only to those contracts which are merely prohibited, in order to benefit private
interests. It does not apply to contracts void ab initio. The sales of three parcels of land in favor of the
petitioner who is a foreigner is illegal per se. The transactions are void ab initio because they were entered
into in violation of the Constitution. Thus, to allow the petitioner to recover the properties or the money used
in the purchase of the parcels of land would be subversive of public policy.
Neither may the petitioner find solace in Rep. Act No. 133, as amended by Rep. Act No. 4882, which reads:
SEC. 1. Any provision of law to the contrary notwithstanding, private real property may be mortgaged
in favor of any individual, corporation, or association, but the mortgagee or his successor-in-interest, if
disqualified to acquire or hold lands of the public domain in the Philippines, shall not take possession
of the mortgaged property during the existence of the mortgage and shall not take possession of
mortgaged property except after default and for the sole purpose of foreclosure, receivership,
enforcement or other proceedings and in no case for a period of more than five years from actual
possession and shall not bid or take part in any sale of such real property in case of foreclosure:
Provided, That said mortgagee or successor-in-interest may take possession of said property after
default in accordance with the prescribed judicial procedures for foreclosure and receivership and in no
case exceeding five years from actual possession.65
From the evidence on record, the three parcels of land subject of the complaint were not mortgaged to the
petitioner by the owners thereof but were sold to the respondent as the vendee, albeit with the use of the
petitioner's personal funds.
Futile, too, is petitioner's reliance on Article 22 of the New Civil Code which reads:
Art. 22. Every person who through an act of performance by another, or any other means, acquires or
comes into possession of something at the expense of the latter without just or legal ground, shall
return the same to him.66
The provision is expressed in the maxim: "MEMO CUM ALTERIUS DETER DETREMENTO PROTEST" (No
person should unjustly enrich himself at the expense of another). An action for recovery of what has been
paid without just cause has been designated as an accion in rem verso.67 This provision does not apply if, as
in this case, the action is proscribed by the Constitution or by the application of the pari delicto doctrine. It
may be unfair and unjust to bar the petitioner from filing an accion in rem verso over the subject properties,
or from recovering the money he paid for the said properties, but, as Lord Mansfield stated in the early case
of Holman vs. Johnson:69 "The objection that a contract is immoral or illegal as between the plaintiff and the
defendant, sounds at all times very ill in the mouth of the defendant. It is not for his sake, however, that the
objection is ever allowed; but it is founded in general principles of policy, which the defendant has the
advantage of, contrary to the real justice, as between him and the plaintiff."
IN LIGHT OF ALL THE FOREGOING, the petition is DISMISSED. The decision of the Court of Appeals is
AFFIRMED in toto. Costs against the petitioner. SO ORDERED.
G.R. No. L-34672 March 30,1988
UNITED CHURCH BOARD FOR WORLD MINISTRIES, as owner of BROKENSHIRE MEMORIAL
HOSPITAL,petitioner, vs. HON. JUDGE ALEJANDRO E. SEBASTIAN, as Presiding Judge of the CFI of
Davao del Norte, and MELENCIO B. DELENA and MAURO GEMENTIZA as Co-Executors of the Testate
Estate of DAVID, Jacobson, respondents.
This case is unusual because it arose not out of greed but of generosity. The only question to be resolved is
the Identity and eligibility of the beneficiary in the light of the pertinent constitutional provisions and the
evidence of record.
David Jacobson was an American citizen who had been a resident of the Philippines for more than thirty
years and up to the time of his death in 1970. 1 He left a will in which he "devised and bequeathed" to the
Brokenshire Memorial Hospital 60% of his shares of stocks in the Tagdangua Plantation Co., inc. which was
incorporated under Philippine law in 1948. 2 This corporation was the registered owner of a tract of land in
Pantuhan Davao del Norte, with a total area of about 445 hectares acquired by virtue of a sales patent
issued to it in 11953 . 3
In Special Proceeding No. 1695 of the Court of First Instance of Davao del Norte, Judge Alejandro E.
Sebastian disallowed the above-described legacy on the ground that it was in effect an alienation of private
agricultural land in favor of a transferee which was not qualified under the Constitution of 1935. 4 The finding
was that the Brokenshire Memorial Hospital was owned by the United Church Board for World Ministries
(UCBWM) ,the herein petitioner, which was a non-stock corporation organized in the United States by virtue
of a charter granted by the state legislature of Massachussets . 5
The basis of this ruling was Article XII, Sections I and 5 of the 1935 Constitution, which barred foreigners,
including Americans, from acquiring agricultural lands in this country except only by hereditary succession.
The court directed that a copy of its order be sent to the Solicitor General so he could take the proper action,
in view of the invalidity of the transfer, for the escheat of the subject property to the State. 6
Its motion for reconsideration having been denied, the petitioner came to this Court, contending that the
above-cited constitutional provisions were not applicable because the object of the legacy was not land but
shares of stocks. Moreover, even assuming that what was really involved was a transfer of land, the
petitioner was nonetheless qualified to acquire it under the provisions of the Parity Amendment and the
Laurel-Langley Agreement.
The Solicitor General disagreed at first, insisting that the legacy was prohibited by the 1935 Constitution and
did not come under any of the allowed exceptions. During the protracted exchange of pleadings among the
parties, however, certain events transpired to considerably change the original situation and, consequently,
also the position of government.
