FIRST DIVISION

HEIRS OF BIENVENIDO AND G.R. No. 175763

ARACELI TANYAG, namely: ARTURO
TANYAG, AIDA T. JOCSON AND ZENAIDA Present:
T. VELOSO,
Petitioners, CORONA, C.J.,
Chairperson,
LEONARDO-DE CASTRO,
- versus - BERSAMIN,
DEL CASTILLO, and
VILLARAMA, JR., JJ.

SALOME E. GABRIEL, NESTOR R.

GABRIEL, LUZ GABRIEL-ARNEDO married Promulgated:
to ARTURO ARNEDO, NORA GABRIEL-
CALINGO married to FELIX CALINGO, April 11, 2012
PILAR M. MENDIOLA, MINERVA GABRIEL-
NATIVIDAD marriedto EUSTAQUIO
NATIVIDAD, and ERLINDA VELASQUEZ
married to HERMINIO VELASQUEZ,
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

VILLARAMA, JR., J.:

This is a petition for review under Rule 45 which seeks to reverse the Decision [1] dated August 18, 2006 and
Resolution[2] dated December 8, 2006 of the Court of Appeals (CA) in CA-G.R. CV No. 81224. The CA
affirmed the Decision[3] dated November 19, 2003 of the Regional Trial Court of Pasig City, Branch 267 in Civil
Case No. 67846 dismissing petitioners complaint for declaration of nullity of Original Certificate of Title (OCT)
No. 1035, reconveyance and damages, as well as respondents counterclaims for damages and attorneys fees.

Subject of controversy are two adjacent parcels of land located at Ruhale, Barangay Calzada, Municipality of
Taguig (now part of Pasig City, Metro Manila). The first parcel (Lot 1) with an area of 686 square meters was
originally declared in the name of Jose Gabriel under Tax Declaration (TD) Nos. 1603 and 6425 issued for the
years 1949 and 1966, while the second parcel (Lot 2) consisting of 147 square meters was originally declared in
the name of Agueda Dinguinbayan under TD Nos. 6418 and 9676 issued for the years 1966 and 1967. [4] For
several years, these lands lined with bamboo plants remained undeveloped and uninhabited.

Petitioners claimed that Lot 1 was owned by Benita Gabriel, sister of Jose Gabriel, as part of her inheritance as
declared by her in a 1944 notarized instrument (Affidavit of Sale) whereby she sold the said property to spouses
Gabriel Sulit and Cornelia Sanga. Said document states:

DAPAT MALAMAN NG LAHAT NG MAKABABASA

Na, akong Benita Gabriel, balo sa nasirang Calixto Lontoc, Filipina may karapatang gulang
naninirahan sa nayon ng Palingon, Tagig, Rizal, x x x sa pamamaguitan nitoy

ISINASAYSAY KO AT PINAGTITIBAY
1
 1.) Na, sarili ko at tunay na pagaari ang isang lagay na lupang kawayanan na sapagkat itoy
kabahagui ko sa aking kapatid na [J]ose Gabriel, na itoy mana ko sa aking nasirang ama Mateo
Gabriel sa kami lamang dalawa ng aking kapatid na binabanguit ko na Jose Gabriel siyang mga
anak at tagapagmana ng aming amang nasirang Mateo Gabriel, maliban sa amin ay wala nang
iba, kayat kami ay naghati sa mga ari-arian na na iwan sa amin ng nasirang ama namin na Mateo
Gabriel, na ang lupang kawayanang itoy may nakatanim na walong (8) punong kawayan at na sa
pook na kung pamagatan ay Ruhale nayon ng Calzada, Tagig, Rizal, at na sa loob ng mga
kahanganan at sukat na sumusunod[:]

Na, ang kahangan sa Hilagaan Sapang Ruhale at Vicente Bunye, sa Amihanan Felipe
Pagkalinawan, sa Timugan Juan Flores, at sa Habagatan Apolonio Ocol may sukat na 6 areas at
85 centiareas may halagan amillarada na P80.00) Pesos alinsunod sa Tax Blg. 20037, sa pangalan
ng aking kapatid na Jose Gabriel. Na, ang lupang itoy hindi natatala sa bisa ng batas Blg. 496 ni
sa susog gayon din sa Hipotecaria Espaola itoy may mga mojon bato ang mga panulok at
walang bakod.

2.) Na, alang-alang sa halagang SIYAMNAPO AT ANIM (P96.00) na Pisong salaping

guinagamit dito sa Filipinas na bago dumating ang mga sandaling itoy tinaggap ko at ibinayad sa
akin ng boong kasiyahang loob ko ng magasawang GABRIEL SULIT AT CORNELIA SANGA,
mga Filipinos may mga karapatang gulang mga naninirahan sa nayon ng Calzada, Tagig, Rizal,
ngayon ay inilipat ko at ipinagbili ng bilihang tuluyan (Venta real soluta) ang isinasaysay kong
lupang kawayanan sa itaas nito ng nasabi halagang SIYAMNAPO AT ANIM (P96.00) na Piso at
sa nabanguit na magasawang GABRIEL SULIT AT CORNELIA SANGA, gayon din sa lahat ng
mga tagapagmana nila, ngayong mga arao na ito ay ang may hawak at namamahala ng lupang
itoy ang mga nakabili sa akin na magasawang GABRIEL SULIT AT CORNELIA SANGA.

3.) Na, ang kasulatang itoy ng bilihan ay nais na itala sa bisa ng batas Blg. 3344.

NA SA KATUNAYAN NG LAHAT NG ITOY ako ay lumagda sa kasulatang ito dito sa

Tagig, Rizal, ngayong ika - 28 ng Junio 1944.

(Nilagdaan) BENITA GABRIEL[5]

Lot 1 allegedly came into the possession of Benita Gabriels own daughter, Florencia Gabriel Sulit, when her
father-in-law Gabriel Sulit gave it to her as part of inheritance of his son, Eliseo Sulit who was Florencias
husband. Florencia Sulit sold the same lot to Bienvenido S. Tanyag, father of petitioners, as evidenced by a
notarized deed of sale dated October 14, 1964.[6] Petitioners then took possession of the property, paid the real
estate taxes due on the land and declared the same for tax purposes, as shown by TD No. 11445 issued in 1969
in the name of Bienvenidos wife, Araceli C. Tanyag; TD No. 11445 cancelled TD No. 6425 in the name of Jose
Gabriel. TD Nos. 3380 and 00486 also in the name of Araceli Tanyag were issued in the years 1974 and 1979.[7]

As to Lot 2, petitioners averred that it was sold by Agueda Dinguinbayan to Araceli Tanyag under Deed
of Sale executed on October 22, 1968. Thereupon, petitioners took possession of said property and declared the
same for tax purposes as shown by TD Nos. 11361, 3395, 120-014-00482, 120-00-014-20-002-000, C-014-
00180 and D-014-00182 issued for the years 1969, 1974, 1979, 1985, 1991 and 1994. [8]Petitioners claimed to
have continuously, publicly, notoriously and adversely occupied both Lots 1 and 2 through their caretaker Juana
Quinones[9]; they fenced the premises and introduced improvements on the land.[10]

Sometime in 1979, Jose Gabriel, father of respondents, secured TD No. 120-014-01013 in his name over
Lot 1 indicating therein an increased area of 1,763 square meters. Said tax declaration supposedly cancelled TD
No. 6425 over Lot 1 and contained the following inscription[11]:
2
 Note: Portions of this Property is Also Declared
in the name of Araceli C. Tanyag under
T.D.#120-014-00858 686 sq. m.

Also inscribed on TD No. 120-014-00858[12] (1979) in the name of Araceli Tanyag covering Lot 1 are
the following:

This property is also covered by T.D. #120-014-01013

in the name of Jose P. Gabriel
1-8-80

which notation was carried into the 1985, 1990 and 1991 tax declarations, all in the name of Araceli Tanyag.

On March 20, 2000, petitioners instituted Civil Case No. 67846 alleging that respondents never occupied the
whole 686 square meters of Lot 1 and fraudulently caused the inclusion of Lot 2 in TD No. 120-014-01013 such
that Lot 1 consisting of 686 square meters originally declared in the name of Jose Gabriel was increased to
1,763 square meters. They contended that the issuance of OCT No. 1035 on October 28, 1998 over the subject
land in the name of respondents heirs of Jose Gabriel was null and void from the beginning.[13]

On the other hand, respondents asserted that petitioners have no cause of action against them for they
have not established their ownership over the subject property covered by a Torrens title in respondents
name. They further argued that OCT No. 1035 had become unassailable one year after its issuance and
petitioners failed to establish that it was irregularly or unlawfully procured.[14]

Respondents evidence showed that the subject land was among those properties included in the
Extrajudicial Settlement of Estate of Jose P. Gabriel [15] executed on October 5, 1988, covered by TD No. B-014-
00643 (1985) in the name of Jose Gabriel. Respondents declared the property in their name but the tax
declarations (1989, 1991 and 1994) carried the notation that portions thereof (686 sq. ms.) are also declared in
the name of Araceli Tanyag. On October 28, 1998, OCT No. 1035[16] was issued to respondents by the Register
of Deeds of Pasig, Metro Manila under Decree No. N-219177 pursuant to the Decision dated September 20,
1996 of the Land Registration Court in LRC Case No. N-11260, covering Lot 1836 MCadm-590-D, Taguig
Cadastral Mapping, Plan Ap-04-002253, with an area of 1,560 square meters.

On the other hand, respondents TD Nos. D-014-00839 and D-014-01923 issued in 1993 and 1999
respectively, showed that respondents sold 468 square meters of Lot 1 to Jayson Sta. Barbara. [17] The
segregation of said 468 square meters pertaining to Jayson Sta. Barbara was reflected in the approved survey
plan of Lot 1836 prepared by respondents surveyor on March 18, 2000.[18]

At the trial, petitioners presented their witness Arturo Tanyag, son of Bienvenido Tanyag and Araceli
Tanyag who died on March 30, 1968 and October 30, 1993, respectively. He testified that according to
Florencia Sulit, Benita Gabriel-Lontoc and her family were the ones in possession of Lot 1 since 1944; Benita
Gabriel had executed an Affidavit of Sale declaring said property as her inheritance and conveying the same to
spouses Gabriel and Cornelia Sulit. He affirmed that they had been in possession of Lot 1 from the time
Bienvenido Tanyag bought the land from Florencia Sulit in 1964. Based on the boundaries indicated in the tax
declaration, they fenced the property, installed Juana Quinones as their caretaker who also attended to the
piggery, put up an artesian well and planted some trees. From 1964 up to 1978, nobody disturbed them in their
possession or claimed ownership of the land; four years after acquiring Lot 1, they also purchased the adjacent
property (Lot 2) to expand their piggery. Lot 2 was also separately declared for tax purposes after their mother
purchased it from Agueda Dinguinbayan. He had personally witnessed the execution of the 1968 deed of sale
3
including its notarization, and was also present during the physical turn over of Lot 2 by the seller. In fact, he
was one of the instrumental witnesses to the deed of sale and identified his signature therein. He further
described the place as inaccessible at that time as there were no roads yet and they had to traverse muddy tracks
to reach their property.[19]

Arturo further testified that the first time they met Jose Gabriel was when the latter borrowed from their
mother all the documents pertaining to their property. Jose Gabriel came looking for a piece of property which
he claims as his but he had no documents to prove it and so they showed him their documents pertaining to the
subject property; out of the goodness of her mothers heart, she lent those documents to her brother Jose
Gabriel. During the cadastral survey conducted in 1976, they had both lots surveyed in preparation for their
consolidation under one tax declaration. However, they did not succeed in registering the consolidated lots as
they discovered that there was another tax declaration covering the same properties and these were applied for
titling under the name of Jose Gabriel sometime in 1978 or 1980, which was after the time said Jose Gabriel
borrowed the documents from their mother. No notice of the hearings for application of title filed by Jose
Gabriel was received by them. They never abandoned the property and their caretaker never left the place
except to report to the police when she was being harassed by the respondents. He also recalled that respondents
had filed a complaint against them before the barangay but since no agreement was reached after several
meetings, they filed the present case.[20]

The next witness for petitioners was Juana Quinones, their caretaker who testified that she had been
staying on petitioners property since 1964 or for 35 years already. She had built a nipa hut and artesian well,
raised piggery and poultry and planted some root crops and vegetables on the land. At first there was only one
parcel but later the petitioners bought an additional lot; Arturo Tanyag gave her money which she used for the
fencing of the property. During all the time she occupied the property there was nobody else claiming it and she
also had not received any notice for petitioners concerning the property, nor the conduct of survey on the
land. On cross-examination, she admitted that she was living alone and had no Voters ID or any document
evidencing that she had been a resident there since 1964. Although she was living alone, she asks for help from
other persons in tending her piggery.[21]

Angelita Sulit-delos Santos, cousin of petitioners and also of respondents, testified that she came to
know the subject property because according to her paternal grandfather Gabriel Sta. Ana Sulit, her maternal
grandmother Benita Gabriel-Lontoc mortgaged the property to him.It was Benita Gabriel Lontoc who took care
of her, her siblings and cousins; they lived with her until her death. She identified the signature of Benita
Gabriel in the 1944 Affidavit of Sale in favor of Gabriel Sulit. Lot 1 consisting of 600 square meters was vacant
property at that time but her family was in possession thereof when it was sold to Gabriel Sulit; it was her father
Eliseo Sulit and uncle Hilario Sulit, who were incharge of their property. On cross-examination, she was asked
details regarding the supposed mortgage of Lot 1 to Gabriel Sulit but she admitted she does not know anything
as she was still very young then.[22]

Respondents first witness was Roberto Gabriel Arnedo, son of Luz Gabriel-Arnedo. He testified that
when he was about 5 or 6 years old (1953 or 1954), his grandfather Jose Gabriel used to bring him along to visit
the subject property consisting of 1,763 square meters based on the tax declaration and OCT. They had picnics
and celebrate his grandfathers birthday there. He recalled accompanying his grandfather in overseeing the
planting of gumamela which served as the perimeter fence. Jose Gabriel had not mentioned anything about the
claim of petitioners over the same land; Jose Gabriel handed the documents pertaining to the land to his eldest
aunt and hence it now belongs to them.[23] On cross-examination, he claimed that during those years he had
visited the land together with his grandfather, he did not see Florencia Sulit and her family.[24]

4
 Virginia Villanueva, daughter of Salome Gabriel, testified that they acquired the subject property from
their grandfather Jose Gabriel who had a tax declaration in his name. Her mother furnished them with
documents such as tax declarations and the extrajudicial settlement of the estate of Jose Gabriel; they also have
an approved survey plan prepared for Salome Gabriel. She does not know the petitioners in this case.[25] On
cross-examination, she said that the subject property was inherited by Jose Gabriel from his father Mateo
Gabriel; Jose Gabriel was the sole owner of the land while Benita Gabriel has separate properties in Palingon
and Langkokak.[26] Though they are not actually occupying the property, they visit the place and she does not
know anybody occupying it, except for the portion (486 square meters) which petitioners sold to Sta. Barbara. A
nine-door apartment was built on the said portion without their permission. She had talked to both Sta. Barbara
and with Arturo Tanyag they had meetings before the barangay; however, petitioners filed the present case in
court. She insisted that there is nobody residing in the subject property; there is still the remaining 901 square
meters which is owned by their mother. She admitted there were plants on the land but she does not know who
actually planted them; it was her grandfather who built a wooden fence and gumamela in the 1960s. As to the
hearings on the application for title, she had not attended the same; she does not know whether the petitioners
were notified of the said hearings. She also caused the preparation of the survey plan for Salome Gabriel. On
the increased area of the property indicated in the later tax declarations, she admitted the discrepancy but said
there were barangay roads being built at the time.[27]

Esmeraldo Ramos, Municipal Assessor of Taguig, testified that he was formerly a Land Appraiser in the
Office of the Municipal Assessor of Taguig and in the course of his duties had certified one of the tax
declarations in the name of respondents (TD No. EL-014-10585). He identified and verified said document and
the other tax declarations submitted in court by the respondents. He admitted that on January 10, 1980, they
made the entry on TD No. 6425 in the name of Jose Gabriel that the same was cancelled by TD No. 120-014-
01013 also in the name of Jose Gabriel who presented a supposed deed of sale in favor of Araceli Tanyag which
caused the earlier cancellation of TD No. 6425 in his name. However, upon investigation they found out that the
seller Florencia Sulit was not the owner because the declared owner was Jose Gabriel; even the deed of sale
recognized that the property was declared in the name of Jose Gabriel. They also discovered from the cadastral
survey and tax mapping of Taguig that the property is in the name of Jose Gabriel both in the Bureau of Lands
and Municipal Assessors Office. As far as he knows, it was Jose Gabriel who owned the subject property which
he usually visited; he recalled that around the late 70s and 80s, he ordered the fencing of barbed wire and
bamboo stalks on the land which is just 3 lots away from his own property. As to the discrepancy in the area of
the property as originally declared by Jose Gabriel, he explained that the boundaries in the original tax
declaration do not change but after the land is surveyed, the boundaries naturally would be different because the
previous owner may have sold his property or the present owner inherits the property from his parents. He
admitted that the tax declaration is just for tax purposes and not necessarily proof of ownership or possession of
the property it covers.[28]

Respondents last witness was Antonio Argel who testified that he had resided for 52 years on a land near
the subject property and as far as he knows it was Jose Gabriel who owns it and planted thereon. On cross-
examination, he admitted that Jose Gabriel was not in physical possession of the property. He just assumed that
the present occupants of the property were allowed by Jose Gabriel to stay therein because he is the
owner. There is an apartment and three small houses existing on the property, and about five families are living
there. He confirmed that there is a piggery being maintained by a certain Juana who had been residing there
maybe for fifteen years already.[29]

In rebuttal, petitioners presented two witnesses who are owners of properties adjoining that of the
subject land. Rodante Domingo testified that it was only now did he learn that the property of Arturo Tanyag is
already titled in the name of respondents. He was not aware of the titling proceeding because he never received
any notice as adjoining owner. His own property is already titled in his name and he even asked Arturo Tanyag

5
to act as a witness in his application for titling. [30] On the other hand, Dado Dollado testified that he acquired his
property in 1979. He likewise affirmed that he did not receive any notice of the proceedings for application for
titling filed by respondents and it was only now that he learned from Arturo Tanyag that the subject property
was already titled in the names of respondents.[31]

The last rebuttal witness for petitioners was Dominador Dinguinbayan Ergueza, son of Agueda
Dinguinbayan. He testified that the subject property was formerly owned by his mother and the present owner is
Araceli Tanyag who bought the same from his mother in 1968.He described the boundaries of the property in
relation to the adjoining owners at that time; presently, the left portion is already a street (Rujale St.) going
towards the sea. He admitted that his wife, Livina Ergueza was an instrumental witness in the 1968 deed of sale
in favor of Araceli Tanyag.[32]

In its decision, the trial court dismissed the complaint as well as the counterclaim, holding that
petitioners failed to establish ownership of the subject property and finding the respondents to be the declared
owners and legal possessors. It likewise ruled that petitioners were unable to prove by preponderance of
evidence that respondents acquired title over the property through fraud and deceit.

Petitioners appealed to the CA which affirmed the trial courts ruling. The CA found that apart from the
Affidavit executed by Benita Gabriel in 1944 claiming that she inherited Lot 1 from their father, Mateo Gabriel,
there is no evidence that she, not Jose Gabriel, was the true owner thereof. It noted that just four years after
Benita Gabriels sale of the subject property to the Sulit spouses, Jose Gabriel declared the same under his name
for tax purposes, paying the corresponding taxes. The appellate court stressed that petitioners allegation of bad
faith was not proven.

Petitioners motion for reconsideration was likewise denied by the CA. Hence, this petition.

Petitioners assail the CA in not finding that the respondents obtained OCT No. 1035 in their names
fraudulently and in bad faith. They also claim to have acquired ownership of the subject lots by virtue of
acquisitive prescription.

The issues presented are: (1) whether respondents committed fraud and bad faith in registering the
subject lots in their name; and (2) whether petitioners acquired the property through acquisitive prescription.

Registration of a piece of land under the Torrens System does not create or vest title, because it is not a
mode of acquiring ownership. A certificate of title is merely an evidence of ownership or title over the particular
property described therein.[33] Thus, notwithstanding the indefeasibility of the Torrens title, the registered owner
may still be compelled to reconvey the registered property to its true owners. The rationale for the rule is that
reconveyance does not set aside or re-subject to review the findings of fact of the Bureau of Lands. In an action
for reconveyance, the decree of registration is respected as incontrovertible. What is sought instead is the
transfer of the property or its title which has been wrongfully or erroneously registered in another persons name,
to its rightful or legal owner, or to the one with a better right.[34]

An action for annulment of title or reconveyance based on fraud is imprescriptible where the plaintiff is
in possession of the property subject of the acts. [35] The totality of the evidence on record established that it was
petitioners who are in actual possession of the subject property; respondents merely insinuated at occasional
visits to the land. However, for an action for reconveyance based on fraud to prosper, this Court has held that the
party seeking reconveyance must prove by clear and convincing evidence his title to the property and the fact of
fraud.[36]

6
 The CA correctly observed that the only evidence of Benita Gabriels supposed title was the 1944 Affidavit
of Sale whereby Benita Gabriel claimed sole ownership of Lot 1 as her inheritance from their father, Mateo
Gabriel. The property until 1949 was still declared in the name Jose Gabriel despite the 1944 sale executed by
Benita Gabriel in favor of spouses Gabriel and Cornelia Sulit. As to the alleged fraud perpetrated by Jose Gabriel
and respondents in securing OCT No. 1035 in their name, this was clearly not proven as Arturo Tanyag testified
merely that Jose Gabriel borrowed their documents pertaining to the property. No document or testimony was
presented to show that Jose Gabriel employed deceit or committed fraudulent acts in the proceedings for titling of
the property.

However, the CA did not address the issue of acquisitive prescription raised by the petitioners. In their
Complaint before the lower court, petitioners alleged

15. Defendants never occupied the whole area of the lot covered by Tax Declaration No.
1603 (686 sq. m.) neither were they able to set foot on the property covered by Tax Declaration
No. 6542 [sic] for the reason that those lots had been in actual, open continuous, adverse and
notorious possession of the plaintiffs against the whole world for more than thirty years which is
equivalent to title.

x x x x[37]

Such character and length of possession of a party over a parcel of land subject of controversy is a factual
issue. Settled is the rule that questions of fact are not reviewable in petitions for review on certiorari under Rule
45 of the Rules of Court, as only questions of law shall be raised in such petitions. While this Court is not a trier
of facts, if the inference drawn by the appellate court from the facts is manifestly mistaken, it may, in the
interest of justice, review the evidence in order to arrive at the correct factual conclusions based on the record.
[38]

In this case, the CA was mistaken in concluding that petitioners have not acquired any right over the subject
property simply because they failed to establish Benita Gabriels title over said property. The appellate court
ignored petitioners evidence of possession that complies with the legal requirements of acquiring ownership by
prescription.

Acquisitive prescription is a mode of acquiring ownership by a possessor through the requisite lapse of
time. In order to ripen into ownership, possession must be in the concept of an owner, public, peaceful and
uninterrupted.[39] Possession is open when it is patent, visible, apparent, notorious and not clandestine. [40] It is
continuous when uninterrupted, unbroken and not intermittent or occasional; exclusive when the adverse
possessor can show exclusive dominion over the land and an appropriation of it to his own use and benefit; and
notorious when it is so conspicuous that it is generally known and talked of by the public or the people in the
neighborhood. The party who asserts ownership by adverse possession must prove the presence of the essential
elements of acquisitive prescription.[41]

On the matter of prescription, the Civil Code provides:

Art. 1117. Acquisitive prescription of dominion and other real rights may be ordinary or
extraordinary.

Ordinary acquisitive prescription requires possession of things in good faith and with just
title for the time fixed by law.

Art. 1134. Ownership and other real rights over immovable property are acquired by
ordinary prescription through possession of ten years.
7
 Art. 1137. Ownership and other real rights over immovables also prescribe through
uninterrupted adverse possession thereof for thirty years, without need of title or of good
faith. (Emphasis supplied.)

Petitioners adverse possession is reckoned from 1969 with the issuance of TD No. 1145 in the name of
Araceli Tanyag, which tax declaration cancelled TD No. 6425 in the name of Jose Gabriel.[42] It is settled that
tax receipts and declarations are prima facie proofs of ownership or possession of the property for which such
taxes have been paid. Coupled with proof of actual possession of the property, they may become the basis of a
claim for ownership.[43] Petitioners caretaker, Juana Quinones, has since lived in a nipa hut, planted vegetables
and tended a piggery on the land. Aside from paying taxes due on the property, petitioners also exercised other
acts of ownership such as selling the 468-square meter portion to Sta. Barbara who had constructed thereon a
nine-door apartment building.

It was only in 1979 that respondents began to assert a claim over the property by securing a tax declaration in
the name of Jose Gabriel albeit over a bigger area than that originally declared. In 1998, they finally obtained an
original certificate of title covering the entire 1,763 square meters which included Lot 1. Did these acts of
respondents effectively interrupt the possession of petitioners for purposes of prescription?

We answer in the negative.

In the case of Heirs of Marcelina Azardon-Crisologo v. Raon[44] this Court citing Article 1123 of the Civil
Code[45] held that civil interruption takes place with the service of judicial summons to the possessor and not by
filing of a mere Notice of Adverse Claim. Thus:

Article 1123 of the Civil Code is categorical. Civil interruption is produced by judicial
summons to the possessor. Moreover, even with the presence of judicial summons, Article 1124
sets limitations as to when such summons shall not be deemed to have been issued and shall not
give rise to interruption, to wit: 1) if it should be void for lack of legal solemnities; 2) if the
plaintiff should desist from the complaint or should allow the proceedings to lapse; or 3) if the
possessor should be absolved from the complaint.

Both Article 1123 and Article 1124 of the Civil Code underscore the judicial character of
civil interruption. For civil interruption to take place, the possessor must have received
judicial summons. None appears in the case at bar. The Notice of Adverse Claim which was
filed by petitioners in 1977 is nothing more than a notice of claim which did not effectively
interrupt respondents possession. Such a notice could not have produced civil interruption. We
agree in the conclusion of the RTC, which was affirmed by the Court of Appeals, that the
execution of the Notice of Adverse Claim in 1977 did not toll or interrupt the running of the
prescriptive period because there remains, as yet, a necessity for a judicial determination of its
judicial validity. What existed was merely a notice. There was no compliance with Article 1123
of the Civil Code. What is striking is that no action was, in fact, filed by petitioners against
respondents. As a consequence, no judicial summons was received by respondents. As aptly
held by the Court of Appeals in its affirmance of the RTCs ruling, the Notice of Adverse Claim
cannot take the place of judicial summons which produces the civil interruption provided for
under the law. In the instant case, petitioners were not able to interrupt respondents adverse
possession since 1962. The period of acquisitive prescription from 1962 continued to run in
respondents favor despite the Notice of Adverse Claim.(Emphasis supplied.)

From 1969 until the filing of this complaint by the petitioners in March 2000, the latter have been in
continuous, public and adverse possession of the subject land for 31 years. Having possessed the property for
8
the period and in the character required by law as sufficient for extraordinary acquisitive prescription,
petitioners have indeed acquired ownership over the subject property. Such right cannot be defeated by
respondents acts of declaring again the property for tax purposes in 1979 and obtaining a Torrens certificate of
title in their name in 1998.

This notwithstanding, we uphold petitioners right as owner only with respect to Lot 1 consisting of 686
square meters. Petitioners failed to substantiate their claim over Lot 2 by virtue of a deed of sale from the
original declared owner, Agueda Dinguinbayan. Respondents asserted that the 147 square meters covered by the
tax declarations of Dinguinbayan being claimed by petitioners is not the same lot included in OCT No. 1035.

Under Article 434 of the Civil Code, to successfully maintain an action to recover the ownership of a real
property, the person who claims a better right to it must prove two (2) things: first, the identity of the land claimed;
and second, his title thereto. In regard to the first requisite, in an accion reinvindicatoria, the person who claims
that he has a better right to the property must first fix the identity of the land he is claiming by describing the
location, area and boundaries thereof.[46] In this case, petitioners failed to identify Lot 2 by providing evidence of
the metes and bounds thereof, so that the same may be compared with the technical description contained in OCT
No. 1035, which would have shown whether Lot 2 consisting of 147 square meters was erroneously included in
respondents title. The testimony of Agueda Dinguinbayans son would not suffice because said witness merely
stated the boundary owners as indicated in the 1966 and 1967 tax declarations of his mother. On his part, Arturo
Tayag claimed that he had the lots surveyed in the 1970s in preparation for the consolidation of the two
parcels. However, no such plan was presented in court.

WHEREFORE, the petition is PARTLY GRANTED. The Decision dated August 18, 2006 of the
Court of Appeals in CA-G.R. CV No. 81224 is MODIFIED in that petitioners heirs of Bienvenido and Araceli
Tanyag are hereby declared the owners of 686 square meters previously declared under Tax Declaration Nos.
11445, 120-014-00486, 120-014-0085, B-014-00501, E-014-01446, C-014-00893 and D-014-00839 all in the
name of Araceli Tanyag, which lot is presently covered by OCT No. 1035 issued by the Register of Deeds of
Pasig, Metro Manila in the name of respondents Salome Gabriel, Nestor R. Gabriel, Luz Gabriel-Arnedo, Nora
Gabriel-Calingo, Pilar Gabriel-Mendiola, Minerva Gabriel-Natividad and Erlinda Gabriel-
Velasquez. Respondents are ORDERED to RECONVEY the said 686-square meter portion to the petitioners.

No pronouncement as to costs.

SO ORDERED.

9
 THIRD DIVISION

CITY OF MANILA, G.R. No. 169263

Petitioner, Present:

VELASCO, JR., J., Chairperson,

PERALTA,
ABAD,
- versus- MENDOZA, and
PERLAS-BERNABE, JJ.
Promulgated:

September 21, 2011

MELBA TAN TE,
Respondent.
x---------------------------------------------------------------------------------------x

DECISION

PERALTA, J.:

In this Petition for Review,[1] the City of Manila assails the April 29, 2005 Decision[2] of the Court of
Appeals in CA-G.R. CV No. 71894, as well as the August 12, 2005 Resolution, [3] in the said case denying
reconsideration.
The assailed decision affirmed the June 13, 2001 Order[4] of the Regional Trial Court of Manila, Branch 24
issued in Civil Case No. 00-99264 one for expropriation filed by petitioner, the City of Manila. The said Order,
in turn, granted the motion to dismiss the complaint that was filed by respondent Melba Tan Te, in lieu of an
answer.

The facts follow.

On March 15, 1998, then Manila City Mayor Joselito L. Atienza approved Ordinance No. 7951 an expropriation
measure enacted on February 3, 1998 by the city council authorizing him to acquire by negotiation or
expropriation certain pieces of real property along Maria Clara and Governor Forbes Streets where low-cost
housing units could be built and then awarded to bona fide residents therein. For this purpose, the mayor was
also empowered to access the citys funds or utilize funding facilities of other government agencies. [5] In the
aggregate, the covered property measures 1,425 square meters, and includes the 475-square-meter lot owned by
respondent Melba Tan Te.[6]

The records bear that respondent had acquired the property from the heirs of Emerlinda Dimayuga Reyes in
1996, and back then it was being occupied by a number of families whose leasehold rights had long expired
even prior to said sale. In 1998, respondent had sought before the Metropolitan Trial Court of Manila, Branch
15 the ejectment of these occupants from the premises. The favorable ruling in that case evaded execution;
hence, the court, despite opposition of the City of Manila, issued a Writ of Demolition at respondents instance.
[7]
It appears that in the interim between the issuance of the writ of execution and the order of demolition, the
City of Manila had instituted an expropriation case[8] affecting the same property. Respondent had moved for the
dismissal of that first expropriation case for lack of cause of action, lack of showing of an ordinance authorizing
10
the expropriation, and non-compliance with the provisions of Republic Act (R.A.) No. 7279, otherwise known
as the Urban Development and Housing Act of 1992.[9] The trial court found merit in the motion and dismissed
the complaint without prejudice.[10]

On November 16, 2000, petitioner[11] filed this second Complaint[12] for expropriation before the Regional Trial
Court of Manila, Branch 24.[13] This time, it attached a copy of Ordinance No. 7951 and alleged that pursuant
thereto, it had previously offered to purchase the subject property from respondent for P824,330.00.[14] The offer
was contained in a letter sent to respondent by the City Legal Officer on May 21, 1999, [15] but respondent
allegedly failed to retrieve it despite repeated notices, [16] thereby compelling petitioner to institute the present
expropriation proceedings after depositing in trust with the Land Bank of the Philippines P1,000,000.00 cash,
representing the just compensation required by law to be paid to respondent.[17]

Respondent did not file an answer and in lieu of that, she submitted a Motion to Dismiss [18] and raised
the following grounds: that Ordinance No. 7951 was an invalid expropriation measure because it violated the
rule against taking private property without just compensation; that petitioner did not comply with the
requirements of Sections 9[19] and 10[20] of R.A. No. 7279; and that she qualified as a small property owner and,
hence, exempt from the operation of R.A. No. 7279, the subject lot being the only piece of realty that she
owned.

Petitioner moved that it be allowed to enter the property, but before it could be resolved, the trial court
issued its June 13, 2001 Order[21] dismissing the complaint. First, the trial court held that while petitioner had
deposited with the bank the alleged P1M cash in trust for respondent, petitioner nevertheless did not submit any
certification from the City Treasurers Office of the amount needed to justly compensate respondent for her
property. Second, it emphasized that the provisions of Sections 9 and 10 of R.A. No. 7279 are mandatory in
character, yet petitioner had failed to show that it exacted compliance with them prior to the commencement of
this suit. Lastly, it conceded that respondent had no other real property except the subject lot which, considering
its total area, should well be considered a small property exempted by law from expropriation. In view of the
dismissal of the complaint, petitioners motion to enter was rendered moot and academic.[22]

Petitioner interposed an appeal to the Court of Appeals which, finding no merit therein, dismissed the
same. Petitioner sought reconsideration,[24] but it was denied.[25]
[23]

In this Petition,[26] petitioner posits that the trial courts dismissal of its complaint was premature, and it
faults the Court of Appeals for having failed to note that by such dismissal it has been denied an opportunity to
show previous compliance with the requirements of Sections 9 and 10 of R.A. No. 7279 as well as to establish
that respondent actually owns other realty apart from the subject property. Besides, continues petitioner,
whether or not it had truly complied with the requirements of the law is a matter which can be determined only
after a trial of the case on the merits and not, as what happened in this case, at the hearing of the motion to
dismiss.[27]

Respondent, for her part, points out that Ordinance No. 7951 is an invalid expropriation measure as it
does not even contain an appropriation of funds in its implementation. In this respect, respondent believes that
the P1M cash deposit certified by the bank seems to be incredible, since petitioner has not shown any
certification from the City Treasurers Office on the amount necessary to implement the expropriation measure.
More importantly, she believes that the dismissal of the complaint must be sustained as it does not allege

11
previous compliance with Sections 9 and 10 of R.A. No. 7279 and, hence, it does not present a valid cause of
action.[28] She theorizes that the expropriation for socialized housing must abide by the priorities in land
acquisition and the available modes of land acquisition laid out in the law, and that expropriation of privately-
owned lands avails only as the last resort.[29] She also invokes the exemptions provided in the law.She professes
herself to be a small property owner under Section 3 (q), [30] and claims that the subject property is the only piece
of land she owns where she, as of yet, has not been able to build her own home because it is still detained by
illegal occupants whom she had already successfully battled with in the ejectment court.[31]

In its Reply, petitioner adopts a different and bolder theory. It claims that by virtue of the vesture of
eminent domain powers in it by its charter, it is thereby not bound by the requirements of Sections 9 and 10 of
R.A. No. 7279. It also asserts its right to immediately enter the subject property because not only is its
complaint supposedly sufficient in form and substance but also because it has already deposited P1M cash with
the bank in trust for respondent. It reiterates that the dismissal of its complaint constitutes a denial of due
process because all the issues propounded by respondent, initially in her motion to dismiss and all the way in
the present appeal, must be resolved in a full-blown trial.

Prefatorily, the concept of socialized housing, whereby housing units are distributed and/or sold to qualified
beneficiaries on much easier terms, has already been included in the expanded definition of public use or
purpose in the context of the States exercise of the power of eminent domain. Said the Court in Sumulong v.
Guerrero,[32] citing the earlier case of Heirs of Juancho Ardona v. Reyes:[33]
The public use requirement for a valid exercise of the power of eminent domain is a
flexible and evolving concept influenced by changing conditions.

The taking to be valid must be for public use. There was a time where it was felt that a literal
meaning should be attached to such a requirement. Whatever project is undertaken must be for
the public to enjoy, as in the case of streets or parks. Otherwise, expropriation is not allowable. It
is not anymore. As long as the purpose of the taking is public, then the power of eminent domain
comes into play. x x x The constitution in at least two cases, to remove any doubt, determines
what is public use. One is the expropriation of lands to be divided into small lots for resale at
cost to individuals. The other is in the transfer, through the exercise of this power, of utilities and
other enterprise to the government. It is accurate to state then that at present whatever may be
beneficially employed for the general welfare satisfies the requirement of public use.

The term public use has acquired a more comprehensive coverage. To the literal import of the
term signifying strict use or employment by the public has been added the broader notion
of indirect public benefit or advantage. x x x

The restrictive view of public use may be appropriate for a nation which circumscribes the scope
of government activities and public concerns and which possesses big and correctly located
public lands that obviate the need to take private property for public purposes. Neither
circumstance applies to the Philippines. We have never been a laissez-faire state. And the
necessities which impel the exertion of sovereign power are all too often found in areas of scarce
public land or limited government resources.

Specifically, urban renewal or development and the construction of low-cost housing are
recognized as a public purpose, not only because of the expanded concept of public use but
also because of specific provisions in the Constitution. x x x The 1987 Constitution [provides]:

12
 The State shall promote a just and dynamic social order that will ensure the
prosperity and independence of the nation and free the people from poverty
through policies that provide adequate social services, promote full employment,
a rising standard of living and an improved quality of life for all. (Article II,
Section 9)

The State shall, by law and for the common good, undertake, in cooperation with
the private sector, a continuing program for urban land reform and housing which
will make available at affordable cost decent housing and basic services to
underprivileged and homeless citizens in urban centers and resettlement areas. x
xx In the implementation of such program the State shall respect the rights of
small property owners. (Article XIII, Section 9)

Housing is a basic human need. Shortage in housing is a matter of state concern since it
directly and significantly affects public health, safety, the environment and in sum, the general
welfare. The public character of housing measures does not change because units in housing
projects cannot be occupied by all but only by those who satisfy prescribed qualifications. A
beginning has to be made, for it is not possible to provide housing for all who need it, all at once.

Population growth, the migration to urban areas and the mushrooming of crowded
makeshift dwellings is a worldwide development particularly in developing countries. So basic
and urgent are housing problems that the United Nations General Assembly proclaimed 1987 as
the "International Year of Shelter for the Homeless" "to focus the attention of the international
community on those problems." The General Assembly is seriously concerned that, despite the
efforts of Governments at the national and local levels and of international organizations, the
driving conditions of the majority of the people in slums and squatter areas and rural settlements,
especially in developing countries, continue to deteriorate in both relative and absolute terms."
[G.A. Res. 37/221, Yearbook of the United Nations 1982, Vol. 36, p. 1043-4]

In light of the foregoing, the Court is satisfied that socialized housing falls within the
confines of public use.[34]

Congress passed R.A. No. 7279,[35] to provide a comprehensive and continuing urban development and housing
program as well as access to land and housing by the underprivileged and homeless citizens; uplift the
conditions of the underprivileged and homeless citizens in urban areas by making available decent housing at
affordable cost; optimize the use and productivity of land and urban resources; reduce urban dysfunctions which
affect public health, safety and ecology; and improve the capability of local governments in undertaking urban
development and housing programs and projects, among others.[36] Accordingly, all city and municipal
governments are mandated to inventory all lands and improvements within their respective locality and identify
lands which may be utilized for socialized housing and as resettlement sites for acquisition and disposition to
qualified beneficiaries.[37] Section 10 thereof authorizes local government units to exercise the power of eminent
domain to carry out the objectives of the law, but subject to the conditions stated therein and in Section 9.[38]

It is precisely this aspect of the law which constitutes the core of the present controversy, yet this case presents a
serious procedural facet overlooked by both the trial court and the Court of Appeals which needs foremost
attention ahead of the issues propounded by the parties.

13
 Expropriation is a two-pronged proceeding: first, the determination of the authority of the plaintiff to
exercise the power and the propriety of its exercise in the context of the facts which terminates in an order of
dismissal or an order of condemnation affirming the plaintiff's lawful right to take the property for the public
use or purpose described in the complaint and second, the determination by the court of the just compensation
for the property sought to be expropriated.[39]

Expropriation proceedings are governed by Rule 67 of the Rules of Court. Under the Rules of Court of
1940 and 1964, where the defendant in an expropriation case conceded to the plaintiffs right to expropriate (or
where the trial court affirms the existence of such right), the court-appointed commissioners would then proceed
to determine the just compensation to be paid. [40] Otherwise, where the defendant had objections to and defenses
against the expropriation of his property, he was required to file a single motion to dismiss containing all such
objections and defenses.[41]
This motion to dismiss was not covered by Rule 15 which governed ordinary motions, and was then the
required responsive pleading, taking the place of an answer, where the plaintiffs right to expropriate the
defendants property could be put in issue.[42] Any relevant and material fact could be raised as a defense, such as
that which would tend to show that the exercise of the power to condemn was unauthorized, or that there was
cause for not taking defendants property for the purpose alleged in the petition, or that the purpose for the taking
was not public in character. With that, the hearing of the motion and the presentation of evidence would
follow. The rule is based on fundamental constitutional provisions affecting the exercise of the power of
eminent domain, such as those that seek to protect the individual property owner from the aggressions of the
government.[43] However, the rule, which was derived from the practice of most American states, proved indeed
to be a source of confusion because it likewise permitted the filing of another motion to dismiss, such as that
referred to in Rule 16, where the defendant could raise, in addition, the preliminary objections authorized under
it.[44]

The Supreme Court, in its en banc Resolution in Bar Matter No. 803 dated April 8, 1997, has provided
that the revisions made in the Rules of Court were to take effect on July 1, 1997. Thus, with said amendments,
the present state of Rule 67 dispenses with the filing of an extraordinary motion to dismiss such as that required
before in response to a complaint for expropriation. The present rule requires the filing of an answer as
responsive pleading to the complaint. Section 3 thereof provides:

Sec. 3. Defenses and objections. If a defendant has no objection or defense to the action
or the taking of his property, he may and serve a notice or appearance and a manifestation to that
effect, specifically designating or identifying the property in which he claims to be interested,
within the time stated in the summons. Thereafter, he shall be entitled to notice of all
proceedings affecting the same.

If a defendant has any objection to the filing of or the allegations in the complaint, or any
objection or defense to the taking of his property, he shall serve his answer within the time
stated in the summons. The answer shall specifically designate or identify the property in
which he claims to have an interest, state the nature and extent of the interest claimed, and
adduce all his objections and defenses to the taking of his property. No counterclaim, cross-
claim or third-party complaint shall be alleged or allowed in the answer or any subsequent
pleading.

A defendant waives all defenses and objections not so alleged but the court, in the interest of
justice, may permit amendments to the answer to be made not later than ten (10) days from the
filing thereof. However, at the trial of the issue of just compensation, whether or not a defendant
14
 has previously appeared or answered, he may present evidence as to the amount of the
compensation to be paid for his property, and he may share in the distribution of the award.[45]

The defendant in an expropriation case who has objections to the taking of his property is now required
to file an answer and in it raise all his available defenses against the allegations in the complaint for eminent
domain. While the answer is bound by the omnibus motion rule under Section 8, [46] Rule 15, much leeway is
nevertheless afforded to the defendant because amendments may be made in the answer within 10 days from its
filing. Also, failure to file the answer does not produce all the disastrous consequences of default in ordinary
civil actions, because the defendant may still present evidence on just compensation.[47]

At the inception of the case at bar with the filing of the complaint on November 16, 2000, the amended
provisions of Rule 67 have already been long in force. Borre v. Court of Appeals[48] teaches that statutes which
regulate procedure in the courts apply to actions pending and undetermined at the time those statutes were
passed. And in Laguio v. Gamet,[49] it is said that new court rules apply to proceedings which take place after the
date of their effectivity.