It now appears from the voluminous documents submitted in this case that at the time the will was executed
in 1966, the land on which the Brokenshire Memorial Hospital was situated was already registered in the
name of the Mindanao District Conference, an affiliate of the United Church of Christ in the Philippines
(PUCC). 7 It was this non-stock corporation, organized in 1949 under Philippine law with a 100% Filipino
membership, that owned and was operating the Hospital at the time of Jacobson's death. 8 Later, the
Brokenshire Memorial Hospital was itself incorporated as a charitable institution, with Filipinos constituting the
majority of its membership, 9 and on December 16,1970, became the successor-in-interest of the UCCP to
the devised parcel of land. 10
In proof of these circumstances, the new counsel for Brokenshire presented, among many other documents,
the articles of incorporation of the UCCP and the Hospital and their corresponding certificates of registration
issued by the Securities and Exchange Commission, the licenses issued by the Board of Medical Sciences
for the operation of the Hospital to the UCCP from 1968 to 1972 and to the Brokenshire Memorial Hospital,
Inc. from 1973 to 1974, and the certificate of title over the subject land in the name of the "Mindanao District
Conference, commonly known as the Brokenshire Memorial Hospital." 11
These facts were not brought earlier to the attention of the probate court by the former counsel of the
Hospital, Atty. Juan V. Faune for reasons that do not appear in the record. It was for such omission (the new
counsel would call it "misrepresentation") that Atty. Faune was replaced by Atty. Rodolfo D. de la Cruz, who
disavowed his predecessor's representations. At any rate, the above-stated documents have now made it
clear that the United Church for Christ in the Philippines and not the United Church Board for World
Ministries was the owner of the Hospital at the time of the execution of the win in 1966 and of the testator's
death in 1970. It is also not disputed that such ownership passed to the Brokenshire Memorial Hospital itself
upon its incorporation in 1970 when it thus became the proper party-in-interest to claim the property directly
devised by Jacobson to it.
That the United Church Board for World Ministries no longer claims the subject property (if indeed it really did
claim it before), is manifest in its sur rejoinder to the rejoinder of the movant Brokenshire Memorial Hospital,
Inc., which had asked to be substituted for the former as petitioner in this case. The body of this pleading is
reproduced in full as follows:
PETITIONER, by the Undersigned Counsel, to this Honorable Court most respectfully states:
1. That upon its organization in 1948 the United Church of Christ in the Philippines succeeded to the religious
work, service and mission of the United Church Board for World Ministries and other religion boards in the
United States of America;
2. It was the intention, following the independence of the Philippines from the U.S.A. the constitution of an
independent and autonomous United Church of Christ in the Philippines, to eventually transfer all properties,
schools, and hospitals established by said mission boards, to the United Church of Christ in the Philippines;
3. That the United Church Board for World Ministries had, in fact, transferred the ownership of most of its
properties in the Philippines to the United Church of Christ in the Philippines, its religious organizations
and/or instrumentalities;
4. That when the Brokenshire Memorial Hospital was destroyed by fire in 1964, reconstruction efforts and
responsibilities was assumed by the United Church of Christ in the Philippines, it was the intention of the
United Church Board for World Ministries to relinquish the rights, interests and ownership to the Brokenshire
Memorial Hospital, now Brokenshire Memorial Hospital, Inc. and considered it so relinquished, with
continuing funding assistance from the United Church Board for World Ministries and other mission boards
overseas;
5. The United Church Board for World Ministries continues to this date, with its fraternal and cooperative
relationship with the United Church of Christ in the Philippines;
6. That as has already been stated, the United Church Board for World Ministries does not intend to take,
possess, or enjoy the legacy of David Jacobson and has manifested and mandated that all properties that
may be derived therefrom shall be used entirely and exclusively for the work of the Brokenshire Memorial
Hospital and its School of Nursing in accordance with the wishes of David Jacobson;
7. Considering the clear intention of David Jacobson to support the life and work of Brokenshire Memorial
Hospital and its School of Nursing, and further considering that what was bequeathed are shares of stocks
in a corporation,, there exists no legal and moral impediment for the legacy to be delivered to the
Brokenshire Memorial Hospital, Inc., an instrumentality of the United Church of Christ in the Philippines, that
has succeeded to the ownership of and the humanitarian, and charitable service of said Hospital.
Parenthetically, it should be observed, in fairness to Judge Sebastian, that he was unaware of these
circumstances when he declared the legacy invalid to enforce the nationalistic provisions of Article XIII of the
1935 Constitution. For his vigilance in the protection of the national patrimony, he should be, as he is hereby,
commenced.
Even on the assumption that the UCBWN was really the owner of the Hospital at the time of the effectivity of
the will and that the devise was for that reason unenforceable, the defect in the will should be deemed
rectified by the subsequent transfer of the property to the Brokenshire Memorial Hospital, Inc. Our consistent
ruling on this matter is that if land is invalidly transferred to an alien who subsequently becomes a citizen or
transfers it to a ctitizen, the flaw in the original transaction is considered cured and the title of the transferee
is rendered valid.
Thus, in Sarsosa vda. de Barsobia v. Cuenco, 13 where a Filipino citizen sold her land to an alien who later
sold it to a Filipino, we held that the invalidity of the initial transfer to the alien was corrected by the
subsequent transfer of the property to a citizen. A similar ruling was made in Godinez v. Fong Pak Luen, 14
involving a similar set of facts, where we also cited Vasquez v. Li Seng Giap, 15 and Herrera v. Luy King
Guan. 16 In Yap v. Maravillas, 17we validated the sale of agricultural land to an alien who, after the purchase,
was naturalized as a Filipino and so became qualified to acquire it. The facts were slightly different in De
Castro v. Teng, 18 where, upon the death of an alien who had purchased a residential lot, his heirs entered
into an extrajudicial partition of his estate and transferred the land to one of his sons who was a naturalized
Filipino. We also sustained the sale.
This action has been pending for quite some time now because of the confusion regarding the status of the
Brokenshire Memorial Hospital as the ultimate beneficiary of the challenged legacy. The curious thing is that
this case was mired in factual and legal complications caused by needless misunderstanding among the
parties which, it now appears, were never in any substantial disagreement over the ownership of the Hospital.
Their common concern for its welfare, in line with the charitable spirit and purposes of the testator, should
have avoided all this tedious and acrimonious dispute.
WHEREFORE, the Brokenshire Memorial Hospital, Inc. is hereby substituted for the United Church Board for
World Ministries as petitioner in this case and DECLARED to be qualified to accept the legacy of the late
David Jacobson. The petition as thus modified is GRANTED. The order of the respondent judge dated
December 9, 1971, and his Resolution dated December 9, 1971, are SET ASIDE. This decision is
immediately executory. No costs.
G.R. No. 73002 December 29, 1986
THE DIRECTOR OF LANDS, petitioner, vs. INTERMEDIATE APPELLATE COURT and ACME PLYWOOD
& VENEER CO. INC., ETC., respondents.
The Director of Lands has brought this appeal by certiorari from a judgment of the Intermediate Appellate
Court affirming a decision of the Court of First Instance of Isabela, which ordered registration in favor of
Acme Plywood & Veneer Co., Inc. of five parcels of land measuring 481, 390 square meters, more or less,
acquired by it from Mariano and Acer Infiel, members of the Dumagat tribe.
The registration proceedings were for confirmation of title under Section 48 of Commonwealth Act No. 141
(The Public Land Act). as amended: and the appealed judgment sums up the findings of the trial court in said
proceedings in this wise:
That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario is a corporation duly
organized in accordance with the laws of the Republic of the Philippines and registered with the Securities
and Exchange Commission on December 23, 1959;
That Acme Plywood & Veneer Co. Inc., represented by Mr. Rodolfo Nazario can acquire real properties
pursuant to the provisions of the Articles of Incorporation particularly on the provision of its secondary
purposes (paragraph (9), Exhibit 'M-l');
That the land subject of the Land Registration proceeding was ancestrally acquired by Acme Plywood
& Veneer Co., Inc., on October 29, 1962, from Mariano Infiel and Acer Infiel, both members of the Dumagat
tribe and as such are cultural minorities;
That the constitution of the Republic of the Philippines of 1935 is applicable as the sale took place on
October 29, 1962;
That the possession of the Infiels over the land relinquished or sold to Acme Plywood & Veneer Co.,
Inc., dates back before the Philippines was discovered by Magellan as the ancestors of the Infiels have
possessed and occupied the land from generation to generation until the same came into the possession of
Mariano Infiel and Acer Infiel;
That the possession of the applicant Acme Plywood & Veneer Co., Inc., is continuous, adverse and
public from 1962 to the present and tacking the possession of the Infiels who were granted from whom the
applicant bought said land on October 29, 1962, hence the possession is already considered from time
immemorial.
That the land sought to be registered is a private land pursuant to the provisions of Republic Act No.
3872 granting absolute ownership to members of the non-Christian Tribes on land occupied by them or their
ancestral lands, whether with the alienable or disposable public land or within the public domain;
That applicant Acme Plywood & Veneer Co. Inc., has introduced more than Forty-Five Million
(P45,000,000.00) Pesos worth of improvements, said improvements were seen by the Court during its ocular
investigation of the land sought to be registered on September 18, 1982;
That the ownership and possession of the land sought to be registered by the applicant was duly
recognized by the government when the Municipal Officials of Maconacon, Isabela, have negotiated for the
donation of the townsite from Acme Plywood & Veneer Co., Inc., and this negotiation came to reality when
the Board of Directors of the Acme Plywood & Veneer Co., Inc., had donated a part of the land bought by the
Company from the Infiels for the townsite of Maconacon Isabela (Exh. 'N') on November 15, 1979, and which
donation was accepted by the Municipal Government of Maconacon, Isabela (Exh. 'N-l'), during their special
session on November 22, 1979. The Director of Lands takes no issue with any of these findings except as to
the applicability of the 1935 Constitution to the matter at hand. Concerning this, he asserts that, the
registration proceedings have been commenced only on July 17, 1981, or long after the 1973 Constitution
had gone into effect, the latter is the correctly applicable law; and since section 11 of its Article XIV prohibits
private corporations or associations from holding alienable lands of the public domain, except by lease not to
exceed 1,000 hectares (a prohibition not found in the 1935 Constitution which was in force in 1962 when
Acme purchased the lands in question from the Infiels), it was reversible error to decree registration in favor
of Acme Section 48, paragraphs (b) and (c), of Commonwealth Act No. 141, as amended, reads:
SEC. 48. The following described citizens of the Philippines, occupying lands of the public domain or
claiming to own any such lands or an interest therein, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the province where the land is located for
confirmation of their claims, and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:
(b) Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of agricultural lands of the public domain, under a
bona fide claim of acquisition or ownership, for at least thirty years immediately preceding the filing of
the application for confirmation of title except when prevented by war or force majeure. These shall be
conclusively presumed to have performed all the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this chapter.
(c) Members of the National Cultural minorities who by themselves or through their
predecessors-in-interest have been in open. continuous, exclusive and notorious possession and
occupation of lands of the public domain suitable to agriculture, whether disposable or not, under a
bona fide claim of ownership for at least 30 years shall be entitled to the rights granted in subsection
(b) hereof.