In the case of Robern Development Corporation v. Quitain,[50] a similar motion to dismiss was filed by
the private property owner, petitioner therein, in an expropriation case filed by the National Power Corporation
(NPC), alleging certain jurisdictional defects as well as issues on the impropriety of the expropriation measure
being imposed on the property. The trial court in that case denied the motion inasmuch as the issues raised
therein should be dealt with during the trial proper. On petition for certiorari, the Court of Appeals affirmed the
trial courts denial of the motion to dismiss. On appeal, the Supreme Court affirmed the Court of Appeals, but
declared that under the amended provisions of Section 3, Rule 67, which were already in force at about the time
the motion to dismiss had been submitted for resolution, all objections and defenses that could be availed of to
defeat the expropriators exercise of the power of eminent domain must be contained in an answer and not in a
motion to dismiss because these matters require the presentation of evidence. Accordingly, while the Court in
that case sustained the setting aside of the motion to dismiss, it nevertheless characterized the order of dismissal
as a nullity. Hence, it referred the case back to the trial court and required the NPC to submit its answer to the
complaint within 10 days from the finality of the decision.

Thus, the trial court in this case should have denied respondents motion to dismiss and required her to
submit in its stead an answer within the reglementary period. This, because whether petitioner has observed the
provisions of Sections 9 and 10 of R.A. No. 7279 before resorting to expropriation, and whether respondent
owns other properties than the one sought to be expropriated, and whether she is actually a small property
owner beyond the reach of petitioners eminent domain powers, are indeed issues in the nature of affirmative
defenses which require the presentation of evidence aliunde.[51] Besides, Section 1, Rule 16 of the Rules of
Court does not consider these matters grounds for a motion to dismiss, and an action can be dismissed only on
the grounds authorized by this provision.[52]

The Court declared in Robern Development Corporation, thus:

Accordingly, Rule 16, Section 1 of the Rules of Court, does not consider as grounds for a
motion to dismiss the allotment of the disputed land for another public purpose or the petition for
a mere easement of right-of-way in the complaint for expropriation. The grounds for dismissal
are exclusive to those specifically mentioned in Section 1, Rule 16 of the Rules of Court, and an
action can be dismissed only on a ground authorized by this provision.
15
 To be exact, the issues raised by the petitioner are affirmative defenses that should be
alleged in an answer, since they require presentation of evidence aliunde. Section 3 of Rule 67
provides that if a defendant has any objection to the filing of or the allegations in the complaint,
or any objection or defense to the taking of his property, he should include them in his answer.
Naturally, these issues will have to be fully ventilated in a full-blown trial and hearing. It would
be precipitate to dismiss the Complaint on such grounds as claimed by the petitioner. Dismissal
of an action upon a motion to dismiss constitutes a denial of due process if, from a consideration
of the pleadings, it appears that there are issues that cannot be decided without a trial of the case
on the merits.

Inasmuch as the 1997 Rules had just taken effect when this case arose, we believe that in the
interest of substantial justice, the petitioner should be given an opportunity to file its answer to
the Complaint for expropriation in accordance with Section 3, Rule 67 of the 1997 Rules of Civil
Procedure.x x x[53]

WHEREFORE, the Petition is hereby GRANTED. The Order of the Regional Trial Court of Manila,
Branch 24 in Civil Case No. 00-99264 dated June 13, 2001, as well as the April 29, 2005 Decision of the Court
of Appeals in CA-G.R. CV No. 71894 affirming said order, and the August 12, 2005 Resolution therein which
denied reconsideration, are hereby SET ASIDE. The case is hereby REMANDED to the trial court for further
proceedings. Respondent is DIRECTED to file her Answer to the complaint within ten (10) days from the
finality of this Decision.

SO ORDERED.

16
 SECOND DIVISION

[G.R. No. 158563. June 30, 2005]

AIR TRANSPORTATION OFFICE (ATO) and MACTAN-CEBU INTERNATIONAL AIRPORT

AUTHORITY (MCIAA),petitioners, vs. APOLONIO GOPUCO, JR., respondent.

DECISION
CHICO-NAZARIO, J.:

When private land is expropriated for a particular public use, and that particular public use is abandoned,
does its former owner acquire a cause of action for recovery of the property?
The trial courts ruling in the negative was reversed by the Court of Appeals in its Decision [1] of 28 February
2001. Hence this petition for review under Rule 45 of the 1997 Rules of Civil Procedure of the said Decision of
the court a quo, and its Resolution[2] of 22 May 2003 dismissing petitioners motion for reconsideration.
The facts, as adduced from the records, are as follows:
Respondent Apolonio Gopuco, Jr. was the owner of Cadastral Lot No. 72 consisting of 995 square meters
located in the vicinity of the Lahug Airport in Cebu City covered by Transfer Certificate of Title (TCT) No.
13061-T.
The Lahug Airport had been turned over by the Unites States Army to the Republic of the Philippines
sometime in 1947 through the Surplus Property Commission, which accepted it in behalf of the Philippine
Government. In 1947, the Surplus Property Commission was succeeded by the Bureau of Aeronautics, which
office was supplanted by the National Airport Corporation (NAC). The NAC was in turn dissolved and replaced
with the Civil Aeronautics Administration (CAA).[3]
Sometime in 1949, the NAC informed the owners of the various lots surrounding the Lahug Airport,
including the herein respondent, that the government was acquiring their lands for purposes of expansion. Some
landowners were convinced to sell their properties on the assurance that they would be able to repurchase the
same when these would no longer be used by the airport. Others, including Gopuco, refused to do so.
Thus, on 16 April 1952, the CAA filed a complaint with the Court of First Instance (CFI) of Cebu for the
expropriation of Lot No. 72 and its neighboring realties, docketed as Civil Case No. R-1881.
On 29 December 1961, the CFI promulgated a Decision,

1. Declaring the expropriation of [the subject lots, including Lot No. 72] justified and in lawful exercise of the
right of eminent domain;

2. Declaring . a balance of P1,990 in favor of Apolonio Go Puco, Jr. with legal interest from November 16, 1947
until fully paid. ;

3. After the payment of the foregoing financial obligation to the landowners, directing the latter to deliver to the
plaintiff the corresponding Transfer Certificates of Title to their respective lots; and upon the presentation of the
said titles to the Register of Deeds, ordering the latter to cancel the same and to issue, in lieu thereof, new
Transfer Certificates of Title in the name of the plaintiff.[4]

No appeal was taken from the above Decision on Lot No. 72, and the judgment of condemnation became
final and executory. Thereafter, on 23 May 1962, absolute title to Lot No. 72 was transferred to the Republic of
the Philippines under TCT No. 25030.[5]
17
 Subsequently, when the Mactan International Airport commenced operations, the Lahug Airport was
ordered closed by then President Corazon C. Aquino in a Memorandum of 29 November 1989. [6] Lot No. 72
was thus virtually abandoned.[7]
On 16 March 1990, Gopuco wrote[8] the Bureau of Air Transportation, through the manager of the Lahug
Airport, seeking the return of his lot and offering to return the money previously received by him as payment
for the expropriation. This letter was ignored.[9]
In the same year, Congress passed Republic Act No. 6958 creating the Mactan-Cebu International Airport
Authority (MCIAA) and in part providing for the transfer of the assets of the Lahug Airport thereto.
Consequently, on 08 May 1992, ownership of Lot No. 72 was transferred to MCIAA under TCT No. 120356.[10]
On 06 August 1992, Apolonio Gopuco, Jr. filed an amended complaint[11] for recovery of ownership of Lot
No. 72 against the Air Transportation Office[12] and the Province of Cebu with the Regional Trial Court (RTC) of
Cebu, Branch X, docketed as Civil Case No. CEB-11914. He maintained that by virtue of the closure of the
Lahug Airport, the original purpose for which the property was expropriated had ceased or otherwise been
abandoned, and title to the property had therefore reverted to him.
Gopuco further alleged that when the original judgment of expropriation had been handed down, and
before they could file an appeal thereto, the CAA offered them a compromise settlement whereby they were
assured that the expropriated lots would be resold to them for the same price as when it was expropriated in the
event that the Lahug Airport would be abandoned. Gopuco claims to have accepted this offer. [13] However, he
failed to present any proof on this matter, and later admitted that insofar as the said lot was concerned, no
compromise agreement was entered into by the government and the previous owners.[14]
Lastly, Gopuco asserted that he had come across several announcements in the papers that the Lahug
Airport was soon to be developed into a commercial complex, which he took to be a scheme of the Province of
Cebu to make permanent the deprivation of his property.
On 20 May 1994, the trial court rendered a Decision[15] dismissing the complaint and directing the herein
respondent to pay the MCIAA exemplary damages, litigation expenses and costs.
Aggrieved by the holding of the trial court, Gopuco appealed to the Court of Appeals, which overturned the
RTC decision, ordered the herein petitioners to reconvey Lot No. 72 to Gopuco upon payment of the reasonable
price as determined by it, and deleted the award to the petitioners of exemplary damages, litigation expenses
and costs.
The Motion for Reconsideration was denied [16] on 22 May 2003, hence this petition, which raises the
following issues:

WHETHER THE COURT OF APPEALS ERRED IN HOLDING THAT RESPONDENT HAS THE RIGHT TO
RECLAIM OWNERSHIP OVER THE SUBJECT EXPROPRIATED LOT BASED ON THE IMPORT OF
THE DECEMBER 29, 1961 DECISION IN CIVIL CASE NO. 1881.

WHETHER THE COURT OF APPEALS ERRED IN DELETING THE AWARD OF LITIGATION EXPENSES
AND COSTS IN FAVOR OF PETITIONERS.

In deciding the original expropriation case that gave rise to the present controversy, Civil Case No. R-1881,
the CFI reasoned that the planned expansion of the airport justified the exercise of eminent domain, thus:

As for the public purpose of the expropriation proceeding, it cannot be doubted. Although the Mactan Airport is
being constructed, it does not take away the actual usefulness and importance of the Lahug Airport; it is
handling the air traffic both civilian and military. From it aircrafts fly to Mindanao and Visayas and pass thru it
on their return flights to the North and Manila. Then, no evidence was adduced to show how soon is the Mactan
Airport to be placed in operation and whether the Lahug Airport will be closed immediately thereafter. It is for
the other departments of the Government to determine said matters. The Court cannot substitute its judgment for

18
those of the said departments or agencies. In the absence of such a showing, the Court will presume that the
Lahug Airport will continue to be in operation.[17] (emphasis supplied)

By the time Gopuco had filed his action for recovery of ownership of Lot No. 72, Lahug Airport had indeed
ceased to operate. Nevertheless, the trial court held:

The fact of abandonment or closure of the Lahug Airport admitted by the defendant did not by itself, result in
the reversion of the subject property back to the plaintiff. Nor did it vest in the plaintiff the right to demand
reconveyance of said property.

When real property has been acquired for public use unconditionally, either by eminent domain or by purchase,
the abandonment or non-use of the real property, does not ipso facto give to the previous owner of said property
any right to recover the same (Fery vs. Municipality of Cabanatuan, 42 Phil. 28).[18]

In reversing the trial court, the Court of Appeals called attention to the fact that both parties cited Fery v.
Municipality of Cabanatuan,[19] which the trial court also relied on in its Decision. The court a quo agreed in
Gopucos interpretation of Fery that when the CFI in Civil Case No. R-1881 held that,

. . . [T]hen, no evidence was adduced to show how soon is the Mactan Airport to be placed in operation and
whether the Lahug Airport will be closed immediately thereafter.In the absence of such a showing, the Court
will presume that the Lahug Airport will continue to be in operation, . . . .[20]

the expropriation of the property was conditioned on its continued devotion to its public purpose. Thus,
although the MCIAA stressed that nothing in the judgment of expropriation expressly stated that the lands
would revert to their previous owners should the public use be terminated or abandoned, the Court of Appeals
nevertheless ruled that,

. . . [W]hile, there is no explicit statement that the land is expropriated with the condition that when the purpose
is ended the property shall return to its owner, the full import of the decision (in Civil Case No. R-1881)
suggests that the expropriation was granted because there is no clear showing that Lahug Airport will be closed,
the moment Mactan International Airport is put to operation. It stands to reason that should that public use be
abandoned, then the expropriated property should revert back to its former owner.

Moreover, the foundation of the right to exercise the power of eminent domain is genuine necessity.
Condemnation is justified only if it is for the public good and there is genuine necessity of a public character.
Thus, when such genuine necessity no longer exists as when the State abandons the property expropriated,
government interest must yield to the private right of the former land owner, whose property right was disturbed
as a consequence of the exercise of eminent domain.

Justice, equity and fair play demand that the property should revert back to plaintiff-appellant upon paying the
reasonable value of the land to be based on the prevailing market value at the time of judicial demand to recover
the property. If the State expects landowners to cooperate in its bid to take private property for its public use, so
must it apply also the same standard, to allow the landowner to reclaim the property, now that the public use has
been abandoned.[21]

In this petition, the MCIAA reiterates that the Republic of the Philippines validly expropriated Lot No. 72
through the proceedings in Civil Case No. R-1881, the judgment of which had long become final and executory.
It further asserts that said judgment vested absolute and unconditional title in the government, specifically on
the petitioners, there having been no condition whatsoever that the property should revert to its owners in case
the Lahug Airport should be abandoned.

19
 On the other hand, the respondent would have us sustain the appellate courts interpretation of Fery as
applied to the original judgment of expropriation, to the effect that this was subject to the condition that the
Lahug Airport will continue to be in operation.
We resolve to grant the petition.
In Fery, the Court asked and answered the same question confronting us now: When private land is
expropriated for a particular public use, and that particular public use is abandoned, does the land so
expropriated return to its former owner?[22]

The answer to that question depends upon the character of the title acquired by the expropriator, whether it be
the State, a province, a municipality, or a corporation which has the right to acquire property under the power of
eminent domain. If, for example, land is expropriated for a particular purpose, with the condition that when
that purpose is ended or abandoned the property shall return to its former owner, then, of course, when
the purpose is terminated or abandoned the former owner reacquires the property so expropriated. If, for
example, land is expropriated for a public street and the expropriation is granted upon condition that the city can
only use it for a public street, then, of course, when the city abandons its use as a public street, it returns to the
former owner, unless there is some statutory provision to the contrary. . . If upon the contrary, however, the
decree of expropriation gives to the entity a fee simple title, then of course, the land becomes the absolute
property of the expropriator, whether it be the State, a province, or municipality, and in that case the non-user
does not have the effect of defeating the title acquired by the expropriation proceedings. (10 R.C.L., 240, sec.
202; 20 C.J. 1234, secs. 593-599 and numerous cases cited; Reichling vs. Covington Lumber Co., 57 Wash.,
225; 135 Am. St. Rep., 976; McConihay vs. Wright, 121 U.S., 201.)

When land has been acquired for public use in fee simple, unconditionally, either by the exercise of
eminent domain or by purchase, the former owner retains no rights in the land, and the public use may
be abandoned or the land may be devoted to a different use, without any impairment of the estate or title
acquired, or any reversion to the former owner. (Fort Wayne vs. Lake Shore, etc. Ry. Co., 132 Ind., 558; 18
L.R.A., 367.) (Emphases Supplied)[23]

Did the judgment of expropriation in Civil Case No. R-1881 vest absolute and unconditional title in the
government? We have already had occasion to rule on this matter in Mactan-Cebu International Airport
Authority v. Court of Appeals,[24] which is a related action for reconveyance of a parcel of land also subject of
the expropriation proceedings in Civil Case No. R-1881. One of the landowners affected by the said proceeding
was Virginia Chiongbian, to whom the CFI ordered the Republic of the Philippines to pay P34,415.00, with
legal interest computed from the time the government began using her land. Like the herein respondent, she did
not appeal from the CFIs judgment. Also like Gopuco, she eventually filed for the reconveyance of her property
when the airport closed. Although she was upheld by both the RTC of Cebu and the Court of Appeals, on appeal
we held that the terms of the judgment (in Civil Case No. R-1881) are clear and unequivocal and granted
title to Lot No. 941 in fee simple to the Republic of the Philippines. There was no condition imposed to the
effect that the lot would return to CHIONGBIAN or that CHIONGBIAN had a right to repurchase the
same if the purpose for which it was expropriated is ended or abandoned or if the property was to be
used other than as the Lahug Airport.[25] Moreover, we held that although other lot owners were able to
successfully reacquire their lands by virtue of a compromise agreement, since CHIONGBIAN was not a party
to any such agreement, she could not validly invoke the same.
The respondent would have us revisit this ruling for three reasons. First, because he claims there is no
showing that the government benefited from entering into compromise agreements with the other lot owners;
second, because such a doctrine supposedly discriminates against those who have neither the werewithal nor the
savvy to contest the expropriation, or agree to modify the judgment; and third, because there exists between the
government and the owners of expropriated realty an implied contract that the properties involved will be used
only for the public purpose for which they were acquired in the first place.

20
 As to respondents first and second arguments, we have time and again ruled that a compromise agreement,
when not contrary to law, public order, public policy, morals, or good customs, is a valid contract which is the
law between the parties.[26] It is a contract perfected by mere consent, [27] whereby the parties, making reciprocal
concessions, avoid litigation or put an end to one already commenced. It has the force of law and is conclusive
between the parties,[28] and courts will not relieve parties from obligations voluntarily assumed, simply because
their contracts turned out to be unwise. [29] Note that respondent has not shown that any of the compromise
agreements were in any way tainted with illegality, irregularity or imprudence. Indeed, anyone who is not a
party to a contract or agreement cannot be bound by its terms, and cannot be affected by it.[30] Since Gopuco was
not a party to the compromise agreements, he cannot legally invoke the same.[31]
Lastly, Gopuco argues that there is present, in cases of expropriation, an implied contract that the properties
will be used only for the public purpose for which they were acquired. No such contract exists.
Eminent domain is generally described as the highest and most exact idea of property remaining in the
government that may be acquired for some public purpose through a method in the nature of a forced purchase
by the State.[32] Also often referred to as expropriation and, with less frequency, as condemnation, it is, like
police power and taxation, an inherent power of sovereignty and need not be clothed with any constitutional
gear to exist; instead, provisions in our Constitution on the subject are meant more to regulate, rather than to
grant, the exercise of the power. It is a right to take or reassert dominion over property within the state for
public use or to meet a public exigency and is said to be an essential part of governance even in its most
primitive form and thus inseparable from sovereignty.[33] In fact, all separate interests of individuals in property
are held of the government under this tacit agreement or implied reservation. Notwithstanding the grant to
individuals, the eminent domain, the highest and most exact idea of property, remains in the government, or in
the aggregate body of people in their sovereign capacity; and they have the right to resume the possession of
the property whenever the public interest so requires it.[34]
The ubiquitous character of eminent domain is manifest in the nature of the expropriation proceedings.
Expropriation proceedings are not adversarial in the conventional sense, for the condemning authority is not
required to assert any conflicting interest in the property. Thus, by filing the action, the condemnor in effect
merely serves notice that it is taking title and possession of the property, and the defendant asserts title or
interest in the property, not to prove a right to possession, but to prove a right to compensation for the taking.[35]
The only direct constitutional qualification is thus that private property shall not be taken for public use
without just compensation.[36] This prescription is intended to provide a safeguard against possible abuse and so
to protect as well the individual against whose property the power is sought to be enforced.[37]
In this case, the judgment on the propriety of the taking and the adequacy of the compensation received
have long become final. We have also already held that the terms of that judgment granted title in fee simple to
the Republic of the Philippines. Therefore, pursuant to our ruling in Fery, as recently cited in Reyes v. National
Housing Authority,[38] no rights to Lot No. 72, either express or implied, have been retained by the herein
respondent.
We are not unaware of the ruling in Heirs of Timoteo Moreno v. Mactan-Cebu International Airport
Authority,[39] concerning still another set of owners of lots declared expropriated in the judgment in Civil Case
No. R-1881. As with Chiongbian and the herein respondent, the owners of the lots therein did not appeal the
judgment of expropriation, but subsequently filed a complaint for reconveyance. In ordering MCIAA to
reconvey the said lots in their favor, we held that the predicament of petitioners therein involved a constructive
trust akin to the implied trust referred to in Art. 1454[40] of the Civil Code.[41] However, we qualified our
Decision in that case, to the effect that,

We adhere to the principles enunciated in Fery and in Mactan-Cebu International Airport Authority, and do not
overrule them. Nonetheless the weight of their import, particularly our ruling as regards the properties of
respondent Chiongbian in Mactan-Cebu International Airport Authority, must be commensurate to the facts that
were established therein as distinguished from those extant in the case at bar. Chiongbian put forth

21
inadmissible and inconclusive evidence, while in the instant case we have preponderant proof as found by
the trial court of the existence of the right of repurchase in favor of petitioners.

Neither has Gopuco, in the present case, adduced any evidence at all concerning a right of repurchase in his
favor. Heirs of Moreno is thus not in point.
The trial court was thus correct in denying Gopucos claim for the reconveyance of Lot No. 72 in his favor.
However, for failure of the petitioners to present any proof that this case was clearly unfounded or filed for
purposes of harassment, or that the herein respondent acted in gross and evident bad faith, the reimposition of
litigation expenses and costs has no basis. It is not sound public policy to set a premium upon the right to
litigate where such right is exercised in good faith, as in the present case.[42]
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No.
49898 dated 28 February 2001, and its Resolution of 22 May 2003 are hereby REVERSED and SET ASIDE.
The Decision of RTC-Branch X of Cebu dated 20 May 1994 in Civil Case No. CEB-11914 is REINSTATED
with the modification that the award of exemplary damages, litigation expenses and costs are DELETED.
SO ORDERED.

22
 FIRST DIVISION

PATRICIA L. TIONGSON, PACITA G.R. No. 166964

L. GO, ROBERTO LAPERAL III,
ROSA R. MANOTOK, GEORGE M.
BOCANEGRA, PHILIP L. MANOTOK,
MARIA TERESA M. ESCALER,
JOSE CLEMENTE L. MANOTOK,
RAMON SEVERINO L. MANOTOK,
THELMA R. MANOTOK, JOSE MA.
MANOTOK, JESUS JUDE MANOTOK,
JR., MA. THELMA R. MANOTOK,
SEVERINO MANOTOK III, MA.
MAMERTA MANOTOK, FERNANDO
MANOTOK, FROILAN MANOTOK,
SEVERINO MANOTOK IV, FAUSTO
MANOTOK, FAUSTO MANOTOK III,
MILAGROS M. DORMIDO, IGNACIO V.
MANOTOK, JR., FELISA MYLENE V.
MANOTOK, MARY ANNE V. MANOTOK,
MICHAEL MARSHALL V. MANOTOK,
MA. CRISTINA E. SISON AND MIGUEL
A.B. SISON, represented by their
Attorney-in-fact, ROSA R. MANOTOK,
Petitioners, Present:
Davide, Jr., C.J. (Chairman),

- versus - Quisumbing,

Ynares-Santiago,

Carpio, and

Azcuna, JJ.