The Petition for Review does not dispute-indeed, in view of the quoted findings of the trial court which were
cited and affirmed by the Intermediate Appellate Court, it can no longer controvert before this Court-the fact
that Mariano and Acer Infiel, from whom Acme purchased the lands in question on October 29, 1962, are
members of the national cultural minorities who had, by themselves and through their progenitors, possessed
and occupied those lands since time immemorial, or for more than the required 30-year period and were, by
reason thereof, entitled to exercise the right granted in Section 48 of the Public Land Act to have their title
judicially confirmed. Nor is there any pretension that Acme, as the successor-in-interest of the Infiels, is
disqualified to acquire and register ownership of said lands under any provisions of the 1973 Constitution
other than Section 11 of its Article XIV already referred to.
Given the foregoing, the question before this Court is whether or not the title that the Infiels had
transferred to Acme in 1962 could be confirmed in favor of the latter in proceedings instituted by it in
1981 when the 1973 Constitution was already in effect, having in mind the prohibition therein against
private corporations holding lands of the public domain except in lease not exceeding 1,000 hectares.
The question turns upon a determination of the character of the lands at the time of institution of the
registration proceedings in 1981. If they were then still part of the public domain, it must be answered in the
negative. If, on the other hand, they were then already private lands, the constitutional prohibition against
their acquisition by private corporations or associations obviously does not apply.
In this regard, attention has been invited to Manila Electric Company vs. Castro-Bartolome, et al, 1 where a
similar set of facts prevailed. In that case, Manila Electric Company, a domestic corporation more than 60%
of the capital stock of which is Filipino-owned, had purchased in 1947 two lots in Tanay, Rizal from the
Piguing spouses. The lots had been possessed by the vendors and, before them, by their
predecessor-in-interest, Olimpia Ramos, since prior to the outbreak of the Pacific War in 1941. On December
1, 1976, Meralco applied to the Court of First Instance of Rizal, Makati Branch, for confirmation of title to said
lots. The court, assuming that the lots were public land, dismissed the application on the ground that Meralco,
a juridical person, was not qualified to apply for registration under Section 48(b) of the Public Land Act which
allows only Filipino citizens or natural persons to apply for judicial confirmation of imperfect titles to public
land. Meralco appealed, and a majority of this Court upheld the dismissal. It was held that: the said land is
still public land. It would cease to be public land only upon the issuance of the certificate of title to any
Filipino citizen claiming it under section 48(b). Because it is still public land and the Meralco, as a juridical
person, is disqualified to apply for its registration under section 48(b), Meralco's application cannot be given
due course or has to be dismissed. Finally, it may be observed that the constitutional prohibition makes no
distinction between (on the one hand) alienable agricultural public lands as to which no occupant has an
imperfect title and (on the other hand) alienable lands of the public domain as to which an occupant has on
imperfect title subject to judicial confirmation. Since section 11 of Article XIV does not distinguish, we should
not make any distinction or qualification. The prohibition applies to alienable public lands as to which a
Torrens title may be secured under section 48(b). The proceeding under section 48(b) 'presupposes that the
land is public' (Mindanao vs. Director of Lands, L-19535, July 30, 1967, 20 SCRA 641, 644).
The present Chief Justice entered a vigorous dissent, tracing the line of cases beginning with Carino in 1909
2
thru Susi in 1925 3 down to Herico in 1980, 4 which developed, affirmed and reaffirmed the doctrine that
open, exclusive and undisputed possession of alienable public land for the period prescribed by law creates
the legal fiction whereby the land, upon completion of the requisite period ipso jure and without the need of
judicial or other sanction, ceases to be public land and becomes private property. That said dissent
expressed what is the better and, indeed, the correct, view-becomes evident from a consideration of some
of the principal rulings cited therein,
The main theme was given birth, so to speak, in Carino involving the Decree/Regulations of June 25, 1880
for adjustment of royal lands wrongfully occupied by private individuals in the Philippine Islands. It was ruled
that: It is true that the language of articles 4 and 5 5 attributes title to those 'who may prove' possession for
the necessary time and we do not overlook the argument that this means may prove in registration
proceedings. It may be that an English conveyancer would have recommended an application under the
foregoing decree, but certainly it was not calculated to convey to the mind of an Igorot chief the notion that
ancient family possessions were in danger, if he had read every word of it. The words 'may prove' (acrediten)
as well or better, in view of the other provisions, might be taken to mean when called upon to do so in any
litigation. There are indications that registration was expected from all but none sufficient to show that, for
want of it, ownership actually gained would be lost. The effect of the proof, wherever made, was not to confer
title, but simply to establish it, as already conferred by the decree, if not by earlier law. ...
That ruling assumed a more doctrinal character because expressed in more categorical language, in Susi:
.... In favor of Valentin Susi, there is, moreover, the presumption juris et de jure established in
paragraph (b) of section 45 of Act No. 2874, amending Act No. 926, that all the necessary
requirements for a grant by the Government were complied with, for he has been in actual and
physical possession, personally and through his predecessors, of an agricultural land of the public
domain openly, continuously, exclusively and publicly since July 26, 1984, with a right to a certificate of
title to said land under the provisions of Chapter VIII of said Act. So that when Angela Razon applied
for the grant in her favor, Valentin Susi had 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 should be issued in
order that said grant may be sanctioned by the courts, an application therefore is sufficient, under the
provisions of section 47 of Act No. 2874. If by a legal fiction, Valentin Susi had acquired the land in
question by a grant of the State, it had already ceased to be of the public domain and had become
private property, at least by presumption, of Valentin Susi, beyond the control of the Director of Lands.