NATIONAL HOUSING AUTHORITY,

Respondent. Promulgated:

October 11, 2005

x ---------------------------------------------------------------------------------------- x

DECISION

YNARES-SANTIAGO, J.:

This petition for review on certiorari seeks to set aside the March 25, 2004 Decision [1] of the Court of Appeals in
CA-G.R. CV No. 70209, and its February 4, 2005 Resolution, [2] which denied petitioners motion for
reconsideration.

23
The facts show that on April 3, 1987, respondent National Housing Authority (NHA) filed a complaint for
eminent domain with the Regional Trial Court of Manila, Branch 35, against petitioners who are owners of
several lots located in Tondo, Manila with a total area of 66,783.40 square meters and an aggregate value of
P21,024,136.50. Instead of an answer, petitioners filed motions to dismiss with prayer for actual, moral and
exemplary damages and attorneys fees.

On March 11, 1988, NHA deposited the amount of P21,107,485.07 with the Philippine National Bank (PNB) as
provisional just compensation for the subject lots, as evidenced by Certificate of Time Deposit No. 233991-B.
The deposit is now under PNB (Escolta Branch) Fiduciary Account No. 068-576012-6.

On March 11, 1991, the trial court rendered a Decision, the dispositive portion of which states:

WHEREFORE, the prayer of the defendants in their motion to dismiss is GRANTED,

and the complaint of the plaintiff is DISMISSED.

The counterclaims of the defendants are also ordered DISMISSED.

No pronouncement as to costs.[3]

The Court of Appeals affirmed the lower court in a Decision dated February 26, 1993. On petition before this
Court, we resolved to declare the case terminated for failure of NHA to file the petition on time. The resolution
became final and executory on July 26, 1993.

Thus, NHA filed on September 7, 2000 a motion for leave of court to withdraw deposit but failed to specify a
date for hearing. On October 30, 2000, NHA filed a second motion for leave to withdraw deposit which set the
hearing on November 10, 2000.

On November 8, 2000, the trial court issued an Order [4] expunging the first motion from the records. It also
declared that the amount sought to be withdrawn by NHA constitutes advance payment if the expropriation
proceeds, and as indemnity for damages should the proceedings not succeed, as in the instant case. The trial
court noted that petitioners might have sustained damages in the course of the expropriation proceedings which
they could pursue or waive. The motion being litigious, the trial court declared that the same be set for hearing.

NHAs motion for reconsideration was denied on December 8, 2000.[5]

On appeal, the Court of Appeals held that the dismissal of petitioners counterclaim barred them from presenting
evidence to prove damages. It ruled that the trial courts assessment that they suffered damages is conjectural
and inconsistent with the dismissal of the counterclaim.

The dispositive portion of the Court of Appeals Decision reads:

WHEREFORE, the order of the Regional Trial Court of Manila (Branch 35) dated

November 8, 2000 is REVERSED and SET ASIDE and that Court is directed to release to the

24
 National Housing Authority the amount of P21,107,485.07, represented by PNB (Escolta branch)

Fiduciary Account No. 068-576012-6, including accrued interest thereon.

SO ORDERED.[6]

Petitioners motion for reconsideration was denied, hence, the instant petition based on the following issues:
I. THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF

DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN

ACTING AND GRANTING THE MOTION FILED BY RESPONDENT NHA FOR

WITHDRAWAL OF ITS DEPOSIT IN QUESTION ALTHOUGH SAID MOTION

SHOULD HAVE BEEN TREATED AS A MERE SCRAP OF PAPER FOR LACK OF

NOTICE OF HEARING.

II. THE HONORABLE COURT OF APPEALS HAD ALSO COMMITTED GRAVE ABUSE

OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN

GRANTING THE MOTION OF RESPONDENT NHA TO WITHDRAW ITS DEPOSIT

IN QUESTION EVEN BEFORE A HEARING ON SAID ISSUE CAN BE HELD TO

DETERMINE THE AMOUNT OF DAMAGES SUFFERED BY PETITIONERS

MANOTOK RESULTING FROM THE FINAL DISMISSAL OF THE COMPLAINT

FOR EXPROPRIATION OF THEIR SUBJECT LOTS.

The petition lacks merit.

Expropriation proceedings, or the procedure to enforce the states right of eminent domain, are governed
by Rule 67 of the Rules of Court. There are two stages in every action for expropriation: first, condemnation of
the property after determination that its acquisition is for public purpose; and, second, the ascertainment of just
compensation.[7]

During the condemnation stage, the court may either issue 1) an order of expropriation, declaring that the
plaintiff has a lawful right to take the property sought to be condemned for public use or purpose, or 2) an order
of dismissal, if it appears that the expropriation is not for some public use.

In the case at bar, the trial court dismissed NHAs complaint for expropriation upon determination that its
acquisition is not for public purpose. Along with the dismissal of the complaint, the trial court also dismissed
the counterclaim interposed by petitioners. The Court of Appeals correctly held that this counterclaim for actual,
moral and exemplary damages and attorneys fees is compulsory. As such, it is auxiliary to the proceeding in the
original suit and derives its jurisdictional support therefrom. In the case of Financial Building Corp. v. Forbes
Park Assoc., Inc.,[8] we stated:
... A counterclaim presupposes the existence of a claim against the party filing the counterclaim.
Hence, where there is no claim against the counterclaimant, the counterclaim is improper and it
must be dismissed, more so where the complaint is dismissed at the instance of the
counterclaimant. In other words, if the dismissal of the main action results in the dismissal of the
25
 counterclaim already filed, it stands to reason that the filing of a motion to dismiss the complaint
is an implied waiver of the compulsory counterclaim because the grant of the motion ultimately
results in the dismissal of the counterclaim.[9]

The aforementioned doctrine is in consonance with the primary objective of a counterclaim which is to
avoid and prevent circuity of action by allowing the entire controversy between the parties to be litigated and
finally determined in one action, wherever this can be done with justice to all parties concerned.[10]

It is true that we held in National Power Corporation v. Court of Appeals[11] (NAPOCOR) that when the
defendant claims that his land suffered damage because of the expropriation, the dismissal of the action should
not foreclose the defendants right to have the damages ascertained either in the same case or in a separate
action.[12] However, this pronouncement is not applicable in the instant case.

In the NAPOCOR case, the motion to dismiss was filed not only by the property owner, Pobre, but also
by the expropriating authority. In the instant case, only the property owners moved to dismiss the complaint.
When the trial court granted NAPOCORs motion to dismiss, it also allowed Pobre to adduce evidence on his
claim for damages. In effect, the trial court made a reservation to allow Pobre to recover damages. Thereafter,
Pobre presented evidence and recounted in detail the scope of damage caused by NAPOCOR. In contrast, the
court below dismissed petitioners counterclaim without reservation as to their claim for damages. Petitioners
did not adduce evidence as to the extent of damage caused by NHA. NHA appealed the dismissal of the
complaint while petitioners opted not to appeal the dismissal of their counterclaim. The dismissal of the
complaint for expropriation became final and executory on July 26, 1993. Plainly, the same is already beyond
review.

Thus, on September 7, 2000 or after seven years from the finality of the dismissal of the complaint for
expropriation, NHA filed a motion for leave to withdraw the deposit. Petitioners did not oppose the motion. In
fact, the records are bereft of evidence that petitioners took action to pursue their claim for damages during the
entire seven years. They did not file a motion or pleading in court to ask for a hearing or to claim the damages
they now seek. Clearly, they cannot claim to have been deprived of due process as they had the time and
opportunity to pursue their claim for the damages they may have sustained as a result of the filing of the
complaint for expropriation.

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated March
25, 2004 and February 4, 2005 in CA-G.R. CV No. 70209, respectively, are hereby AFFIRMED in toto.

SO ORDERED.

26
 SECOND DIVISION
EUGENIO G. PALILEO, LAURO G. G.R. No. 148574
PALILEO AND THE HEIRS OF AURELIO
G. PALILEO, NAMELY: AURELIO
PALILEO, OLIVIA L. PALILEO AND Present:
TEOFILO L. PALILEO,
PUNO,
P e t i t i o n e r s, Chairman,
AUSTRIA-MARTINEZ,

- versus - CALLEJO, SR.,

TINGA, and
NATIONAL IRRIGATION CHICO-NAZARIO, JJ.
ADMINISTRATION,

R e s p o n d e n t.
Promulgated:

October 11, 2005

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CHICO-NAZARIO, J.:

This is an appeal by certiorari from the Decision[1] dated 10 April 2001 of the Court of Appeals in CA-
GR CV No. 62854, reversing the Decision of the Regional Trial Court of San Pablo City, Laguna, Branch 30, in
Civil Case No. SP-4270 for recovery of possession with damages which ordered respondent National Irrigation
Administration (NIA) to pay petitioners P100,000 with legal interest for its use of the land. Likewise assailed is
the Resolution[2] dated 15 June 2001 denying petitioners motion for reconsideration.

The appeal stemmed from the antecedents per summary of the Court of Appeals which we paraphrase as

follows:

Lot 1, Psu-26200 situated at Barangay Manaol, Municipality of Nagcarlan, Province of Laguna, was
originally registered under Original Certificate of Title No. 2140 pursuant to Decree No. 13700 in the name of
Olivia Gomez Vda. De Palileo, mother of petitioners Eugenio G. Palileo, Lauro G. Palileo and the late Aurelio
G. Palileo, herein represented by his heirs.[3]

Petitioners are in possession of the subject property, having inherited the same from their mother who
died on 14 January 1980. Said parcel of land was subdivided into three (3) lots namely: (1) Lot 1-A, with an
area of 61,595 square meters, registered in the name of petitioner Eugenio G. Palileo under Transfer Certificate
of Title No. T-152619; (2) Lot 1-B, with an area of 61,596 square meters, registered in the names of the heirs of
Aurelio G. Palileo, herein petitioners Aurelio L. Palileo, Olivia L. Palileo and Teofilo L. Palileo under Transfer
Certificate of Title No. T-152620; and (3) Lot 1-C, with an area of 61,596 square meters, registered in the name
of petitioner Lauro G. Palileo under Transfer Certificate of Title No. T-152621, all of the Registry of Deeds for
the Province of Laguna.[4] The transfer of title in petitioners name was entered in the books of the Registry of
Deeds of Laguna on 12 September 1994.[5]

27
 Respondent NIA, on the other hand, has been on the property since 1956, having built thereon a canal in
1956 and an access road in 1983. NIA access road and the canal took an area of over 10,000 square meters.
Records of respondent showed that the lot occupied by the canal was expropriated by virtue of a court order as
early as 24 February 1958 and that information regarding the construction of access roads, under a foreign-
assisted program, had been disseminated by the respondent among municipal mayors sometime in April 1978. It
does not appear, however, whether payment of just compensation had been made upon such expropriated
property of herein petitioners.[6]

Records likewise bear out that the respective lots of petitioners were benefited by the irrigation system
of the respondent. In a letter dated 11 January 1994, respondent NIA assessed petitioner Olivia Palileo irrigation
service fee amounting to P16,221.40.[7]

Shortly, in a letter dated 28 March 1994, petitioner Eugenio Palileo made a formal claim for reasonable
rentals on the affected portions of the land. Since their demands were refused by the respondent, petitioners
instituted the present action on 10 July 1995 for recovery of possession with damages against the respondent
alleging that respondent illegally constructed an irrigation canal with an adjacent road, eating up a total of
10,570 square meters. Petitioners prayed for a judgment: (a) underscoring the fact that they are the lawful
registered owners of the 10,570 square meter-portion of the lot taken by the defendant unlawfully; (b) ordering
the respondent to bestow peaceful possession of the subject property to petitioners; and (c) ordering the
respondent to pay petitioners reasonable compensation for the continued use of the subject portion during all the
time prior to this suit in the sum of not less than P100,000.00, acceptance fee, moral and exemplary damages as
well as litigation expenses.[8]

In its Answer with Counterclaim and Affirmative Defenses, respondent, represented by the Office of the
Government Corporate Counsel, alleged that it is empowered and authorized under par. (e), Sec. 1 of
Presidential Decree No. 552 (P.D. No. 552), amending certain sections of Republic Act No. 3601 entitled, An
Act Creating the National Irrigation Administration to acquire, by any mode of acquisition, real and personal
properties and all appurtenant rights, easements, concessions and privileges, whether the same are already
devoted to private or public use in connection with the development of projects by the NIA.[9]

Respondent further stated in its Answer that the subject parcels of land were devoted to irrigation project
since 1956 and acquired by NIAs predecessors through expropriation proceedings which was granted per Court
Order released on 24 February 1958. With respect to the NIA road, it is unflinching in saying that sometime in
1978 to 1979, a Memorandum of Agreement between NIA and petitioners predecessors-in-interest was executed
for the occupation of the subject parcels of land and the cutting down of its fruit bearing trees and that notices of
the proposed construction of NIA access roads and other irrigation facilities were disseminated to the municipal
mayors and farmers on 27 April 1978 to allow NIA to proceed with the construction. Respondent added that due
compensation on plant damages was given on 27 June 1984.[10] Finally, respondent opined that the present
action has already prescribed pursuant to par. (3), Sec. 1 of P.D. No. 552. Respondent thus prayed that judgment
be rendered dismissing the complaint for utter lack of merit and on its counterclaim, that petitioners be ordered
to pay respondent the sums of P155,317.65 as payment of their unpaid irrigation service fee and 20% thereof as
attorneys fees and costs of suit.[11]

28
 On 6 January 1998, the trial court rendered judgment in favor of the petitioners in the following tenor:
1. Plaintiffs being the lawful and registered owners of the 10,570 square meters of land
usurped by the defendant the herein defendant is hereby ordered to pay the plaintiffs the sum of
P100,000.00 for its use of the land with legal interest from 1956 until fully paid; P10,000.00 for
attorneys fees and P15,000.00 for litigation expenses and to pay the costs.

Defendants counterclaim is hereby DISMISSED.[12]

Respondents motion for reconsideration failed to sway the trial court. On appeal, the Court of Appeals
promulgated the assailed Decision dated 10 April 2001 reversing the decision of the trial court, with the fallo:

WHEREFORE, premises considered, the appeal is hereby GRANTED. The appealed

Decision in Civil Case No. SP-4270 is hereby REVERSED and SET ASIDE and a new
judgment is hereby rendered DISMISSING the complaint. Plaintiffs-appellees are hereby
ordered to pay to appellant NIA the sum of P155,317.65 representing unpaid irrigation
fees/administration charges with interest at 6% per annum from June 30, 1994 until fully paid.

No pronouncement as to costs.[13]

Petitioners were likewise unsuccessful in moving for the reconsideration of the Court of Appeals Decision.
Hence, hard done by the ruling, petitioners elevated the matter to us via the instant appeal, opposing the
Decision and Resolution of the Court of Appeals on the following assignment of errors:
I. THE COURT A QUO COMMITTED A SERIOUS ERROR IN LAW IN RULING
THAT UNDER NIAS CHARTER, PETITIONERS CAUSE OF ACTION TO SEEK
COMPENSATION FOR NIAS USE/EXPROPRIATION OF EXPROPRIATED
PROPERTIES HAD LONG PRESCRIBED.

II. THE COURT A QUO COMMITTED A SERIOUS ERROR IN LAW IN HOLDING

PETITIONERS LIABLE FOR IRRIGATION FEES DESPITE THE ABSENCE OF ANY
AGREEMENT WITH THE LATTER.[14]

The pith of this controversy is whether or not the Court of Appeals committed reversible error in setting
aside the ruling of the trial court. Concretely, the questions are: (1) whether prescription bars petitioners
claims and (2) whether petitioners are liable to respondent for irrigation fees.

Petitioners, in their brief, ardently argue that the Court of Appeals overlooked the fact that there is no

record of any payment of just compensation to the petitioners and there was no expropriation case filed by

respondent with regard to its taking in 1983 of a portion of petitioners property for use as access road. [15] They

are effusive on their argument that there is no basis to hold them liable to respondent for irrigation dues as there

was no agreement between petitioners and respondent for the latter to render irrigation service on their

properties.[16]

En contra, respondent waxes lyrical that the subject parcels of land were devoted for the irrigation

project since 1956, and were acquired by respondents predecessor, the Department of Public Works and

Highways, thru expropriation proceedings, which the expropriations court granted in an order dated 24 February

29
1958.[17] As regards the access road, a memorandum of agreement was executed between respondent and

petitioners predecessors-in-interest for the occupation of the subject parcels of land and the cutting down of its

fruit-bearing trees, so says respondent.[18] Finally, respondent whips up support for its contention that the Court

of Appeals correctly awarded the payment of irrigation fees to it inasmuch as petitioners lands benefited from

the irrigation system of respondent.[19]

We are not inclined to acquiesce in petitioners viewpoint.

The 1987 Constitution explicitly provides for the exercise of the power of eminent domain over private

properties upon payment of just compensation.[20] In Republic of the Philippines v. Court of Appeals,[21] the

Court characterized the power of eminent domain in this wise:

The right of eminent domain is usually understood to be an ultimate right of the
sovereign power to appropriate any property within its territorial sovereignty for a public
purpose. Fundamental to the independent existence of a State, it requires no recognition by the
Constitution, whose provisions are taken as being merely confirmatory of its presence and as
being regulatory, at most, in the due exercise of the power. In the hands of the legislature, the
power is inherent, its scope matching that of taxation, even that of police power itself, in many
respects. It reaches to every form of property the State needs for public use and, as an old case
so puts it, all separate interests of individuals in property are held under a tacit agreement or
implied reservation vesting upon the sovereign the right to resume the possession of the property
whenever the public interest so requires it.

The ubiquitous character of eminent domain is manifest in the nature of the expropriation
proceedings. Expropriation proceedings are not adversarial in the conventional sense, for the
condemning authority is not required to assert any conflicting interest in the property. Thus, by
filing the action, the condemnor in effect merely serves notice that it is taking title and
possession of the property, and the defendant asserts title or interest in the property, not to prove
a right to possession, but to prove a right to compensation for the taking.

The constitutional restraints are public use and just compensation. [22] Here, the expropriated property has

been shown to be for the continued utilization by the NIA of irrigation canal and access road, which property

has assumed a public character upon its expropriation. However, the court order, which is the best evidence to

prove that the area covered by the irrigation canal was indeed expropriated pursuant to an order of the court,

was not adduced in evidence. Notwithstanding the absence of the court order, we are inclined to give more

credence to the respondents explanation that the construction of the canal was by virtue of a court order dated

24 February 1958.

For one, the records bear out a photocopy of an entry in NIAs Log Book stating that the lot supposedly

occupied by the irrigation canal was expropriated by virtue of a court order released on 24 February 1958. [23] On

record, too, is a Certification[24] dated 9 May 1997 issued by the Land Irrigation System Custodian, Erlinda A.

Payra, stating that the aforesaid photocopy of the entry in NIAs log book is a true and faithful reproduction of

the original. Said certification was subscribed before the Clerk of Court of Sta. Cruz, Laguna. The entry in the

log book and the certification issued by the Land Irrigation System custodian must be considered admissible

and competent evidence as they form part of official records. This is pursuant to the rule that entries in official
30
records made in the performance of his duty by a public officer are prima facie evidence of the facts therein

stated.[25] Having been made by public officers in the performance of their duties, theevidentiary value of such

document must, therefore, be sustained in the absence of strong, complete and conclusive proof of its falsity or

nullity.[26]

Moreover, there is no dispute that the irrigation canal of respondent has been in existence dating back

1956 and that it was devoted to public use. Case law has it that the unpaid landowner can not recover possession

of property taken for public use even while no requisite expropriation proceedings were first instituted.[27] The

landowner was merely given the relief of recovering compensation for his property computed at its market

value at the time it was taken and appropriated by the State.[28]

Alfonso v. Pasay City[29] is a case where there was no expropriation proceedings but this Court denied

recovery of possession by the registered owner of a portion of a private lot taken by the Pasay City and used for

road purposes and instead decreed payment of its market value at the time it was taken and appropriate. It

would, therefore, make no difference that the order of expropriation for the irrigation canal was not adduced in

evidence in the case at bar because under prevailing jurisprudence, [30] whether or not there was expropriation

proceedings, the only relief available to the owner of the private property taken for public use is to recover

compensation.

In the same way, it is immaterial that respondent failed to produce the memorandum of agreement for

the access road, which agreement respondent NIA claims to have entered into with petitioners predecessor-in-

interest. From the evidence on record, respondent NIA has occupied, utilized and, for all intents and purposes,

exercised dominion over the property. Further, it is undisputed that the access road was taken by respondent for

public use. Hence, such taking, even in the absence of an order of expropriation or memorandum of agreement,

shall not entitle the owner to the recovery of possession but only to just compensation, following existing case

law. [31]
It is on the matter of compensation which is of foremost concern in the case at bar inasmuch as
petitioners pummel on their claim that they were not paid for the lot taken by respondent on which the irrigation
canal and the access road were built. Petitioners would pound on the dearth of evidence to prove payment of
just compensation.
True, in expropriation proceedings, the owner of the private property taken for public use is entitled, as a
matter of right, to just compensation, but more to the point, P.D. No. 552, which took effect in 1974, has
provided for the period upon which all actions against the NIA for compensation must be instituted. P.D. No.
552 added the following paragraph to Republic Act No. 3601 (An Act Creating the National Irrigation
Administration):

Sec. 1. . . .

(e) To acquire, by any mode of acquisition, real and personal properties, and all
appurtenant rights, easements, concessions and privileges, whether the same are already devoted
to private or public use in connection with the development of projects by the NIA;
31
 The National Irrigation Administration is empowered to exercise the right of eminent
domain in the manner provided by law for the institution of expropriation proceedings.

All actions for the recovery of compensation and damages against the National Irrigation
Administration under paragraphs (1), (2), and (3) hereof, shall be filed with a competent court
within five (5) years from the date of entry of the land or destruction of the improvements or
crops, after which period, the right of possession and/or ownership of the NIA shall be
considered vested and absolute. All other actions for the recovery of compensation and damages
to private property and improvements occasioned by the construction, operation and maintenance
of irrigation facilities and other hydraulic structures under the administration of the National
Irrigation Administration, which have accrued ten (10) or more years prior to the approval of
this decree are deemed to have prescribed and are barred forever.

With respect to the irrigation canal occupied by respondent, the above-quoted provision of P.D. No. 552

provides that all other actions for the recovery of compensation and damages to private property and

improvements which have accrued ten or more years prior to the approval of this decree (in 1974) are deemed

to have prescribed and are barred forever. Inasmuch as the canal was built as early as 1956, it is therefore clear

that the claim for compensation with respect to the lot occupied by the irrigation canal is already time barred for

having accrued 18 years prior to the approval of P.D. No. 552 in 1974.