Consequently, in selling the land in question of Angela Razon, the Director of Lands disposed of a land
over which he had no longer any title or control, and the sale thus made was void and of no effect,
and Angela Razon did not thereby acquire any right. 6
Succeeding cases, of which only some need be mentioned, likeof Lacaste vs. Director of Lands, 7 Mesina vs.
Vda. de Sonza, 8 Manarpac vs. Cabanatuan, 9 Miguel vs. Court of Appeals 10 and Herico vs. Dar, supra, by
invoking and affirming the Susi doctrine have firmly rooted it in jurisprudence.
Herico, in particular, appears to be squarely affirmative: Secondly, under the provisions of Republic Act No.
1942, which the respondent Court held to be inapplicable to the petitioner's case, with the latter's proven
occupation and cultivation for more than 30 years since 1914, by himself and by his predecessors-in-interest,
title over the land has vested on petitioner so as to segregate the land from the mass of public land.
Thereafter, it is no longer disposable under the Public Land Act as by free patent. ....
As interpreted in several cases, when the conditions as specified in the foregoing provision are
complied with, the possessor is deemed to have acquired, by operation of law, a right to a grant, a
government grant, without the necessity of a certificate of title being issued. The land, therefore,
ceases to be of the public domain and beyond the authority of the Director of Lands to dispose of. The
application for confirmation is mere formality, the lack of which does not affect the legal sufficiency of
the title as would be evidenced by the patent and the Torrens title to be issued upon the strength of
said patent. 12
Nothing can more clearly demonstrate the logical inevitability of considering possession of public land which
is of the character and duration prescribed by statute as the equivalent of an express grant from the State
than the dictum of the statute itself 13 that the possessor(s) "... shall be conclusively presumed to have
performed all the conditions essential to a Government grant and shall be entitled to a certificate of title .... "
No proof being admissible to overcome a conclusive presumption, confirmation proceedings would, in truth be
little more than a formality, at the most limited to ascertaining whether the possession claimed is of the
required character and length of time; and registration thereunder would not confer title, but simply recognize
a title already vested. The proceedings would not originally convert the land from public to private land, but
only confirm such a conversion already affected by operation of law from the moment the required period of
possession became complete. As was so well put in Carino, "... (T)here are indications that registration was
expected from all, but none sufficient to show that, for want of it, ownership actually gained would be lost.
The effect of the proof, wherever made, was not to confer title, but simply to establish it, as already conferred
by the decree, if not by earlier law."
If it is accepted-as it must be-that the land was already private land to which the Infiels had a legally sufficient
and transferable title on October 29, 1962 when Acme acquired it from said owners, it must also be
conceded that Acme had a perfect right to make such acquisition, there being nothing in the 1935
Constitution then in force (or, for that matter, in the 1973 Constitution which came into effect later) prohibiting
corporations from acquiring and owning private lands.
Even on the proposition that the land remained technically "public" land, despite immemorial possession of
the Infiels and their ancestors, until title in their favor was actually confirmed in appropriate proceedings under
the Public Land Act, there can be no serious question of Acmes right to acquire the land at the time it did,
there also being nothing in the 1935 Constitution that might be construed to prohibit corporations from
purchasing or acquiring interests in public land to which the vendor had already acquired that type of
so-called "incomplete" or "imperfect" title. The only limitation then extant was that corporations could not
acquire, hold or lease public agricultural lands in excess of 1,024 hectares. The purely accidental
circumstance that confirmation proceedings were brought under the aegis of the 1973 Constitution which
forbids corporations from owning lands of the public domain cannot defeat a right already vested before that
law came into effect, or invalidate transactions then perfectly valid and proper. This Court has already held, in
analogous circumstances, that the Constitution cannot impair vested rights. We hold that the said
constitutional prohibition 14 has no retroactive application to the sales application of Binan Development Co.,
Inc. because it had already acquired a vested right to the land applied for at the time the 1973 Constitution
took effect. That vested right has to be respected. It could not be abrogated by the new Constitution. Section
2, Article XIII of the 1935 Constitution allows private corporations to purchase public agricultural lands not
exceeding one thousand and twenty-four hectares. Petitioner' prohibition action is barred by the doctrine of
vested rights in constitutional law. The due process clause prohibits the annihilation of vested rights. 'A state
may not impair vested rights by legislative enactment, by the enactment or by the subsequent repeal of a
municipal ordinance, or by a change in the constitution of the State, except in a legitimate exercise of the
police power. In the instant case, it is incontestable that prior to the effectivity of the 1973 Constitution the
right of the corporation to purchase the land in question had become fixed and established and was no
longer open to doubt or controversy. Its compliance with the requirements of the Public Land Law for the
issuance of a patent had the effect of segregating the said land from the public domain. The corporation's
right to obtain a patent for the land is protected by law. It cannot be deprived of that right without due process
(Director of Lands vs. CA, 123 Phil. 919).
The fact, therefore, that the confirmation proceedings were instituted by Acme in its own name must be
regarded as simply another accidental circumstance, productive of a defect hardly more than procedural and
in nowise affecting the substance and merits of the right of ownership sought to be confirmed in said
proceedings, there being no doubt of Acme's entitlement to the land. As it is unquestionable that in the light
of the undisputed facts, the Infiels, under either the 1935 or the 1973 Constitution, could have had title in
themselves confirmed and registered, only a rigid subservience to the letter of the law would deny the same
benefit to their lawful successor-in-interest by valid conveyance which violates no constitutional mandate.
The Court, in the light of the foregoing, is of the view, and so holds, that the majority ruling in Meralco must
be reconsidered and no longer deemed to be binding precedent. The correct rule, as enunciated in the line of
cases already referred to, is that alienable public land held by a possessor, personally or through his
predecessors-in-interest, openly, continuously and exclusively for the prescribed statutory period (30 years
under The Public Land Act, as amended) is converted to private property by the mere lapse or completion of
said period, ipso jure. Following that rule and on the basis of the undisputed facts, the land subject of this
appeal was already private property at the time it was acquired from the Infiels by Acme. Acme thereby
acquired a registrable title, there being at the time no prohibition against said corporation's holding or owning
private land. The objection that, as a juridical person, Acme is not qualified to apply for judicial confirmation of
title under section 48(b) of the Public Land Act is technical, rather than substantial and, again, finds its
answer in the dissent in Meralco:
6. To uphold respondent judge's denial of Meralco's application on the technicality that the Public Land
Act allows only citizens of the Philippines who are natural persons to apply for confirmation of their title
would be impractical and would just give rise to multiplicity of court actions. Assuming that there was a
technical error not having filed the application for registration in the name of the Piguing spouses as
the original owners and vendors, still it is conceded that there is no prohibition against their sale of the
land to the applicant Meralco and neither is there any prohibition against the application being refiled
with retroactive effect in the name of the original owners and vendors (as such natural persons) with
the end result of their application being granted, because of their indisputable acquisition of ownership
by operation of law and the conclusive presumption therein provided in their favor. It should not be
necessary to go through all the rituals at the great cost of refiling of all such applications in their names
and adding to the overcrowded court dockets when the Court can after all these years dispose of it
here and now. (See Francisco vs. City of Davao)
The ends of justice would best be served, therefore, by considering the applications for confirmation as
amended to conform to the evidence, i.e. as filed in the names of the original persons who as natural
persons are duly qualified to apply for formal confirmation of the title that they had acquired by
conclusive presumption and mandate of the Public Land Act and who thereafter duly sold to the herein
corporations (both admittedly Filipino corporations duly qualified to hold and own private lands) and
granting the applications for confirmation of title to the private lands so acquired and sold or
exchanged.
There is also nothing to prevent Acme from reconveying the lands to the Infiels and the latter from
themselves applying for confirmation of title and, after issuance of the certificate/s of title in their names,
deeding the lands back to Acme. But this would be merely indulging in empty charades, whereas the same
result is more efficaciously and speedily obtained, with no prejudice to anyone, by a liberal application of the
rule on amendment to conform to the evidence suggested in the dissent in Meralco.
While this opinion seemingly reverses an earlier ruling of comparatively recent vintage, in a real sense, it
breaks no precedent, but only reaffirms and re-established, as it were, doctrines the soundness of which has
passed the test of searching examination and inquiry in many past cases. Indeed, it is worth noting that the
majority opinion, as well as the concurring opinions of Chief Justice Fernando and Justice Abad Santos, in
Meralco rested chiefly on the proposition that the petitioner therein, a juridical person, was disqualified from
applying for confirmation of an imperfect title to public land under Section 48(b) of the Public Land Act.
Reference to the 1973 Constitution and its Article XIV, Section 11, was only tangential limited to a brief
paragraph in the main opinion, and may, in that context, be considered as essentially obiter. Meralco, in short,
decided no constitutional question.
WHEREFORE, there being no reversible error in the appealed judgment of the Intermediate Appellate Court,
the same is hereby affirmed, without costs in this instance.
Separate Opinions
TEEHANKEE, C.J., concurring: I am honored by my brethren's judgment at bar that my dissenting opinion in
the June, 1982 Meralco and Iglesia ni Cristo cases, 1 which is herein upheld, "expressed what is the
better. . . . and indeed the correct view." My dissent was anchored on the landmark 1909 case of Carino 2
through the 1925 case of Susi 3 and the long line of cases cited therein to the latest 1980 case of Herico 4
that "it is established doctrine....... that an open, continuous, adverse and public possession of a land of the
public domain for the period provided in the Public Land Act provision in force at the time (from July 26, 1894
in Susi under the old law [this period was reduced to 'at least thirty years immediately preceding the filing of
the application for confirmation of title' by amendment of Commonwealth Act No. 141, equivalent to the period
of acquisitive prescription 5 ]) by a private individual personally and through his predecessors confers an
effective title on said possessor, whereby the land ceases to be land of the public domain and becomes
private property." I hereby reproduce the same by reference for brevity's sake. But since we are reverting to
the old above-cited established doctrine and precedents and discarding the Meralco and Iglesia ni Cristo
cases which departed therefrom in the recent past, I feel constrained to write this concurrence in amplification
of my views and ratio decidendi.
Under the express text and mandate of the cited Act, such possessors "shall be conclusively presumed to
have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title
under the provisions of this chapter. " The Court thus held in Susi that under the presumption juris et de jure
established in the Act, the rightful possessor of the public land for the statutory period "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
certificate of title should be issued an order that said grant may be sanctioned by the courts, an application
therefore is sufficient . . . . If by a legal fiction, Valentin Susi had acquired the land in question by a grant of
the State, it had already ceased to be of the public domain and had become private property, at least by
presumption, of Valentin Susi, beyond the control of the Director of Lands [and beyond his authority to sell to
any other person]. " 6 The root of the doctrine goes back to the pronouncement of Justice Oliver Wendell
Holmes for the U.S. Supreme Court in the 1909 case of Carino (the Igorot chief who would have been
deprived of ancestral family lands by the dismissal of his application for registration) which reversed the
dismissal of the registration court (as affirmed by the Supreme Court) and adopted the liberal view that under
the decree and regulations of June 25, 1880, "The words 'may prove' (acrediten), as well, or better, in view of
the other provisions, might be taken to mean when called upon to do so in any litigation. There are
indications that registration was expected from all, but none sufficient to show that, for want of it, ownership
actually gained would be lost. The effect of the proof, whenever made, was not to confer title, but simply to
establish it, as already conferred by the decree, if not by earlier law."