As for the access road which was built in 1983, P.D. No. 552 provides that claims for compensation and

damages ought to be taken within five years from the time it was built in 1983, or on or before 1988. As earlier

noted, petitioners first instituted this proceeding for payment against respondent only in 1995. The unusually

long delay in bringing the action to compel payment against herein respondent would militate against them

consistently with the rule that one should take good care of his own concern.[32]

As pointed out by the Court of Appeals with alacrity, Sec. 1(e) of P.D. No. 552 expressly provided for

the prescriptive periods within which any action for recovery of compensation and damages as a result of

appellant NIAs exercise of the right of eminent domain may be filed. The Civil Code itself provided that the

prescriptions of actions in the Civil Code are without prejudice to those specified in special laws, which in this

case is P.D. No. 552. Thus, Article 1115 of the Civil Code provides-

ART. 1115. The provisions of the present Title are understood to be without prejudice to
what in this Code or in special laws is established with respect to specific cases of prescription.

In fine, it is immaterial that respondent was unable to produce proof of payment of the lot occupied by

the latters irrigation canal and access road because in any event, all claims for payment by petitioners has

already prescribed by virtue of the explicit provisions of P.D. No. 552. We can not feign a blind eye to the fact

that the present action was triggered by the respondents demand for irrigation fees against petitioners on 11

January 1994. Subsequent to the receipt of the demand letter by petitioners through their tiller, petitioner

Eugenio G. Palileo wrote respondent on 28 March 1994 claiming payment for the right of way. On 12

September 1994, petitioners caused the transfer of the property in their name and in July 1995, commenced the

32
present action. Indeed, the series of events culminating in the filing of the present suit would demonstrate that

the present action was precipitated by the respondents demand for payment of irrigation fees, which, to us,

constitutes a valid and legal claim.

On this note, we affirm the findings as well as conclusions of facts of the Court of Appeals, to wit:

As to appellants counterclaim for the payment by plaintiffs-appellees of irrigation fees or

administration charges, We find the same to have legal basis and the amount thereof sufficiently
established by the evidence on record. Except for their bare denial of such unpaid irrigation or
administration fees owing to the appellant NIA, plaintiffs-appellees had not shown by evidence
that they, through their tenants, had not been benefited by the irrigation service provided by the
appellant for several years now. Sec. 1 (b) of P.D. No. 552 expressly provided that NIA has the
right to enforce the collection of such unpaid irrigation or administration charges by judicial
action and such shall even be preferred liens first, upon the land benefited, and then on the crops
raised thereon.[33] (Emphases supplied)

Petitioners make much ado about the absence of a written agreement to prove their availment of
respondents irrigation services. They enthuse that absent any agreement and sans proof that they are
beneficiaries of the irrigation facility, no payment can be exacted from them. On record is a demand letter dated
11 January 1994 of Romeo R. Anonuevo, Provincial Irrigation Officer of the National Irrigation Administration
of Region IV, addressed to petitioner Olivia Palileo thru a certain Arsenio Bueta, whom petitioners admit as one
of the tillers of the land. Likewise on record are the respective statements of account for petitioners as of 31
August 1996, also signed by the Provincial Irrigation Officer of respondent. These documents would show the
irrigation consumption of petitioners lots as well as petitioners outstanding balance in irrigation fees. We accord
weight to these documents signed by the Provincial Irrigation Officer applying the presumption that official acts
or functions were regularly done. In the absence of clear and convincing evidence to the contrary,
the presumption of regularity of official acts by government officials must necessarily prevail.[34] Indeed, not
only is the award of payment of irrigation fees based on the law governing the NIA, it is likewise based on the
equitable postulate that having benefited from the services provided by respondent, it is unjust for petitioners to
retain benefit without paying for it.[35] All given, the findings and conclusions of the Court of Appeals are in
rhyme with the facts and the law and there are no compelling reasons for this Court to depart from the Court of
Appeals verdict. WHEREFORE, the present petition is hereby DENIED. Accordingly, the Decision and the
Resolution dated 10 April 2001 and 15 June 2001, of the Court of Appeals in CA-G.R CV No. 62854, are
hereby AFFIRMED. Costs against petitioners.

SO ORDERED.

33
 S E C O N D D I V I S I O N
LOURDES DE LA PAZ MASIKIP, G.R. No. 136349

Petitioner,

Present:

- versus - PUNO, J., Chairman,

THE CITY OF PASIG, HON. SANDOVAL-GUTIERREZ,

MARIETTA A. LEGASPI, in her
capacity as Presiding Judge of the CORONA,
Regional Trial Court of Pasig City, AZCUNA, and
Branch 165 and THE COURT OF
APPEALS, GARCIA, JJ.

Respondents. Promulgated:

January 23, 2006

x-----------------------------------------------------------------------------------------x

DECISION
SANDOVAL GUTIERREZ, J.:

Where the taking by the State of private property is done for the benefit of a small community which seeks to
have its own sports and recreational facility, notwithstanding that there is such a recreational facility only a
short distance away, such taking cannot be considered to be for public use. Its expropriation is not valid. In this
case, the Court defines what constitutes a genuine necessity for public use.

This petition for review on certiorari assails the Decision[1] of the Court of Appeals dated October 31, 1997 in
CA-G.R. SP No. 41860 affirming the Order [2] of the Regional Trial Court, Branch 165, Pasig City, dated May 7,
1996 in S.C.A. No. 873. Likewise assailed is the Resolution [3] of the same court dated November 20, 1998
denying petitioners Motion for Reconsideration.

The facts of the case are:

Petitioner Lourdes Dela Paz Masikip is the registered owner of a parcel of land with an area of 4,521 square
meters located at Pag-Asa, Caniogan, Pasig City, Metro Manila.

In a letter dated January 6, 1994, the then Municipality of Pasig, now City of Pasig, respondent, notified
petitioner of its intention to expropriate a 1,500 square meter portion of her property to be used for the sports
development and recreational activities of the residents of Barangay Caniogan. This was pursuant to Ordinance
No. 42, Series of 1993 enacted by the then Sangguniang Bayan of Pasig.

Again, on March 23, 1994, respondent wrote another letter to petitioner, but this time the purpose was allegedly
in line with the program of the Municipal Government to provide land opportunities to deserving poor sectors
of our community.

On May 2, 1994, petitioner sent a reply to respondent stating that the intended expropriation of her property is
unconstitutional, invalid, and oppressive, as the area of her lot is neither sufficient nor suitable to provide land
opportunities to deserving poor sectors of our community.

In its letter of December 20, 1994, respondent reiterated that the purpose of the expropriation of petitioners
property is to provide sports and recreational facilities to its poor residents.

Subsequently, on February 21, 1995, respondent filed with the trial court a complaint for expropriation,
docketed as SCA No. 873. Respondent prayed that the trial court, after due notice and hearing, issue an order

34
for the condemnation of the property; that commissioners be appointed for the purpose of determining the just
compensation; and that judgment be rendered based on the report of the commissioners.

On April 25, 1995, petitioner filed a Motion to Dismiss the complaint on the following grounds:

I
PLAINTIFF HAS NO CAUSE OF ACTION FOR THE EXERCISE OF THE POWER
OF EMINENT DOMAIN, CONSIDERING THAT:

(A) THERE IS NO GENUINE NECESSITY FOR THE TAKING OF

THE PROPERTY SOUGHT TO BE EXPROPRIATED.

(B) PLAINTIFF HAS ARBITRARILY AND CAPRICIOUSLY CHOSEN

THE PROPERTY SOUGHT TO BE EXPROPRIATED.

(C) EVEN ASSUMING ARGUENDO THAT DEFENDANTS

PROPERTY MAY BE EXPROPRIATED BY PLAINTIFF, THE FAIR
MARKET VALUE OF THE PROPERTY TO BE EXPROPRIATED FAR
EXCEEDS SEVENTY-EIGHT THOUSAND PESOS (P78,000.00)

II

PLAINTIFFS COMPLAINT IS DEFECTIVE IN FORM AND SUBSTANCE,

CONSIDERING THAT:

(A) PLAINTIFF FAILS TO ALLEGE WITH CERTAINTY THE

PURPOSE OF THE EXPROPRIATION.

(B) PLAINTIFF HAS FAILED TO COMPLY WITH THE

PREREQUISITES LAID DOWN IN SECTION 34, RULE VI OF THE
RULES AND REGULATIONS IMPLEMENTING THE LOCAL
GOVERNMENT CODE; THUS, THE INSTANT EXPROPRIATION
PROCEEDING IS PREMATURE.

III

THE GRANTING OF THE EXPROPRIATION WOULD VIOLATE SECTION 261 (V)

OF THE OMNIBUS ELECTION CODE.

IV

PLAINTIFF CANNOT TAKE POSSESSION OF THE SUBJECT PROPERTY BY

MERELY DEPOSITING AN AMOUNT EQUAL TO FIFTEEN PERCENT (15%) OF
THE VALUE OF THE PROPERTY BASED ON THE CURRENT TAX
DECLARATION OF THE SUBJECT PROPERTY.[4]

On May 7, 1996, the trial court issued an Order denying the Motion to Dismiss, [5] on the ground that there is a
genuine necessity to expropriate the property for the sports and recreational activities of the residents of
Pasig. As to the issue of just compensation, the trial court held that the same is to be determined in accordance
with the Revised Rules of Court.

Petitioner filed a motion for reconsideration but it was denied by the trial court in its Order of July 31, 1996.
Forthwith, it appointed the City Assessor and City Treasurer of Pasig City as commissioners to ascertain the just
compensation. This prompted petitioner to file with the Court of Appeals a special civil action for certiorari,
docketed as CA-G.R. SP No. 41860. On October 31, 1997, the Appellate Court dismissed the petition for lack
of merit. Petitioners Motion for Reconsideration was denied in a Resolution dated November 20, 1998.

Hence, this petition anchored on the following grounds:

35
 THE QUESTIONED DECISION DATED 31 OCTOBER 1997 (ATTACHMENT A)
AND RESOLUTION DATED 20 NOVEMBER 1998 (ATTACHMENT B) ARE
CONTRARY TO LAW, THE RULES OF COURT AND JURISPRUDENCE
CONSIDERING THAT:

A. THERE IS NO EVIDENCE TO PROVE THAT THERE IS GENUINE NECESSITY

FOR THE TAKING OF THE PETITIONERS PROPERTY.

B. THERE IS NO EVIDENCE TO PROVE THAT THE PUBLIC USE

REQUIREMENT FOR THE EXERCISE OF THE POWER OF
EMINENT DOMAIN HAS BEEN COMPLIED WITH.

C. THERE IS NO EVIDENCE TO PROVE THAT RESPONDENT CITY

OF PASIG HAS COMPLIED WITH ALL CONDITIONS
PRECEDENT FOR THE EXERCISE OF THE POWER OF
EMINENT DOMAIN.

THE COURT A QUOS ORDER DATED 07 MAY 1996 AND 31 JULY 1996, WHICH
WERE AFFIRMED BY THE COURT OF APPEALS, EFFECTIVELY AMOUNT TO
THE TAKING OF PETITIONERS PROPERTY WITHOUT DUE PROCESS OF LAW:

II

THE COURT OF APPEALS GRAVELY ERRED IN APPLYING OF

RULE ON ACTIONABLE DOCUMENTS TO THE DOCUMENTS
ATTACHED TO RESPONDENT CITY OF
PASIGS COMPLAINTDATED 07 APRIL 1995 TO JUSTIFY THE
COURT A QUOS DENIAL OF PETITIONERS RESPONSIVE
PLEADING TO THE COMPLAINT FOR EXPROPRIATION (THE
MOTION TO DISMISS DATED 21 APRIL 1995).

III

THE COURT OF APPEALS GRAVELY ERRED IN APPLYING THE

RULE ON HYPOTHETICAL ADMISSION OF FACTS ALLEGED IN A
COMPLAINT CONSIDERING THAT THE MOTION TO
DISMISS FILED BY PETITIONER IN THE EXPROPRIATION CASE
BELOW WAS THE RESPONSIVE PLEADING REQUIRED TO BE
FILED UNDER THE THEN RULE 67 OF THE RULES OF COURT
AND NOT AN ORIDNARY MOTION TO DISMISS UNDER RULE 16
OF THE RULES OF COURT.

The foregoing arguments may be synthesized into two main issues one substantive and one procedural. We will
first address the procedural issue.

Petitioner filed her Motion to Dismiss the complaint for expropriation on April 25, 1995. It was denied by the
trial court on May 7, 1996. At that time, the rule on expropriation was governed by Section 3, Rule 67 of the
Revised Rules of Court which provides:
SEC. 3. Defenses and objections. Within the time specified in the summons, each defendant, in
lieu of an answer, shall present in a single motion to dismiss or for other appropriate relief, all his
objections and defenses to the right of the plaintiff to take his property for the use or purpose
specified in the complaint. All such objections and defenses not so presented are waived. A copy

36
 of the motion shall be served on the plaintiffs attorney of record and filed with the court with
proof of service.

The motion to dismiss contemplated in the above Rule clearly constitutes the responsive pleading which takes
the place of an answer to the complaint for expropriation. Such motion is the pleading that puts in issue the right
of the plaintiff to expropriate the defendants property for the use specified in the complaint. All that the law
requires is that a copy of the said motion be served on plaintiffs attorney of record. It is the court that at its
convenience will set the case for trial after the filing of the said pleading.[6]

The Court of Appeals therefore erred in holding that the motion to dismiss filed by petitioner hypothetically
admitted the truth of the facts alleged in the complaint, specifically that there is a genuine necessity to
expropriate petitioners property for public use. Pursuant to the above Rule, the motion is a responsive pleading
joining the issues. What the trial court should have done was to set the case for the reception of evidence to
determine whether there is indeed a genuine necessity for the taking of the property, instead of summarily
making a finding that the taking is for public use and appointing commissioners to fix just compensation. This is
especially so considering that the purpose of the expropriation was squarely challenged and put in issue by
petitioner in her motion to dismiss.

Significantly, the above Rule allowing a defendant in an expropriation case to file a motion to dismiss in lieu of
an answer was amended by the 1997 Rules of Civil Procedure, which took effect on July 1, 1997. Section 3,
Rule 67 now expressly mandates that any objection or defense to the taking of the property of a defendant must
be set forth in an answer.

The fact that the Court of Appeals rendered its Decision in CA-G.R. SP No. 41860 on October 31, after the
1997 Rules of Civil Procedure took effect, is of no moment. It is only fair that the Rule at the time petitioner
filed her motion to dismiss should govern. The new provision cannot be applied retroactively to her prejudice.

We now proceed to address the substantive issue.

In the early case of US v. Toribio,[7] this Court defined the power of eminent domain as the right of a
government to take and appropriate private property to public use, whenever the public exigency requires it,
which can be done only on condition of providing a reasonable compensation therefor. It has also been
described as the power of the State or its instrumentalities to take private property for public use and is
inseparable from sovereignty and inherent in government.[8]

The power of eminent domain is lodged in the legislative branch of the government. It delegates the exercise
thereof to local government units, other public entities and public utility corporations, [9] subject only to
Constitutional limitations. Local governments have no inherent power of eminent domain and may exercise it
only when expressly authorized by statute.[10] Section 19 of the Local Government Code of 1991 (Republic Act
No. 7160) prescribes the delegation by Congress of the power of eminent domain to local government units and
lays down the parameters for its exercise, thus:
SEC. 19. Eminent Domain. A local government unit may, through its chief executive and acting
pursuant to an ordinance, exercise the power of eminent domain for public use, purpose or
welfare for the benefit of the poor and the landless, upon payment of just compensation, pursuant
to the provisions of the Constitution and pertinent laws: Provided, however, That, the power of
eminent domain may not be exercised unless a valid and definite offer has been previously made
to the owner and such offer was not accepted: Provided, further, That, the local government unit
may immediately take possession of the property upon the filing of expropriation proceedings
and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair
market value of the property based on the current tax declaration of the property to be
expropriated: Provided, finally, That, the amount to be paid for expropriated property shall be
determined by the proper court, based on the fair market value at the time of the taking of the
property.

37
Judicial review of the exercise of eminent domain is limited to the following areas of concern: (a) the adequacy
of the compensation, (b) the necessity of the taking, and (c) the public use character of the purpose of the
taking.[11]

In this case, petitioner contends that respondent City of Pasig failed to establish a genuine necessity which
justifies the condemnation of her property. While she does not dispute the intended public purpose, nonetheless,
she insists that there must be a genuine necessity for the proposed use and purposes. According to petitioner,
there is already an established sports development and recreational activity center at Rainforest Park in Pasig
City, fully operational and being utilized by its residents, including those from Barangay Caniogan. Respondent
does not dispute this. Evidently, there is no genuine necessity to justify the expropriation.

The right to take private property for public purposes necessarily originates from the necessity and the taking
must be limited to such necessity. In City of Manila v. Chinese Community of Manila,[12] we held that the very
foundation of the right to exercise eminent domain is a genuine necessity and that necessity must be of a
public character. Moreover, the ascertainment of the necessity must precede or accompany and not follow, the
taking of the land. In City of Manila v. Arellano Law College,[13] we ruled that necessity within the rule that the
particular property to be expropriated must be necessary, does not mean an absolute but only a reasonable or
practical necessity, such as would combine the greatest benefit to the public with the least inconvenience and
expense to the condemning party and the property owner consistent with such benefit.

Applying this standard, we hold that respondent City of Pasig has failed to establish that there is a
genuine necessity to expropriate petitioners property. Our scrutiny of the records shows that the
Certification[14] issued by the Caniogan Barangay Council dated November 20, 1994, the basis for the passage
of Ordinance No. 42 s. 1993 authorizing the expropriation, indicates that the intended beneficiary is the
Melendres Compound Homeowners Association, a private, non-profit organization, not the residents of
Caniogan. It can be gleaned that the members of the said Association are desirous of having their own private
playground and recreational facility. Petitioners lot is the nearest vacant space available. The purpose is,
therefore, not clearly and categorically public. The necessity has not been shown, especially considering that
there exists an alternative facility for sports development and community recreation in the area, which is the
Rainforest Park, available to all residents of Pasig City, including those of Caniogan.

The right to own and possess property is one of the most cherished rights of men. It is so fundamental
that it has been written into organic law of every nation where the rule of law prevails. Unless the requisite of
genuine necessity for the expropriation of ones property is clearly established, it shall be the duty of the courts
to protect the rights of individuals to their private property. Important as the power of eminent domain may be,
the inviolable sanctity which the Constitution attaches to the property of the individual requires not only that the
purpose for the taking of private property be specified. The genuine necessity for the taking, which must be of a
public character, must also be shown to exist.

WHEREFORE, the petition for review is GRANTED. The challenged Decision and Resolution of the
Court of Appeals in CA-G.R. SP No. 41860 are REVERSED. The complaint for expropriation filed before the
trial court by respondent City of Pasig, docketed as SCA No. 873, is ordered DISMISSED.

SO ORDERED.

38
 FIRST DIVISION
AMOS P. FRANCIA, JR., G.R. No. 170432

CECILIA P. FRANCIA,

AND HEIRS OF BENJAMIN

P. FRANCIA, Present:

Petitioners,

PUNO, C.J., Chairperson,

CARPIO,

CORONA,

AZCUNA and

- v e r s u s - LEONARDO-DE CASTRO, JJ.

MUNICIPALITY OF
MEYCAUAYAN,
Respondent. Promulgated: March 24, 2008

RE S O LUTI ON

CORONA, J.:

On February 6, 2003, respondent Municipality of Meycauayan, Bulacan filed a complaint for

expropriation[1] against petitioners Amos P. Francia, Jr., Cecilia P. Francia and Benjamin P. Francia [2] in the

Regional Trial Court (RTC) of Malolos, Bulacan, Branch 16. Respondent needed petitioners' 16,256 sq. m. idle

property at the junction of the North Expressway, Malhacan-Iba-Camalig main road artery and the MacArthur

Highway.[3] It planned to use it to establish a common public terminal for all types of public utility vehicles with

a weighing scale for heavy trucks.

In their answer,[4] petitioners denied that the property sought to be expropriated was raw land. It was in fact

developed[5] and there were plans for further development. For this reason, respondents offer price

of P2,333,500 (or P111.99 per square meter) was too low.

After trial, the RTC ruled that the expropriation was for a public purpose. The construction of a common
terminal for all public utility conveyances (serving as a two-way loading and unloading point for commuters
and goods) would improve the flow of vehicular traffic during rush hours. Moreover, the property was the best
site for the proposed terminal because of its accessibility. Thus, on November 8, 2004, the RTC issued the
following order:[6]

WHEREFORE, premises considered, after [respondent] has deposited with this Court the
fifteen percent (15%) of the fair market value of the property based on the current tax
declaration of the property to be expropriated, it may take immediate possession of the property
upon issuance of writ of possession that this court will issue for that purpose.

39
 Further, the purposes of assessment and determination of the area needed that will suit the
purpose of expropriation and just compensation of the lot sought to be expropriated, the court
hereby appoints commissioners to be composed of the officer-in-charge of this court, Lerida
Socorro E. Joson and one each from [respondent] and [petitioners].

Notify all parties concerned.

SO ORDERED.[7]

Petitioners moved for the reconsideration of the November 8, 2004 order but the motion was denied in an order

dated January 31, 2005.

Aggrieved, petitioners filed a petition for certiorari in the Court of Appeals (CA) contending that the RTC

committed grave abuse of discretion in issuing its November 8, 2004 and January 31, 2005 orders. They

claimed that the trial court issued the orders without conducting a hearing to determine the existence of a public

purpose.

On July 28, 2005, the CA rendered a decision[8] partially granting the petition. Finding that petitioners were

deprived of an opportunity to controvert respondent's allegations, the appellate court nullified the order of

expropriation except with regard to the writ of possession. According to the CA, a hearing was not necessary

because once the expropriator deposited the required amount (with the Court), the issuance of a writ of

possession became ministerial.

Petitioners moved for partial reconsideration but their motion was denied. Hence, this recourse.

Petitioners essentially aver that the CA erred in upholding the RTC's orders that, in expropriation cases, prior

determination of the existence of a public purpose was not necessary for the issuance of a writ of possession.

We deny the petition.