The Court's decision at bar now expressly overturns the Meralco and related cases subsequent thereto which
failed to adhere to the aforecited established doctrine dating back to 1909 and was consistently applied up to
June 29, 1982 (when the Meralco decision was promulgated). We reaffirm the established doctrine that such
acquisitive prescription of alienable public lands takes place ipso jure or by operation of law without the
necessity of a prior issuance of a certificate of title. The land ipso jure ceases to be of the public domain and
becomes private property, which may be lawfully sold to and acquired by qualified corporations such as
respondent corporation. (As stressed in Herico supra, "the application for confirmation is a mere formality, the
lack of which does not affect the legal sufficiency of the title.")
Such ipso jure conversion into private property of public lands publicly held under a bona fide claim of
acquisition or ownership is the public policy of the Act and is so expressly stated therein. By virtue of such
conversion into private property, qualified corporations may lawfully acquire them and there is no "alteration
or defeating" of the 1973 Constitution's prohibition against corporations holding or acquiring title to lands of
the public domain, as claimed in the dissenting opinion, for the simple reason that no public lands are
involved.
It should be noted that respondent corporation purchased the land from the Infiels on October 16, 1962 under
the aegis of the 1935 Constitution which contained no prohibition against corporations holding public lands
(except a limit of 1,024 hectares) unlike the later 1973 Constitution which imposed an absolute prohibition.
Even on the erroneous assumption that the land remained public land despite the Infiels' open possession
thereof as owners from time immemorial, respondent corporation's lawful purchase from them of the land in
1962 and P 45million investments redounding presumably to the welfare and progress of the community,
particularly the municipality of Maconacon, Isabela to which it donated part of the land for the townsite
created a vested right which could not be impaired by the prohibition adopted eleven years later. But as
sufficiently stressed, the land of the Infiels had been ipso jure converted into private land and they had a
legally sufficient and transferable title conferred by the conclusive presumption of the Public Land Act (which
needed only to be established in confirmation of title proceedings for formalization and issuance of the
certificate of title) which they lawfully and validly transferred to respondent corporation.
In fact, the many amendments to the Act extending the period for the filing of such applications for judicial
confirmation of imperfect and incomplete titles to alienable and disposable public lands expressly reiterate
that it has always been the "policy of the State to hasten the settlement, adjudication and quieting of titles to
[such] unregistered lands," i.e. to recognize that such lands publicly and notoriously occupied and cultivated
under bona fide claim of acquisition or ownership have ipso jure been converted into private property and
grant the possessors the opportunity to establish and record such fact. Thus, the deadline for the filing of
such application which would have originally expired first on December 31, 1938 was successively extended
to December 31, 1941, then extended to December 31, 1957, then to December 31, 1968, further extended
to December 31, 1976 and lastly extended to December 31, 1987. 7
The cited Act's provision that only natural persons may apply thereunder for confirmation of title is in effect a
technicality of procedure and not of substance. My submittal in Meralco, mutatis mutandis, is properly
applicable: "The ends of justice would best be served, therefore, by considering the applications for
confirmation as amended to conform to the evidence, i.e. as filed in the names of the original persons who as
natural persons are duly qualified to apply for formal confirmation of the title that they had acquired by
conclusive presumption and mandate of the Public Land Act and who thereafter duly sold to the herein
corporations (both admittedly Filipino corporations duly qualified to hold and own private lands) and granting
the applications for confirmation of title to the private lands so acquired and sold or exchanged." 8 Indeed,
then Chief Justice Enrique M. Fernando likewise dissented along the same line from the majority ruling
therein and held: "I dissent insofar as the opinion of the Court would characterize such jurisdictional defect
that the applicant was Meralco, a juridical person rather than the natural persons-transferors, under the
particular circumstances of this case, as an insurmountable obstacle to the relief sought. I would apply by
analogy, although the facts could be distinguished, the approach followed by us in Francisco v. City of
Davao,where the legal question raised, instead of being deferred and possibly taken up in another case, was
resolved. By legal fiction and in the exercise of our equitable jurisdiction, I feel that the realistic solution would
be to decide the matter as if the application under Section 48(b) were filed by the Piguing spouses, who I
assume suffer from no such disability." 9 Justice Vicente Abad Santos, now retired, while concurring in the
procedural result, likewise, in effect dissented from the therein majority ruling on the question of substance,
and stated his opinion that "the lots which are sought to be registered have ceased to be lands of the public
domain at the time they were acquired by the petitioner corporation. They are already private lands because
of acquisitive prescription by the predecessors of the petitioner and all that is needed is the confirmation of
the title. Accordingly, the constitutional provision that no private corporation or association may hold alienable
lands of the public domain is inapplicable. " 10
To my mind, the reason why the Act limits the filing of such applications to natural citizens who may prove
their undisputed and open possession of public lands for the required statutory thirty-year period, tacking on
their predecessors'-in-interest possession is that only natural persons, to the exclusion of juridical persons
such as corporations, can actually, physically and in reality possess public lands for the required statutory
30-year period. That juridical persons or corporations cannot do so is obvious. But when the natural persons
have fulfilled the required statutory period of possession, the Act confers on them a legally sufficient and
transferable title. It is preferable to follow the letter of the law that they file the applications for confirmation of
their title, although they have lawfully transferred their title to the land. But such procedural failure cannot and
should not defeat the substance of the law, as stressed in the above-cited opinions, that the lands are
already private lands because of acquisitive prescription by the corporation's predecessors and the realistic
solution would be to consider the application for confirmation as filed by the natural persons-transferors, and
in accordance with the evidence, confirm their title to the private lands so converted by operation of law and
lawfully transferred by them to the corporation. The law, after all, recognizes the validity of the transfer and
sale of the private land to the corporation. It should not be necessary to go in a round-about way and have
the corporation reassign its rights to the private land to natural persons-(as I understand), was done after the
decision in the Meralco and Iglesia ni Cristo cases) just for the purpose of complying on paper with the
technicality of having natural persons file the application for confirmation of title to the private land.
MELENCIO-HERRERA, J., dissenting:
Section 48 of the Public Land Act, in part, provides:
SEC. 48. The following described citizens of the Philippines, occupying lands of the public domain or
claiming to own any such lands or an interest therein, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the province where the land is located for
confirmation of their claims and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit:
(b) Those who by themselves or through their predecessors in interest have been in open, continuous,
exclusive, and notorious possession and occupation of agricultural lands of the public domain, under a
bona fide claim of acquisition of ownership, for at least thirty years immediately preceding the filing of
the application for confirmation of title except when prevented by war or force majeure. These shall be
conclusively presumed to have performed are the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this chapter.
Article XIV, Section 11, of the 1973 Constitution, in part, provides:
SEC. 11. .... No private corporation or association may hold alienable lands of the public domain
except by lease not to exceed one thousand hectares in area; nor may any citizen hold such lands by
lease in excess of five hundred hectares ....
It has to be conceded that, literally, statutory law and constitutional provision prevent a corporation from
directly applying to the Courts for the issuance of Original Certificates of Title to lands of the public domain
(Manila Electric Company vs. Castro-Bartolome, 114 SCRA 799; Republic vs. Villanueva, 114 SCRA 875;
Republic vs. Court of Appeals, 119 SCRA 449; Iglesia ni Cristo vs. Hon. Judge, CFI of Nueva Ecija, Br. 1). It
is my opinion that the literalism should be adhered to in this case.
The reasoning of the majority can be restated in simple terms as follows:
(a) The INFIELS can successfully file an application for a certificate of title over the land involved in the case.
(b) After the INFIELS secure a certificate of title, they can sell the land to ACME.
(c) As ACME can eventually own the certificate of title, it should be allowed to directly apply to the Courts for
the Certificate of Title, thus avoiding the circuituous "literal" requirement that the INFIELS should first apply to
the courts for the titles, and afterwards transfer the title to ACME.
The majority opinion, in effect, adopted the following excerpt from a dissent in Manila Electric Company vs.
Castro-Bartolome (114 SCRA 799, 823 [1982]).
To uphold respondent judge's denial of Meralco's application on the technicality that the Public Land
Act allows only citizens of the Philippines who are natural persons to apply for confirmation of their title
would be impractical and would just give rise to multiplicity of court actions. Assuming that there was a
technical error in not having filed the application for registration in the name of the Piguing spouses as
the original owners and vendors,
still it is conceded that there is no prohibition against their sale of the land to the applicant Meralco
and neither is there any prohibition against the application being refiled with retroactive effect in the
name of the original owners and vendors (as such natural persons) with the end result of their
application being granted, because of their indisputable acquisition of ownership by operation of law
and the conclusive presumption therein provided in their favor.
It should not be necessary to go through all the rituals at the great cost of refiling of all such applications in
their names and adding to the overcrowded court dockets when the Court can after all these years dispose of
it here and now." (Paragraphing supplied)
The effect is that the majority opinion now nullifies the statutory provision that only citizens (natural persons)
can apply for certificates of title under Section 48(b) of the Public Land Act, as well as the constitutional
provision (Article XIV, Section 11) which prohibits corporations from acquiring title to lands of the public
domain. That interpretation or construction adopted by the majority cannot be justified. "A construction
adopted should not be such as to nullify, destroy or defeat the intention of the legislature" (New York State
Dept. of Social Services v. Dublino [UST 37 L. Ed 2d 688, 93 S Ct 2507; United States v. Alpers 338 US 680,
94 L Ed 457, 70 S Ct 352; cited in 73 Am Jur. 2nd., p. 351).
It has also been said that: In the construction of statutes, the courts start with the assumption that the
legislature intended to enact an effective law, and the legislature is not to be presumed to have done a vain
thing in the enactment of a statute. Hence, it is a general principle that the courts should, if reasonably
possible to do so interpret the statute, or the provision being construed, so as to give it efficient operation and
effect as a whole. An interpretation should, if possible, be avoided, under which the statute or provision being
construed is defeated, or as otherwise expressed, nullified, destroyed, emasculated, repealed, explained
away, or rendered insignificant, meaningless, inoperative, or nugatory. If a statute is fairly susceptible of two
constructions, one of which will give effect to the act, while the other will defeat it, the former construction is
preferred. One part of a statute may not be construed so as to render another part nugatory or of no effect.
Moreover, notwithstanding the general rule against the enlargement of extension of a statute by construction,
the meaning of a statute may be extended beyond the precise words used in the law, and words or phrases
may be altered or supplied, where this is necessary to prevent a law from becoming a nullity. Wherever the
provision of a statute is general everything which is necessary to make such provision effectual is supplied by
implication. (Pliakos vs. Illinois Liquor Control Com. 11 III 2d 456, 143 NE2d 47; cited in 73 AM Jur. 2d pp.
422-423) The statutory provision and the constitutional prohibition express a public policy. The proper course
for the Court to take is to promote in the fullest manner the policy thus laid down and to avoid a construction
which would alter or defeat that policy.