Section 19 of Republic Act 7160[9] provides:

Section 19. Eminent Domain. A local government unit may, through its chief executive and
acting pursuant to an ordinance, exercise the power of eminent domain for public use, or
purpose, or welfare for the benefit of the poor and the landless, upon payment of just
compensation, pursuant to the provisions of the Constitution and pertinent laws; Provided,
however, That the power of eminent domain may not be exercised unless a valid and definite
offer has been previously made to the owner, and that such offer was not accepted; Provided,
further, That the local government unit may immediately take possession of the property
upon the filing of the expropriation proceedings and upon making a deposit with the
proper court of at least fifteen percent (15%) of the fair market value of the property
based on the current tax declaration of the property to be expropriated; Provided,
finally, That, the amount to be paid for the expropriated property shall be determined by the
proper court, based on the fair market value at the time of the taking of the property. (emphasis
supplied)[10]

40
Before a local government unit may enter into the possession of the property sought to be expropriated, it must

(1) file a complaint for expropriation sufficient in form and substance in the proper court and (2) deposit with

the said court at least 15% of the property's fair market value based on its current tax declaration. [11] The law

does not make the determination of a public purpose a condition precedent to the issuance of a writ of

possession.[12]
WHEREFORE, the petition is hereby DENIED.

Costs against petitioners.

SO ORDERED.

41
 THIRD DIVISION
SPOUSES CIRIACO and G.R. No. 181562-63
ARMINDA ORTEGA,
Petitioners,

- versus -

CITY OF CEBU,
Respondent.
x----------------------------x
CITY OF CEBU, G.R. No. 181583-84
Petitioner,
Present:

YNARES-SANTIAGO, J.,
Chairperson,
- versus - CHICO-NAZARIO,
VELASCO, JR.,
NACHURA, and
PERALTA, JJ.

SPOUSES CIRIACO and Promulgated:

ARMINDA ORTEGA,
Respondents. October 2, 2009

x------------------------------------------------------------------------------------x

DECISION
NACHURA, J.:

These are consolidated petitions for review on certiorari filed by petitioners Ciriaco and Arminda Ortega
(Spouses Ortega) in G.R. Nos. 181562-63 and petitioner City of Cebu (Cebu City) in G.R. Nos. 181583-84
assailing the Decision of the Court of Appeals (CA) in the similarly consolidated petitions docketed as CA-G.R.
SP No. 80187 and CA-G.R. SP No. 00147, respectively.[1]
The facts, summarized by the CA, follow.

Spouses Ciriaco and Arminda Ortega x x x are the registered owners of a parcel of land known as
Lot No. 310-B, situated in Hipodromo, Cebu City, with an area of 5,712 square meters and
covered by Transfer Certificate of Title No. 113311, issued by the Register of Deeds of the City
of Cebu.

One-half of the above described land is occupied by squatters. On September 24, 1990, [the
Spouses Ortega] filed an ejectment case against the squatters before the Municipal Trial Court in
Cities (MTCC) of Cebu City, which rendered decision in favor of [the spouses Ortega]. The case
eventually reached the Supreme Court, which affirmed the decision of the MTCC. The decision
of the MTCC became final and executory, and a writ of execution was issued on February 1,
1994.

42
On May 23, 1994, the Sangguniang Panglungsod of [Cebu City] enacted City Ordinance No.
1519, giving authority to the City Mayor to expropriate one-half (1/2) portion (2,856 square
meters) of [the spouses Ortegas] land (which is occupied by the squatters), and appropriating for
that purpose the amount of P3,284,400.00 or at the price of ONE THOUSAND ONE
HUNDRED FIFTY PESOS (P1,150.00) per square meter. The amount will be charged against
Account No. 8-93-310, Continuing Appropriation, Account No. 101-8918-334, repurchase of lots
for various projects. The value of the land was determined by the Cebu City Appraisal
Committee in Resolution No. 19, series of 1994, dated April 15, 1994.

Pursuant to said ordinance, [Cebu City] filed a Complaint for Eminent Domain [before the
Regional Trial Court (RTC), Branch 23, Cebu City] against [the spouses Ortega], docketed as
Civil Case No. CEB-16577.

On March 13, 1998, the [RTC] issued an order declaring that [Cebu City] has the lawful right to
take the property subject of the instant case, for public use or purpose described in the complaint
upon payment of just compensation.

Based on the recommendation of the appointed Commissioners (one of whom was the City
Assessor of [Cebu City], the [RTC] issued another Order dated May 21, 1999, fixing the value of
the land subject to expropriation at ELEVEN THOUSAND PESOS (P11,000.00) per square
meter and ordering [Cebu City] to pay [Spouses Ortega] the sum of THIRTY ONE MILLION
AND FOUR HUNDRED SIXTEEN THOUSAND PESOS (P31,416,000.00) as just
compensation for the expropriated portion of Lot No. 310-B.

The Decision of the [RTC] became final and executory because of [Cebu Citys] failure to
perfect an appeal on time, and a Writ of Execution was issued on September 17, 1999 to enforce
the courts judgment. Upon motion of [the Spouses Ortega], the [RTC] issued an Order dated
March 11, 2002, quoted as follows:

Reading of the aforestated resolution shows that the City Council of Cebu
approved Ordinance No. 1519 appropriating the sum of P3,284,400.00 for
payment of the subject lot chargeable to Account No. 101-8918-334.

In view thereof, the above-mentioned sum is now subject for execution or

garnishment for the same is no longer exempt from execution.

[Cebu City] filed an Omnibus Motion to Stay Execution, Modification of Judgment and
Withdrawal of the Case, contending that the price set by the [RTC] as just compensation to be
paid to [the Spouses Ortega] is way beyond the reach of its intended beneficiaries for its
socialized housing program. The motion was denied by the [RTC]. [Cebu Citys] Motion for
Reconsideration was likewise denied.

By virtue of the Order of the [RTC], dated July 2, 2003, x x x Sheriff Benigno B. Reas[,] Jr.
served a Notice of Garnishment to Philippine Postal Bank, P. del Rosario
and Junquera Branch Cebu City, garnishing [Cebu Citys] bank deposit therein.

Hence, [Cebu City] filed the instant Petition for Certiorari before [the CA] (CA-G.R. SP NO.
80187).

During the pendency of x x x CA-G.R. SP NO. 80187, [Cebu City] filed before the [RTC] a
Motion to Dissolve, Quash or Recall the Writ of Garnishment, contending that Account No. 101-
8918-334 mentioned in Ordinance No. 1519 is not actually an existing bank account and that the
43
 garnishment of [Cebu Citys] bank account with Philippine Postal Bank was illegal, because
government funds and properties may not be seized under writ of execution or garnishment to
satisfy such judgment, on obvious reason of public policy. The [RTC] issued an Order
dated March 8, 2004, denying said motion. [Cebu Citys] Motion for Reconsideration was also
denied.

[The Spouses Ortega] filed an Ex-Parte Motion to Direct the New Manager of Philippine Postal
Bank to Release to the Sheriff the Garnished Amount, which was granted by the [RTC].
[Cebu City] filed a Motion for Reconsideration, but the same was denied.

Hence, [Cebu City] filed another Petition for Certiorari (CA-G.R. SP NO. 00147) [with the
Court of Appeals].[2]
Ruling on the petitions for certiorari, the CA disposed of the cases, to wit:

WHEREFORE, all the foregoing premises considered, the instant Petitions for Certiorari are
hereby PARTIALLY GRANTED. The assailed Orders of the [RTC] [Assailed Orders dated
March 11, 2002 and July 2, 2003, respectively, in CA-G.R SP NO. 80187] are hereby
ANNULLED AND SET ASIDE insofar as they denied [Cebu Citys] Motion to Stay Execution,
but they are hereby AFFIRMED insofar as they denied [Cebu Citys] Motion to Modify Judgment
and Withdraw from the Expropriation Proceedings. Furthermore, the assailed Orders of the [RTC
dated March 8, 2004 in CA-G.R. SP NO. 00147] are hereby ANNULLED AND SET ASIDE. Let
the Decision of the [RTC] be executed in a manner prescribed by applicable law and
jurisprudence.

SO ORDERED.[3]
Hence, these consolidated appeals by petitioners Cebu City and the Spouses Ortega positing the following
issues:

1. Whether the CA erred in affirming the RTCs denial of Cebu Citys Omnibus Motion to Modify Judgment and
to be Allowed to Withdraw from the Expropriation Proceedings.

2. Whether the deposit of Cebu City with the Philippine Postal Bank, appropriated for a different purpose by its
Sangguniang Panglungsod, can be subject to garnishment as payment for the expropriated lot covered by City
Ordinance No. 1519.

We deny both petitions.

On the first issue, the CA did not err in affirming the RTCs Order that the expropriation case had long been final
and executory. Consequently, both the Order of expropriation and the Order fixing just compensation by the
RTC can no longer be modified. In short, CebuCity cannot withdraw from the expropriation proceedings.
Section 4, Rule 67 of the Rules of Court on Expropriation provides:

SEC. 4. Order of expropriation. If the objections to and the defenses against the right of the
plaintiff to expropriate the property are overruled, or when no party appears to defend as required
by this Rule, the court may issue an order of expropriation declaring that the plaintiff has a
lawful right to take the property sought to be expropriated, for the public use or purpose
described in the complaint, upon the payment of just compensation to be determined as of the
date of the taking of the property or the filing of the complaint, whichever came first.

44
 A final order sustaining the right to expropriate the property may be appealed by any party
aggrieved thereby. Such appeal, however, shall not prevent the court from determining the just
compensation to be paid.

After the rendition of such an order, the plaintiff shall not be permitted to dismiss or discontinue
the proceeding except on such terms as the court deems just and equitable.

Plainly, from the aforequoted provision, expropriation proceedings speak of two (2) stages, i.e.:

1. Determination of the authority of the plaintiff to exercise the power of eminent domain and the
propriety of its exercise in the context of the facts involved in the suit. This ends with an order, if
not of dismissal of the action, of condemnation [or order of expropriation] declaring that the
plaintiff has the lawful right to take the property sought to be condemned, for the public use or
purpose described in the complaint, upon the payment of just compensation to be determined as
of the date of the filing of the complaint; and

2. Determination by the court of the just compensation for the property sought to be taken.[4]
We held in the recent case of Republic v. Phil-Ville Development and Housing Corporation[5] that:

[A]n order of expropriation denotes the end of the first stage of expropriation. Its end then paves
the way for the second stagethe determination of just compensation, and, ultimately,
payment. An order of expropriation puts an end to any ambiguity regarding the right of the
petitioner to condemn the respondents properties. Because an order of expropriation merely
determines the authority to exercise the power of eminent domain and the propriety of such
exercise, its issuance does not hinge on the payment of just compensation. After all, there
would be no point in determining just compensation if, in the first place, the plaintiffs right
to expropriate the property was not first clearly established.[6]
Conversely, as is evident from the foregoing, an order by the trial court fixing just compensation does
not affect a prior order of expropriation. As applied to the case at bar, Cebu City can no longer ask for
modification of the judgment, much less, withdraw its complaint, after it failed to appeal even the first stage of
the expropriation proceedings.

Cebu City is adamant, however, that it should be allowed to withdraw its complaint as the just
compensation fixed by the RTC is too high, and the intended expropriation of the Spouses Ortegas property is
dependent on whether Cebu City would have sufficient funds to pay for the same.

We cannot subscribe to Cebu Citys ridiculous contention.

It is well-settled in jurisprudence that the determination of just compensation is a judicial prerogative.
[7]
In Export Processing Zone Authority v. Dulay,[8] we declared:

The determination of just compensation in eminent domain cases is a judicial function. The
executive department or the legislature may make the initial determinations but when a party
claims a violation of the guarantee in the Bill of Rights that private property may not be taken for
public use without just compensation, no statute, decree, or executive order can mandate that its
own determination shall prevail over the courts findings. Much less can the courts be precluded
from looking into the just-ness of the decreed compensation.

45
 We, therefore, hold that P.D. No. 1533, which eliminates the courts discretion to appoint
commissioners pursuant to Rule 67 of the Rules of Court, is unconstitutional and void. To hold
otherwise would be to undermine the very purpose why this Court exists in the first place.
Likewise, in the recent cases of National Power Corporation v. dela Cruz [9] and Forfom Development
Corporation v. Philippine National Railways,[10] we emphasized the primacy of judicial prerogative in the
ascertainment of just compensation as aided by the appointed commissioners, to wit:
Though the ascertainment of just compensation is a judicial prerogative, the appointment
of commissioners to ascertain just compensation for the property sought to be taken is
a mandatory requirement in expropriation cases. While it is true that the findings
of commissioners may be disregarded and the trial court may substitute its own estimate of the
value, it may only do so for valid reasons; that is, where the commissioners have applied illegal
principles to the evidence submitted to them, where they have disregarded a clear preponderance
of evidence, or where the amount allowed is either grossly inadequate or excessive. Thus, trial
with the aid of the commissioners is a substantial right that may not be done away with
capriciously or for no reason at all.
As regards the second issue raised by the Spouses Ortega, we quote with favor the CAs disquisition thereon, to
wit:
While the claim of [the Spouses Ortega] against [Cebu City] is valid, the [RTC] cannot, by itself,
order the City Council of [Cebu City] to enact an appropriation ordinance in order to satisfy its
judgment.

The proper remedy of [the Spouses Ortega] is to file a mandamus case against [Cebu City] in
order to compel its Sangguniang Panglungsod to enact an appropriation ordinance for the
satisfaction of [the Spouses Ortegas] claim. This remedy is provided in the case of Municipality
of Makati v. Court of Appeals, which provides:

Nevertheless, this is not to say that private respondent and PSB are left with no
legal recourse. Where a municipality fails or refuses, without justifiable reason[s],
to effect payment of a final money judgment rendered against it, the claimant may
avail of the remedy of mandamus in order to compel the enactment and approval
of the necessary appropriation ordinance, and the corresponding disbursement of
municipal funds therefor. x x x.
xxxx

The Sangguniang Panglungsod of [Cebu City] enacted Ordinance No. 1519, appropriating the
sum of P3,284,400.00 for payment of just compensation for the expropriated land, chargeable to
Account No. 101-8918-334.

Pursuant to such ordinance, the [RTC] issued an order dated March 11, 2002, which was the
basis for the issuance of the Writ of Garnishment, garnishing [Cebu Citys] bank account with
Philippine Postal Bank.

However, Philippine Postal Bank issued a Certification dated February 7, 2005, certifying that
Account No. 8-93-310 (Continuing Account) and Account No. 101-8918-334 intended for
purchase of lot for various projects are not bank account numbers with Philippine Postal Bank.

It is a settled rule that government funds and properties may not be seized under writs of
execution or garnishment to satisfy judgments, based on obvious consideration of public policy.
Disbursements of public funds must be covered by the corresponding appropriation as required
by law. The functions and public services rendered by the State cannot be allowed to be

46
 paralyzed or disrupted by the diversion of public funds from their legitimate and specific objects,
as appropriated by law.

In Municipality of Makati v. Court of Appeals, x x x where the Municipality of Makati enacted an

ordinance appropriating certain sum of money as payment for the land the municipality
expropriated, chargeable to Account No. S/A 265-537154-3 deposited in PNB Buendia Branch,
the Supreme Court held that the trial court has no authority to garnish the Municipalitys other
bank account (Account No. S/A 263-530850-7) in order to cover the deficiency in Account No.
S/A 265-537154-3, even if both accounts are in the same branch of the PNB. In said case, the
Supreme Court held:

Absent any showing that the municipal council of Makati has passed an ordinance
appropriating from its public funds an amount corresponding to the balance due
under the RTC decision dated June 4, 1987, less the sum of P99,743.94 deposited
in Account No. S/A 265-537154-3, no levy under execution may be validly
effected on the public funds of petitioner deposited in Account No. S/A 263-
530850-7.

The foregoing rules find application in the case at bar. While the Sangguniang Panglungsod of
petitioner enacted Ordinance No. 1519 appropriating the sum of P3,284,400.00 for payment of
just compensation for the expropriated land, such ordinance cannot be considered as a source of
authority for the [RTC] to garnish [Cebu Citys] bank account with Philippine Postal Bank, which
was already appropriated for another purpose. [Cebu Citys] account with Philippine Postal Bank
was not specifically opened for the payment of just compensation nor was it specifically
appropriated by Ordinance No. 1519 for such purpose. Said account, therefore, is exempt from
garnishment.

Since the [RTC] has no authority to garnish [Cebu Citys] other bank accounts in order to satisfy
its judgment, consequently, it has no authority to order the release of [Cebu Citys] other deposits
with Philippine Postal Bank x x x.[11]

Even assuming that Cebu City Ordinance No. 1519 actually appropriated the amount of P3,284,400.00 for
payment of just compensation thus, within the reach of a writ of garnishment issued by the trial court [12]
there remains the inescapable fact that the Philippine Postal Bank account referred to in the ordinance does not
actually exist, as certified to by the Bank. Accordingly, no writ of garnishment may be validly issued against
such non-existent account with Philippine Postal Bank. This circumstance translates to a situation where there is
no valid appropriation ordinance.

WHEREFORE, the petitions in G.R. Nos. 181562-63 and 181583-84 are hereby DENIED. The Decision of
the Court of Appeals in CA-G.R. SP Nos. 80187 and 00147 is AFFIRMED. No pronouncement as to costs.
SO ORDERED.

47
 FIRST DIVISION
[G.R. No. 127820. July 20, 1998]
MUNICIPALITY OF PARAAQUE, petitioner, vs. V.M. REALTY CORPORATION, respondent.
DECISION
PANGANIBAN, J.:

A local government unit (LGU), like the Municipality of Paraaque, cannot authorize an expropriation of private
property through a mere resolution of its lawmaking body. The Local Government Code expressly and clearly
requires an ordinance or a local law for the purpose. A resolution that merely expresses the sentiment or opinion
of the Municipal Council will not suffice. On the other hand, the principle of res judicata does not bar
subsequent proceedings for the expropriation of the same property when all the legal requirements for its valid
exercise are complied with.

Statement of the Case

These principles are applied by this Court in resolving this petition for review on certiorari of the July 22,
1996 Decision[1] of the Court of Appeals[2]in CA GR CV No. 48048, which affirmed in toto[3] the Regional Trial
Courts August 9, 1994 Resolution.[4] The trial court dismissed the expropriation suit as follows:

The right of the plaintiff to exercise the power of eminent domain is not disputed. However, such right may be
exercised only pursuant to an Ordinance (Sec. 19, R.A. No. 7160). In the instant case, there is no such ordinance
passed by the Municipal Council of Paraaque enabling the Municipality, thru its Chief Executive, to exercise the
power of eminent domain. The complaint, therefore, states no cause of action.

Assuming that plaintiff has a cause of action, the same is barred by a prior judgment. On September 29, 1987,
the plaintiff filed a complaint for expropriation involving the same parcels of land which was docketed as Civil
Case No. 17939 of this Court (page 26, record). Said case was dismissed with prejudice on May 18, 1988 (page
39, record). The order of dismissal was not appealed, hence, the same became final. The plaintiff can not be
allowed to pursue the present action without violating the principle of [r]es [j]udicata. While defendant in Civil
Case No. 17939 was Limpan Investment Corporation, the doctrine of res judicata still applies because the
judgment in said case (C.C. No. 17939) is conclusive between the parties and their successors-in-interest (Vda.
de Buncio vs. Estate of the late Anita de Leon). The herein defendant is the successor-in-interest of Limpan
Investment Corporation as shown by the Deed of Assignment Exchange executed on June 13, 1990.

WHEREFORE, defendants motion for reconsideration is hereby granted. The order dated February 4, 1994 is
vacated and set aside.

This case is hereby dismissed. No pronouncement as to costs.

SO ORDERED.[5]

Factual Antecedents

Pursuant to Sangguniang Bayan Resolution No. 93-95, Series of 1993,[6] the Municipality of Paraaque filed
on September 20, 1993, a Complaint for expropriation [7] against Private Respondent V.M. Realty Corporation
over two parcels of land (Lots 2-A-2 and 2-B-1 of Subdivision Plan Psd-17917), with a combined area of about
10,000 square meters, located at Wakas, San Dionisio, Paraaque, Metro Manila, and covered by Torrens
Certificate of Title No. 48700. Allegedly, the complaint was filed for the purpose of alleviating the living
conditions of the underprivileged by providing homes for the homeless through a socialized housing project.
48
[8]
Parenthetically, it was also for this stated purpose that petitioner, pursuant to its Sangguniang
Bayan Resolution No. 577, Series of 1991,[9] previously made an offer to enter into a negotiated sale of the
property with private respondent, which the latter did not accept.[10]
Finding the Complaint sufficient in form and substance, the Regional Trial Court of Makati, Branch 134,
issued an Order dated January 10, 1994,[11] giving it due course. Acting on petitioners motion, said court issued
an Order dated February 4, 1994,[12] authorizing petitioner to take possession of the subject property upon
deposit with its clerk of court of an amount equivalent to 15 percent of its fair market value based on its current
tax declaration.
On February 21, 1994, private respondent filed its Answer containing affirmative defenses and a
counterclaim,[13] alleging in the main that (a) the complaint failed to state a cause of action because it was filed
pursuant to a resolution and not to an ordinance as required by RA 7160 (the Local Government Code); and (b)
the cause of action, if any, was barred by a prior judgment or res judicata. On private respondents motion, its
Answer was treated as a motion to dismiss.[14] On March 24, 1994,[15] petitioner filed its opposition, stressing
that the trial courts Order dated February 4, 1994 was in accord with Section 19 of RA 7160, and that the
principle of res judicata was not applicable.
Thereafter, the trial court issued its August 9, 1994 Resolution [16] nullifying its February 4, 1994 Order and
dismissing the case. Petitioners motions for reconsideration and transfer of venue were denied by the trial court
in a Resolution dated December 2, 1994.[17] Petitioner then appealed to Respondent Court, raising the following
issues:

1. Whether or not the Resolution of the Paraaque Municipal Council No. 93-95, Series of 1993 is a
substantial compliance of the statutory requirement of Section 19, R.A. 7180 [sic] in the exercise
of the power of eminent domain by the plaintiff-appellant.

2. Whether or not the complaint in this case states no cause of action.

3. Whether or not the strict adherence to the literal observance to the rule of procedure resulted in
technicality standing in the way of substantial justice.

4. Whether or not the principle of res judicata is applicable to the present case.[18]

As previously mentioned, the Court of Appeals affirmed in toto the trial courts Decision. Respondent Court,
in its assailed Resolution promulgated on January 8, 1997,[19] denied petitioners Motion for Reconsideration for
lack of merit.
Hence, this appeal.[20]

The Issues

Before this Court, petitioner posits two issues, viz.:

1. A resolution duly approved by the municipal council has the same force and effect of an ordinance and will
not deprive an expropriation case of a valid cause of action.

2. The principle of res judicata as a ground for dismissal of case is not applicable when public interest is
primarily involved.[21]

The Courts Ruling

The petition is not meritorious.

49
 First Issue:
Resolution Different from an Ordinance
Petitioner contends that a resolution approved by the municipal council for the purpose of initiating an
expropriation case substantially complies with the requirements of the law [22] because the terms ordinance and
resolution are synonymous for the purpose of bestowing authority [on] the local government unit through its
chief executive to initiate the expropriation proceedings in court in the exercise of the power of eminent
domain.[23]Petitioner seeks to bolster this contention by citing Article 36, Rule VI of the Rules and Regulations
Implementing the Local Government Code, which provides: If the LGU fails to acquire a private property for
public use, purpose, or welfare through purchase, the LGU may expropriate said property through
a resolution of the Sanggunian authorizing its chief executive to initiate expropriation proceedings.[24] (Italics
supplied.)
The Court disagrees. The power of eminent domain is lodged in the legislative branch of government,
which may delegate the exercise thereof to LGUs, other public entities and public utilities. [25] An LGU may
therefore exercise the power to expropriate private property only when authorized by Congress and subject to
the latters control and restraints, imposed through the law conferring the power or in other legislations. [26] In this
case, Section 19 of RA 7160, which delegates to LGUs the power of eminent domain, also lays down the
parameters for its exercise. It provides as follows:

Section 19. Eminent Domain. A local government unit may, through its chief executive and acting pursuant to
an ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for the benefit of the
poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and
pertinent laws: Provided, however, That the power of eminent domain may not be exercised unless a valid and
definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That
the local government unit may immediately take possession of the property upon the filing of the expropriation
proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market
value of the property based on the current tax declaration of the property to be expropriated:Provided, finally,
That, the amount to be paid for the expropriated property shall be determined by the proper court, based on the
fair market value at the time of the taking of the property. (Emphasis supplied)

Thus, the following essential requisites must concur before an LGU can exercise the power of eminent
domain:
1. An ordinance is enacted by the local legislative council authorizing the local chief executive, in
behalf of the LGU, to exercise the power of eminent domain or pursue expropriation proceedings
over a particular private property.
2. The power of eminent domain is exercised for public use, purpose or welfare, or for the benefit of
the poor and the landless.
3. There is payment of just compensation, as required under Section 9, Article III of the Constitution,
and other pertinent laws.
4. A valid and definite offer has been previously made to the owner of the property sought to be
expropriated, but said offer was not accepted.[27]
In the case at bar, the local chief executive sought to exercise the power of eminent domain pursuant to a
resolution of the municipal council.Thus, there was no compliance with the first requisite that the mayor be
authorized through an ordinance. Petitioner cites Camarines Sur vs. Court of Appeals [28] to show that a
resolution may suffice to support the exercise of eminent domain by an LGU. [29] This case, however, is not in
point because the applicable law at that time was BP 337, [30] the previous Local Government Code, which had
provided that a mere resolution would enable an LGU to exercise eminent domain. In contrast, RA 7160,[31] the
present Local Government Code which was already in force when the Complaint for expropriation was filed,
explicitly required an ordinance for this purpose.

50
 We are not convinced by petitioners insistence that the terms resolution and ordinance are synonymous. A
municipal ordinance is different from a resolution. An ordinance is a law, but a resolution is merely a
declaration of the sentiment or opinion of a lawmaking body on a specific matter. [32] An ordinance possesses a
general and permanent character, but a resolution is temporary in nature. Additionally, the two are enacted
differently -- a third reading is necessary for an ordinance, but not for a resolution, unless decided otherwise by
a majority of all the Sanggunian members.[33]
If Congress intended to allow LGUs to exercise eminent domain through a mere resolution, it would have
simply adopted the language of the previous Local Government Code. But Congress did not. In a clear
divergence from the previous Local Government Code, Section 19 of RA 7160 categorically requires that the
local chief executive act pursuant to an ordinance. Indeed, [l]egislative intent is determined principally from the
language of a statute. Where the language of a statute is clear and unambiguous, the law is applied according to
its express terms, and interpretation would be resorted to only where a literal interpretation would be either
impossible or absurd or would lead to an injustice. [34] In the instant case, there is no reason to depart from this
rule, since the law requiring an ordinance is not at all impossible, absurd, or unjust.
Moreover, the power of eminent domain necessarily involves a derogation of a fundamental or private right
of the people.[35] Accordingly, the manifest change in the legislative language -- from resolution under BP 337 to
ordinance under RA 7160 -- demands a strict construction. No species of property is held by individuals with
greater tenacity, and is guarded by the Constitution and laws more sedulously, than the right to the freehold of
inhabitants. When the legislature interferes with that right and, for greater public purposes, appropriates the land
of an individual without his consent, the plain meaning of the law should not be enlarged by doubtful
interpretation.[36]
Petitioner relies on Article 36, Rule VI of the Implementing Rules, which requires only a resolution to
authorize an LGU to exercise eminent domain. This is clearly misplaced, because Section 19 of RA 7160, the
law itself, surely prevails over said rule which merely seeks to implement it. [37]It is axiomatic that the clear letter
of the law is controlling and cannot be amended by a mere administrative rule issued for its
implementation.Besides, what the discrepancy seems to indicate is a mere oversight in the wording of the
implementing rules, since Article 32, Rule VI thereof, also requires that, in exercising the power of eminent
domain, the chief executive of the LGU must act pursuant to an ordinance.
In this ruling, the Court does not diminish the policy embodied in Section 2, Article X of the Constitution,
which provides that territorial and political subdivisions shall enjoy local autonomy. It merely upholds the law
as worded in RA 7160. We stress that an LGU is created by law and all its powers and rights are sourced
therefrom. It has therefore no power to amend or act beyond the authority given and the limitations imposed on
it by law.Strictly speaking, the power of eminent domain delegated to an LGU is in reality not eminent but
inferior domain, since it must conform to the limits imposed by the delegation, and thus partakes only of a share
in eminent domain.[38] Indeed, the national legislature is still the principal of the local government units, which
cannot defy its will or modify or violate it.[39]
Complaint Does Not State a Cause of Action
In its Brief filed before Respondent Court, petitioner argues that its Sanguniang Bayan passed an ordinance
on October 11, 1994 which reiterated its Resolution No. 93-35, Series of 1993, and ratified all the acts of its
mayor regarding the subject expropriation.[40]
This argument is bereft of merit. In the first place, petitioner merely alleged the existence of such an
ordinance, but it did not present any certified true copy thereof. In the second place, petitioner did not raise this
point before this Court. In fact, it was mentioned by private respondent, and only in passing. [41] In any event,
this allegation does not cure the inherent defect of petitioners Complaint for expropriation filed on September
23, 1993. It is hornbook doctrine that:

x x x in a motion to dismiss based on the ground that the complaint fails to state a cause of action, the question
submitted before the court for determination is the sufficiency of the allegations in the complaint itself.Whether
those allegations are true or not is beside the point, for their truth is hypothetically admitted by the motion. The
51
issue rather is: admitting them to be true, may the court render a valid judgment in accordance with the prayer
of the complaint?[42]

The fact that there is no cause of action is evident from the face of the Complaint for expropriation which
was based on a mere resolution. The absence of an ordinance authorizing the same is equivalent to lack of cause
of action. Consequently, the Court of Appeals committed no reversible error in affirming the trial courts
Decision which dismissed the expropriation suit
Second Issue:

Eminent Domain Not Barred by Res Judicata

As correctly found by the Court of Appeals[43] and the trial court,[44] all the requisites for the application
of res judicata are present in this case. There is a previous final judgment on the merits in a prior expropriation
case involving identical interests, subject matter and cause of action, which has been rendered by a court having
jurisdiction over it.
Be that as it may, the Court holds that the principle of res judicata, which finds application in generally all
cases and proceedings,[45] cannot bar the right of the State or its agent to expropriate private property. The very
nature of eminent domain, as an inherent power of the State, dictates that the right to exercise the power be
absolute and unfettered even by a prior judgment or res judicata. The scope of eminent domain is plenary and,
like police power, can reach every form of property which the State might need for public use. [46] All separate
interests of individuals in property are held of the government under this tacit agreement or implied
reservation. Notwithstanding the grant to individuals, the eminent domain, the highest and most exact idea of
property, remains in the government, or in the aggregate body of the people in their sovereign capacity; and they
have the right to resume the possession of the property whenever the public interest requires it. [47] Thus, the
State or its authorized agent cannot be forever barred from exercising said right by reason alone of previous
non-compliance with any legal requirement.
While the principle of res judicata does not denigrate the right of the State to exercise eminent domain, it
does apply to specific issues decided in a previous case. For example, a final judgment dismissing an
expropriation suit on the ground that there was no prior offer precludes another suit raising the same issue; it
cannot, however, bar the State or its agent from thereafter complying with this requirement, as prescribed by
law, and subsequently exercising its power of eminent domain over the same property.[48] By the same token, our
ruling that petitioner cannot exercise its delegated power of eminent domain through a mere resolution will not
bar it from reinstituting similar proceedings, once the said legal requirement and, for that matter, all others are
properly complied with. Parenthetically and by parity of reasoning, the same is also true of the principle of law
of the case. In Republic vs De Knecht,[49] the Court ruled that the power of the State or its agent to exercise
eminent domain is not diminished by the mere fact that a prior final judgment over the property to be
expropriated has become the law of the case as to the parties. The State or its authorized agent may still
subsequently exercise its right to expropriate the same property, once all legal requirements are complied
with. To rule otherwise will not only improperly diminish the power of eminent domain, but also clearly defeat
social justice.
WHEREFORE, the petition is hereby DENIED without prejudice to petitioners proper exercise of its
power of eminent domain over subject property. Costs against petitioner.
SO ORDERED.
Davide, Jr., (Chairman), Bellosillo, Vitug, and Quisumbing, JJ., concur.

52
 Republic of the Philippines
Supreme Court
Manila
SECOND DIVISION

MARGARITA F. CASTRO, G.R. No. 183719

Petitioner,
Present:

CARPIO, J.,
Chairperson,
- versus - NACHURA,
PERALTA,
ABAD, and
MENDOZA, JJ.

Promulgated:
NAPOLEON A. MONSOD,
Respondent. February 2, 2011

x------------------------------------------------------------------------------------x
DECISION
NACHURA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the
Decision[1] dated May 25, 2007 and the Resolution[2] dated July 14, 2008 of the Court of Appeals (CA) in CA-
G.R. CV No. 83973.
The antecedents of the case are as follows:
Petitioner is the registered owner of a parcel of land located on Garnet Street, Manuela Homes, Pamplona, Las
Pias City, and covered by Transfer Certificate of Title (TCT) No. T-36071, with an area of one hundred thirty
(130) square meters (sq.m.). Respondent, on the other hand, is the owner of the property adjoining the lot of
petitioner, located on Lyra Street, Moonwalk Village, Phase 2, Las Pias City. There is a concrete fence, more or
less two (2) meters high, dividing Manuela Homes from Moonwalk Village.[3]

On February 29, 2000, respondent caused the annotation of an adverse claim against sixty-five (65) sq.m. of the
property of petitioner covered by TCT No. T-36071. The adverse claim was filed without any claim of
ownership over the property. Respondent was merely asserting the existing legal easement of lateral and
subjacent support at the rear portion of his estate to prevent the property from collapsing, since his property is
located at an elevated plateau of fifteen (15) feet, more or less, above the level of petitioners property.
[4]
Respondent also filed a complaint for malicious mischief and malicious destruction before the office of
the barangay chairman.[5]

In defiance, petitioner filed a complaint for damages with temporary restraining order/writ of preliminary
injunction before the Regional Trial Court (RTC) of Las Pias City. Petitioner also prayed that the Register of
Deeds of Las Pias City be ordered to cancel the annotation of the adverse claim on TCT No. T-36071.[6]
Prior to the filing of the case before the RTC, there were deposits of soil and rocks about two (2) meters away
from the front door of the house of

53
petitioner. As such, petitioner was not able to park her vehicle at the dead-end portion of Garnet Street. When
petitioner noticed a leak that caused the front portion of her house to be slippery, she hired construction workers
to see where the leak was coming from. The workers had already started digging when police officers sent by
respondent came and stopped the workers from finishing their job.[7]

Petitioner averred that when she bought the property from Manuela Homes in 1994, there was no annotation or
existence of any easement over the property. Respondent neither asked permission nor talked to her with regard
to the use of 65 sq.m. of her property as easement. Upon learning of the adverse claim, she felt disturbed and
experienced sleepless nights for fear that she would not be able to sell her property. Petitioner admitted that
TCT No. 36071 does not cover the open space at the dead-end portion of Garnet Street.[8]

For his part, respondent claimed that he and his family had been residing in Moonwalk Village since June 1984.
Adjacent to his property is the land of petitioner in Manuela Homes. When he bought the property in 1983, the
land elevation of Moonwalk Village was almost on the same level as Manuela Homes. However, sometime in
1985 and 1986, Pilar Development Corporation, the developer of Manuela Homes, bulldozed, excavated, and
transferred portions of the elevated land to the lower portions of Manuela Homes.
Thus, Manuela Homes became lower than Moonwalk Village.[9]

Before the said excavation, respondent personally complained to Pilar Development Corporation and was
assured that, as provided by the National Building Code, an embankment will be retained at the boundary of
Manuela Homes and Moonwalk Village, which is more or less fifteen (15) feet higher than Manuela Homes.[10]

Manuela Homes retained the embankment consisting of soil and rocks. Respondent had the open space
riprapped with stones as reinforcement against any potential soil erosion, earthquake, and possible digging by
any person.

Respondent asserted that the affidavit of adverse claim was for the annotation of the lateral and subjacent
easement of his property over the property of petitioner, in view of the latters manifest determination to remove
the embankment left by the developer of Manuela Homes.
On October 11, 2004, the RTC rendered a decision,[11] the dispositive portion of which reads:
WHEREFORE, premises considered, this court hereby renders judgment: (1) ordering the
cancellation of [respondents] adverse claim at the back of Transfer Certificate of Title No. T-
36071 at the expense of [respondent] Napoleon Monsod; (2) ordering the said [respondent] to
pay the herein [petitioner] the amount of Php50,000.00 as moral damages; and (3) dismissing
[petitioners] claim for actual damages, attorneys fees, litigation costs and costs of suit and
[respondents] compulsory counterclaim for lack of merit.

SO ORDERED.[12]
The trial court ratiocinated that the adverse claim of respondent was non-registrable considering that the basis of
his claim was an easement and not an interest adverse to the registered owner, and neither did he contest the title
of petitioner. Furthermore, the adverse claim of respondent failed to comply with the requisites provided under
Section 70 of Presidential Decree No. 1529.[13]
On appeal, the CA reversed the decision of the trial court in a Decision [14] dated May 25, 2007, the fallo of
which reads:

WHEREFORE, premises considered, the instant appeal is GRANTED. The Decision of the
Regional Trial Court, Branch 198, Las Pias City dated October 11, 2004 is REVERSED and
54
 SET ASIDE. The Court hereby orders the retention of the annotation at the back of Transfer
Certificate of Title No. T-36071, not as an adverse claim, but a recognition of the existence of a
legal easement of subjacent and lateral support constituted on the lengthwise or horizontal land
support/embankment area of sixty-five (65) square meters, more or less, of the property of
[petitioner] Margarita Castro. The writ of preliminary injunction issued by this Court on April
18, 2006 is hereby made permanent. [Petitioners] claim for damages is likewise DISMISSED.

SO ORDERED.[15]
The CA ruled that while respondents adverse claim could not be sanctioned because it did not fall under the
requisites for registering an adverse claim, the same might be duly annotated in the title as recognition of the
existence of a legal easement of subjacent and lateral support. The purpose of the annotation was to prevent
petitioner from making injurious excavations on the subject embankment as to deprive the residential house and
lot of respondent of its natural support and cause it to collapse. Respondent only asked that petitioner respect
the legal easement already existing thereon.[16]

On June 15, 2007, petitioner filed a motion for reconsideration. However, the CA denied the same in a
Resolution[17] dated July 14, 2008.

Hence, this petition.

The issue in this case is whether the easement of lateral and subjacent support exists on the subject adjacent
properties and, if it does, whether the same may be annotated at the back of the title of the servient estate.

Article 437 of the Civil Code provides that the owner of a parcel of land is the owner of its surface and of
everything under it, and he can construct thereon any works, or make any plantations and excavations which he
may deem proper. However, such right of the owner is not absolute and is subject to the following
limitations: (1) servitudes or easements,[18] (2) special laws,[19] (3) ordinances,[20] (4) reasonable requirements of
aerial navigation,[21] and (5) rights of third persons.[22]

Respondent filed before the RTC an affidavit of adverse claim, the pertinent portions of which read:

5. That our adverse claim consists of rights of legal or compulsory easement of lateral and
subjacent support (under the Civil Code) over a portion of the above-described property of owner
Margarita F. Castro, that is, covering the lengthwise or horizontal land support/embankment area
of sixty-five (65) square meters, more or less.

6. That said registered owner has attempted to destroy and/or remove portions of the existing
lateral/subjacent land and cement supports adjoining the said two properties. In fact, a portion of
the easement was already destroyed/removed, to the continuing prejudice of herein adverse
claimant, and that a formal complaint against said registered owner was filed by the herein
adverse claimant before the Office of the Barangay Chairman of Talon V, Las Pias City and the
same proved futile.[23]

Respondents assertion that he has an adverse claim over the 65 sq.m. property of petitioner is misplaced since
he does not have a claim over the ownership of the land. The annotation of an adverse claim over registered
land under Section 70 of Presidential Decree 1529 [24] requires a claim on the title of the disputed land.
Annotation is done to apprise third persons that there is a controversy over the ownership of the land and to

55
preserve and protect the right of the adverse claimant during the pendency of the controversy. It is a notice to
third persons that any transaction regarding the disputed land is subject to the outcome of the dispute.[25]
In reality, what respondent is claiming is a judicial recognition of the existence of the easement of subjacent and
lateral support over the 65 sq. m. portion of petitioners property covering the land support/embankment area.
His reason for the annotation is only to prevent petitioner from removing the embankment or from digging on
the property for fear of soil erosion that might weaken the foundation of the rear portion of his property which is
adjacent to the property of petitioner.
An easement or servitude is an encumbrance imposed upon an immovable for the benefit of another immovable
belonging to a different owner.[26] There are two kinds of easements according to source. An easement is
established either by law or by will of the owners. [27] The courts cannot impose or constitute any servitude
where none existed. They can only declare its existence if in reality it exists by law or by the will of the owners.
There are therefore no judicial easements.[28]
Article 684 of the Civil Code provides that no proprietor shall make such excavations upon his land as to
deprive any adjacent land or building of sufficient lateral or subjacent support. An owner, by virtue of his
surface right, may make excavations on his land, but his right is subject to the limitation that he shall not
deprive any adjacent land or building of sufficient lateral or subjacent support. Between two adjacent
landowners, each has an absolute property right to have his land laterally supported by the soil of his neighbor,
and if either, in excavating on his own premises, he so disturbs the lateral support of his neighbors land as to
cause it, or, in its natural state, by the pressure of its own weight, to fall away or slide from its position, the one
so excavating is liable.[29]
In the instant case, an easement of subjacent and lateral support exists in favor of respondent. It was established
that the properties of petitioner and respondent adjoin each other. The residential house and lot of respondent is
located on an elevated plateau of fifteen (15) feet above the level of petitioners property. The embankment and
the riprapped stones have been in existence even before petitioner became the owner of the property. It was
proven that petitioner has been making excavations and diggings on the subject embankment and, unless
restrained, the continued excavation of the embankment could cause the foundation of the rear portion of the
house of respondent to collapse, resulting in the destruction of a huge part of the family dwelling.[30]
We sustain the CA in declaring that a permanent injunction on the part of petitioner from making injurious
excavations is necessary in order to protect the interest of respondent. However, an annotation of the existence
of the subjacent and lateral support is no longer necessary. It exists whether or not it is annotated or registered in
the registry of property. A judicial recognition of the same already binds the property and the owner of the same,
including her successors-in-interest. Otherwise, every adjoining landowner would come to court or have the
easement of subjacent and lateral support registered in order for it to be recognized and respected.
WHEREFORE, in view of the foregoing, the Decision dated May 25, 2007 and the Resolution dated July 14,
2008 of the Court of Appeals in CA-G.R. CV No. 83973 are hereby AFFIRMED WITH
MODIFICATION that the annotation at the back of Transfer Certificate of Title No. T-36071, recognizing the
existence of the legal easement of subjacent and lateral support constituted on the lengthwise or horizontal land
support/embankment area of sixty-five (65) square meters, more or less, of the property of petitioner Margarita
F. Castro, is hereby ordered removed.

SO ORDERED.

56
 FIRST DIVISION

HEIRS OF BIENVENIDO AND G.R. No. 175763

ARACELI TANYAG, namely:
ARTURO TANYAG, AIDA T. Present:
JOCSON AND ZENAIDA T.
VELOSO, CORONA, C.J.,
Petitioners, Chairperson,
LEONARDO-DE CASTRO,
BERSAMIN,
- versus - DEL CASTILLO, and
VILLARAMA, JR., JJ.

SALOME E. GABRIEL, NESTOR R.

GABRIEL, LUZ GABRIEL-ARNEDO Promulgated:
married to ARTURO ARNEDO, NORA
GABRIEL-CALINGO April 11, 2012
married to FELIX CALINGO, PILAR
M. MENDIOLA, MINERVA
GABRIEL-NATIVIDAD marriedto
EUSTAQUIO NATIVIDAD, and
ERLINDA VELASQUEZ married to
HERMINIO VELASQUEZ,
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION
VILLARAMA, JR., J.:

This is a petition for review under Rule 45 which seeks to reverse the Decision [1] dated August 18, 2006 and
Resolution[2] dated December 8, 2006 of the Court of Appeals (CA) in CA-G.R. CV No. 81224. The CA
affirmed the Decision[3] dated November 19, 2003 of the Regional Trial Court of Pasig City, Branch 267 in Civil
Case No. 67846 dismissing petitioners complaint for declaration of nullity of Original Certificate of Title (OCT)
No. 1035, reconveyance and damages, as well as respondents counterclaims for damages and attorneys fees.

Subject of controversy are two adjacent parcels of land located at Ruhale, Barangay Calzada, Municipality of
Taguig (now part of Pasig City, Metro Manila). The first parcel (Lot 1) with an area of 686 square meters was
originally declared in the name of Jose Gabriel under Tax Declaration (TD) Nos. 1603 and 6425 issued for the
years 1949 and 1966, while the second parcel (Lot 2) consisting of 147 square meters was originally declared in
the name of Agueda Dinguinbayan under TD Nos. 6418 and 9676 issued for the years 1966 and 1967. [4] For
several years, these lands lined with bamboo plants remained undeveloped and uninhabited.

Petitioners claimed that Lot 1 was owned by Benita Gabriel, sister of Jose Gabriel, as part of her inheritance as
declared by her in a 1944 notarized instrument (Affidavit of Sale) whereby she sold the said property to spouses
Gabriel Sulit and Cornelia Sanga. Said document states:

DAPAT MALAMAN NG LAHAT NG MAKABABASA

Na, akong Benita Gabriel, balo sa nasirang Calixto Lontoc, Filipina may karapatang gulang
naninirahan sa nayon ng Palingon, Tagig, Rizal, x x x sa pamamaguitan nitoy

ISINASAYSAY KO AT PINAGTITIBAY

57
 1.) Na, sarili ko at tunay na pagaari ang isang lagay na lupang kawayanan na sapagkat itoy
kabahagui ko sa aking kapatid na [J]ose Gabriel, na itoy mana ko sa aking nasirang ama Mateo
Gabriel sa kami lamang dalawa ng aking kapatid na binabanguit ko na Jose Gabriel siyang mga
anak at tagapagmana ng aming amang nasirang Mateo Gabriel, maliban sa amin ay wala nang
iba, kayat kami ay naghati sa mga ari-arian na na iwan sa amin ng nasirang ama namin na Mateo
Gabriel, na ang lupang kawayanang itoy may nakatanim na walong (8) punong kawayan at na sa
pook na kung pamagatan ay Ruhale nayon ng Calzada, Tagig, Rizal, at na sa loob ng mga
kahanganan at sukat na sumusunod[:]

Na, ang kahangan sa Hilagaan Sapang Ruhale at Vicente Bunye, sa Amihanan Felipe
Pagkalinawan, sa Timugan Juan Flores, at sa Habagatan Apolonio Ocol may sukat na 6 areas at
85 centiareas may halagan amillarada na P80.00) Pesos alinsunod sa Tax Blg. 20037, sa pangalan
ng aking kapatid na Jose Gabriel. Na, ang lupang itoy hindi natatala sa bisa ng batas Blg. 496 ni
sa susog gayon din sa Hipotecaria Espaola itoy may mga mojon bato ang mga panulok at
walang bakod.

2.) Na, alang-alang sa halagang SIYAMNAPO AT ANIM (P96.00) na Pisong salaping

guinagamit dito sa Filipinas na bago dumating ang mga sandaling itoy tinaggap ko at ibinayad sa
akin ng boong kasiyahang loob ko ng magasawang GABRIEL SULIT AT CORNELIA SANGA,
mga Filipinos may mga karapatang gulang mga naninirahan sa nayon ng Calzada, Tagig, Rizal,
ngayon ay inilipat ko at ipinagbili ng bilihang tuluyan (Venta real soluta) ang isinasaysay kong
lupang kawayanan sa itaas nito ng nasabi halagang SIYAMNAPO AT ANIM (P96.00) na Piso at
sa nabanguit na magasawang GABRIEL SULIT AT CORNELIA SANGA, gayon din sa lahat ng
mga tagapagmana nila, ngayong mga arao na ito ay ang may hawak at namamahala ng lupang
itoy ang mga nakabili sa akin na magasawang GABRIEL SULIT AT CORNELIA SANGA.

3.) Na, ang kasulatang itoy ng bilihan ay nais na itala sa bisa ng batas Blg. 3344.

NA SA KATUNAYAN NG LAHAT NG ITOY ako ay lumagda sa kasulatang ito dito sa

Tagig, Rizal, ngayong ika - 28 ng Junio 1944.

(Nilagdaan) BENITA GABRIEL[5]

Lot 1 allegedly came into the possession of Benita Gabriels own daughter, Florencia Gabriel Sulit, when her
father-in-law Gabriel Sulit gave it to her as part of inheritance of his son, Eliseo Sulit who was Florencias
husband. Florencia Sulit sold the same lot to Bienvenido S. Tanyag, father of petitioners, as evidenced by a
notarized deed of sale dated October 14, 1964.[6] Petitioners then took possession of the property, paid the real
estate taxes due on the land and declared the same for tax purposes, as shown by TD No. 11445 issued in 1969
in the name of Bienvenidos wife, Araceli C. Tanyag; TD No. 11445 cancelled TD No. 6425 in the name of Jose
Gabriel. TD Nos. 3380 and 00486 also in the name of Araceli Tanyag were issued in the years 1974 and 1979.[7]

As to Lot 2, petitioners averred that it was sold by Agueda Dinguinbayan to Araceli Tanyag under Deed
of Sale executed on October 22, 1968. Thereupon, petitioners took possession of said property and declared the
same for tax purposes as shown by TD Nos. 11361, 3395, 120-014-00482, 120-00-014-20-002-000, C-014-
00180 and D-014-00182 issued for the years 1969, 1974, 1979, 1985, 1991 and 1994. [8]Petitioners claimed to
have continuously, publicly, notoriously and adversely occupied both Lots 1 and 2 through their caretaker Juana
Quinones[9]; they fenced the premises and introduced improvements on the land.[10]

Sometime in 1979, Jose Gabriel, father of respondents, secured TD No. 120-014-01013 in his name over
Lot 1 indicating therein an increased area of 1,763 square meters. Said tax declaration supposedly cancelled TD
No. 6425 over Lot 1 and contained the following inscription[11]:
58
 Note: Portions of this Property is Also Declared
in the name of Araceli C. Tanyag under
T.D.#120-014-00858 686 sq. m.

Also inscribed on TD No. 120-014-00858[12] (1979) in the name of Araceli Tanyag covering Lot 1 are
the following:

This property is also covered by T.D. #120-014-01013

in the name of Jose P. Gabriel
1-8-80

which notation was carried into the 1985, 1990 and 1991 tax declarations, all in the name of Araceli Tanyag.

On March 20, 2000, petitioners instituted Civil Case No. 67846 alleging that respondents never occupied the
whole 686 square meters of Lot 1 and fraudulently caused the inclusion of Lot 2 in TD No. 120-014-01013 such
that Lot 1 consisting of 686 square meters originally declared in the name of Jose Gabriel was increased to
1,763 square meters. They contended that the issuance of OCT No. 1035 on October 28, 1998 over the subject
land in the name of respondents heirs of Jose Gabriel was null and void from the beginning.[13]

On the other hand, respondents asserted that petitioners have no cause of action against them for they
have not established their ownership over the subject property covered by a Torrens title in respondents
name. They further argued that OCT No. 1035 had become unassailable one year after its issuance and
petitioners failed to establish that it was irregularly or unlawfully procured.[14]

Respondents evidence showed that the subject land was among those properties included in the
Extrajudicial Settlement of Estate of Jose P. Gabriel [15] executed on October 5, 1988, covered by TD No. B-014-
00643 (1985) in the name of Jose Gabriel. Respondents declared the property in their name but the tax
declarations (1989, 1991 and 1994) carried the notation that portions thereof (686 sq. ms.) are also declared in
the name of Araceli Tanyag. On October 28, 1998, OCT No. 1035[16] was issued to respondents by the Register
of Deeds of Pasig, Metro Manila under Decree No. N-219177 pursuant to the Decision dated September 20,
1996 of the Land Registration Court in LRC Case No. N-11260, covering Lot 1836 MCadm-590-D, Taguig
Cadastral Mapping, Plan Ap-04-002253, with an area of 1,560 square meters.

On the other hand, respondents TD Nos. D-014-00839 and D-014-01923 issued in 1993 and 1999
respectively, showed that respondents sold 468 square meters of Lot 1 to Jayson Sta. Barbara. [17] The
segregation of said 468 square meters pertaining to Jayson Sta. Barbara was reflected in the approved survey
plan of Lot 1836 prepared by respondents surveyor on March 18, 2000.[18]

At the trial, petitioners presented their witness Arturo Tanyag, son of Bienvenido Tanyag and Araceli
Tanyag who died on March 30, 1968 and October 30, 1993, respectively. He testified that according to
Florencia Sulit, Benita Gabriel-Lontoc and her family were the ones in possession of Lot 1 since 1944; Benita
Gabriel had executed an Affidavit of Sale declaring said property as her inheritance and conveying the same to
spouses Gabriel and Cornelia Sulit. He affirmed that they had been in possession of Lot 1 from the time
Bienvenido Tanyag bought the land from Florencia Sulit in 1964. Based on the boundaries indicated in the tax
declaration, they fenced the property, installed Juana Quinones as their caretaker who also attended to the
piggery, put up an artesian well and planted some trees. From 1964 up to 1978, nobody disturbed them in their
possession or claimed ownership of the land; four years after acquiring Lot 1, they also purchased the adjacent
property (Lot 2) to expand their piggery. Lot 2 was also separately declared for tax purposes after their mother
purchased it from Agueda Dinguinbayan. He had personally witnessed the execution of the 1968 deed of sale
59
including its notarization, and was also present during the physical turn over of Lot 2 by the seller. In fact, he
was one of the instrumental witnesses to the deed of sale and identified his signature therein. He further
described the place as inaccessible at that time as there were no roads yet and they had to traverse muddy tracks
to reach their property.[19]

Arturo further testified that the first time they met Jose Gabriel was when the latter borrowed from their
mother all the documents pertaining to their property. Jose Gabriel came looking for a piece of property which
he claims as his but he had no documents to prove it and so they showed him their documents pertaining to the
subject property; out of the goodness of her mothers heart, she lent those documents to her brother Jose
Gabriel. During the cadastral survey conducted in 1976, they had both lots surveyed in preparation for their
consolidation under one tax declaration. However, they did not succeed in registering the consolidated lots as
they discovered that there was another tax declaration covering the same properties and these were applied for
titling under the name of Jose Gabriel sometime in 1978 or 1980, which was after the time said Jose Gabriel
borrowed the documents from their mother. No notice of the hearings for application of title filed by Jose
Gabriel was received by them. They never abandoned the property and their caretaker never left the place
except to report to the police when she was being harassed by the respondents. He also recalled that respondents
had filed a complaint against them before the barangay but since no agreement was reached after several
meetings, they filed the present case.[20]

The next witness for petitioners was Juana Quinones, their caretaker who testified that she had been
staying on petitioners property since 1964 or for 35 years already. She had built a nipa hut and artesian well,
raised piggery and poultry and planted some root crops and vegetables on the land. At first there was only one
parcel but later the petitioners bought an additional lot; Arturo Tanyag gave her money which she used for the
fencing of the property. During all the time she occupied the property there was nobody else claiming it and she
also had not received any notice for petitioners concerning the property, nor the conduct of survey on the
land. On cross-examination, she admitted that she was living alone and had no Voters ID or any document
evidencing that she had been a resident there since 1964. Although she was living alone, she asks for help from
other persons in tending her piggery.[21]

Angelita Sulit-delos Santos, cousin of petitioners and also of respondents, testified that she came to
know the subject property because according to her paternal grandfather Gabriel Sta. Ana Sulit, her maternal
grandmother Benita Gabriel-Lontoc mortgaged the property to him.It was Benita Gabriel Lontoc who took care
of her, her siblings and cousins; they lived with her until her death. She identified the signature of Benita
Gabriel in the 1944 Affidavit of Sale in favor of Gabriel Sulit. Lot 1 consisting of 600 square meters was vacant
property at that time but her family was in possession thereof when it was sold to Gabriel Sulit; it was her father
Eliseo Sulit and uncle Hilario Sulit, who were incharge of their property. On cross-examination, she was asked
details regarding the supposed mortgage of Lot 1 to Gabriel Sulit but she admitted she does not know anything
as she was still very young then.[22]

Respondents first witness was Roberto Gabriel Arnedo, son of Luz Gabriel-Arnedo. He testified that
when he was about 5 or 6 years old (1953 or 1954), his grandfather Jose Gabriel used to bring him along to visit
the subject property consisting of 1,763 square meters based on the tax declaration and OCT. They had picnics
and celebrate his grandfathers birthday there. He recalled accompanying his grandfather in overseeing the
planting of gumamela which served as the perimeter fence. Jose Gabriel had not mentioned anything about the
claim of petitioners over the same land; Jose Gabriel handed the documents pertaining to the land to his eldest
aunt and hence it now belongs to them.[23] On cross-examination, he claimed that during those years he had
visited the land together with his grandfather, he did not see Florencia Sulit and her family.[24]

60
 Virginia Villanueva, daughter of Salome Gabriel, testified that they acquired the subject property from
their grandfather Jose Gabriel who had a tax declaration in his name. Her mother furnished them with
documents such as tax declarations and the extrajudicial settlement of the estate of Jose Gabriel; they also have
an approved survey plan prepared for Salome Gabriel. She does not know the petitioners in this case.[25] On
cross-examination, she said that the subject property was inherited by Jose Gabriel from his father Mateo
Gabriel; Jose Gabriel was the sole owner of the land while Benita Gabriel has separate properties in Palingon
and Langkokak.[26] Though they are not actually occupying the property, they visit the place and she does not
know anybody occupying it, except for the portion (486 square meters) which petitioners sold to Sta. Barbara. A
nine-door apartment was built on the said portion without their permission. She had talked to both Sta. Barbara
and with Arturo Tanyag they had meetings before the barangay; however, petitioners filed the present case in
court. She insisted that there is nobody residing in the subject property; there is still the remaining 901 square
meters which is owned by their mother. She admitted there were plants on the land but she does not know who
actually planted them; it was her grandfather who built a wooden fence and gumamela in the 1960s. As to the
hearings on the application for title, she had not attended the same; she does not know whether the petitioners
were notified of the said hearings. She also caused the preparation of the survey plan for Salome Gabriel. On
the increased area of the property indicated in the later tax declarations, she admitted the discrepancy but said
there were barangay roads being built at the time.[27]

Esmeraldo Ramos, Municipal Assessor of Taguig, testified that he was formerly a Land Appraiser in the
Office of the Municipal Assessor of Taguig and in the course of his duties had certified one of the tax
declarations in the name of respondents (TD No. EL-014-10585). He identified and verified said document and
the other tax declarations submitted in court by the respondents. He admitted that on January 10, 1980, they
made the entry on TD No. 6425 in the name of Jose Gabriel that the same was cancelled by TD No. 120-014-
01013 also in the name of Jose Gabriel who presented a supposed deed of sale in favor of Araceli Tanyag which
caused the earlier cancellation of TD No. 6425 in his name. However, upon investigation they found out that the
seller Florencia Sulit was not the owner because the declared owner was Jose Gabriel; even the deed of sale
recognized that the property was declared in the name of Jose Gabriel. They also discovered from the cadastral
survey and tax mapping of Taguig that the property is in the name of Jose Gabriel both in the Bureau of Lands
and Municipal Assessors Office. As far as he knows, it was Jose Gabriel who owned the subject property which
he usually visited; he recalled that around the late 70s and 80s, he ordered the fencing of barbed wire and
bamboo stalks on the land which is just 3 lots away from his own property. As to the discrepancy in the area of
the property as originally declared by Jose Gabriel, he explained that the boundaries in the original tax
declaration do not change but after the land is surveyed, the boundaries naturally would be different because the
previous owner may have sold his property or the present owner inherits the property from his parents. He
admitted that the tax declaration is just for tax purposes and not necessarily proof of ownership or possession of
the property it covers.[28]

Respondents last witness was Antonio Argel who testified that he had resided for 52 years on a land near
the subject property and as far as he knows it was Jose Gabriel who owns it and planted thereon. On cross-
examination, he admitted that Jose Gabriel was not in physical possession of the property. He just assumed that
the present occupants of the property were allowed by Jose Gabriel to stay therein because he is the
owner. There is an apartment and three small houses existing on the property, and about five families are living
there. He confirmed that there is a piggery being maintained by a certain Juana who had been residing there
maybe for fifteen years already.[29]

In rebuttal, petitioners presented two witnesses who are owners of properties adjoining that of the
subject land. Rodante Domingo testified that it was only now did he learn that the property of Arturo Tanyag is
already titled in the name of respondents. He was not aware of the titling proceeding because he never received
any notice as adjoining owner. His own property is already titled in his name and he even asked Arturo Tanyag

61
to act as a witness in his application for titling. [30] On the other hand, Dado Dollado testified that he acquired his
property in 1979. He likewise affirmed that he did not receive any notice of the proceedings for application for
titling filed by respondents and it was only now that he learned from Arturo Tanyag that the subject property
was already titled in the names of respondents.[31]

The last rebuttal witness for petitioners was Dominador Dinguinbayan Ergueza, son of Agueda
Dinguinbayan. He testified that the subject property was formerly owned by his mother and the present owner is
Araceli Tanyag who bought the same from his mother in 1968.He described the boundaries of the property in
relation to the adjoining owners at that time; presently, the left portion is already a street (Rujale St.) going
towards the sea. He admitted that his wife, Livina Ergueza was an instrumental witness in the 1968 deed of sale
in favor of Araceli Tanyag.[32]

In its decision, the trial court dismissed the complaint as well as the counterclaim, holding that
petitioners failed to establish ownership of the subject property and finding the respondents to be the declared
owners and legal possessors. It likewise ruled that petitioners were unable to prove by preponderance of
evidence that respondents acquired title over the property through fraud and deceit.

Petitioners appealed to the CA which affirmed the trial courts ruling. The CA found that apart from the
Affidavit executed by Benita Gabriel in 1944 claiming that she inherited Lot 1 from their father, Mateo Gabriel,
there is no evidence that she, not Jose Gabriel, was the true owner thereof. It noted that just four years after
Benita Gabriels sale of the subject property to the Sulit spouses, Jose Gabriel declared the same under his name
for tax purposes, paying the corresponding taxes. The appellate court stressed that petitioners allegation of bad
faith was not proven.

Petitioners motion for reconsideration was likewise denied by the CA. Hence, this petition.

Petitioners assail the CA in not finding that the respondents obtained OCT No. 1035 in their names
fraudulently and in bad faith. They also claim to have acquired ownership of the subject lots by virtue of
acquisitive prescription.

The issues presented are: (1) whether respondents committed fraud and bad faith in registering the
subject lots in their name; and (2) whether petitioners acquired the property through acquisitive prescription.

Registration of a piece of land under the Torrens System does not create or vest title, because it is not a
mode of acquiring ownership. A certificate of title is merely an evidence of ownership or title over the particular
property described therein.[33] Thus, notwithstanding the indefeasibility of the Torrens title, the registered owner
may still be compelled to reconvey the registered property to its true owners. The rationale for the rule is that
reconveyance does not set aside or re-subject to review the findings of fact of the Bureau of Lands. In an action
for reconveyance, the decree of registration is respected as incontrovertible. What is sought instead is the
transfer of the property or its title which has been wrongfully or erroneously registered in another persons name,
to its rightful or legal owner, or to the one with a better right.[34]

An action for annulment of title or reconveyance based on fraud is imprescriptible where the plaintiff is
in possession of the property subject of the acts. [35] The totality of the evidence on record established that it was
petitioners who are in actual possession of the subject property; respondents merely insinuated at occasional
visits to the land. However, for an action for reconveyance based on fraud to prosper, this Court has held that the
party seeking reconveyance must prove by clear and convincing evidence his title to the property and the fact of
fraud.[36]

62
 The CA correctly observed that the only evidence of Benita Gabriels supposed title was the 1944 Affidavit
of Sale whereby Benita Gabriel claimed sole ownership of Lot 1 as her inheritance from their father, Mateo
Gabriel. The property until 1949 was still declared in the name Jose Gabriel despite the 1944 sale executed by
Benita Gabriel in favor of spouses Gabriel and Cornelia Sulit. As to the alleged fraud perpetrated by Jose Gabriel
and respondents in securing OCT No. 1035 in their name, this was clearly not proven as Arturo Tanyag testified
merely that Jose Gabriel borrowed their documents pertaining to the property. No document or testimony was
presented to show that Jose Gabriel employed deceit or committed fraudulent acts in the proceedings for titling of
the property.

However, the CA did not address the issue of acquisitive prescription raised by the petitioners. In their
Complaint before the lower court, petitioners alleged

15. Defendants never occupied the whole area of the lot covered by Tax Declaration No.
1603 (686 sq. m.) neither were they able to set foot on the property covered by Tax Declaration
No. 6542 [sic] for the reason that those lots had been in actual, open continuous, adverse and
notorious possession of the plaintiffs against the whole world for more than thirty years which is
equivalent to title.

x x x x[37]

Such character and length of possession of a party over a parcel of land subject of controversy is a factual
issue. Settled is the rule that questions of fact are not reviewable in petitions for review on certiorari under Rule
45 of the Rules of Court, as only questions of law shall be raised in such petitions. While this Court is not a trier
of facts, if the inference drawn by the appellate court from the facts is manifestly mistaken, it may, in the
interest of justice, review the evidence in order to arrive at the correct factual conclusions based on the record.
[38]

In this case, the CA was mistaken in concluding that petitioners have not acquired any right over the subject
property simply because they failed to establish Benita Gabriels title over said property. The appellate court
ignored petitioners evidence of possession that complies with the legal requirements of acquiring ownership by
prescription.

Acquisitive prescription is a mode of acquiring ownership by a possessor through the requisite lapse of
time. In order to ripen into ownership, possession must be in the concept of an owner, public, peaceful and
uninterrupted.[39] Possession is open when it is patent, visible, apparent, notorious and not clandestine. [40] It is
continuous when uninterrupted, unbroken and not intermittent or occasional; exclusive when the adverse
possessor can show exclusive dominion over the land and an appropriation of it to his own use and benefit; and
notorious when it is so conspicuous that it is generally known and talked of by the public or the people in the
neighborhood. The party who asserts ownership by adverse possession must prove the presence of the essential
elements of acquisitive prescription.[41]

On the matter of prescription, the Civil Code provides:

Art. 1117. Acquisitive prescription of dominion and other real rights may be ordinary or
extraordinary.

Ordinary acquisitive prescription requires possession of things in good faith and with just
title for the time fixed by law.

Art. 1134. Ownership and other real rights over immovable property are acquired by
ordinary prescription through possession of ten years.
63
 Art. 1137. Ownership and other real rights over immovables also prescribe through
uninterrupted adverse possession thereof for thirty years, without need of title or of good
faith. (Emphasis supplied.)

Petitioners adverse possession is reckoned from 1969 with the issuance of TD No. 1145 in the name of
Araceli Tanyag, which tax declaration cancelled TD No. 6425 in the name of Jose Gabriel.[42] It is settled that
tax receipts and declarations are prima facie proofs of ownership or possession of the property for which such
taxes have been paid. Coupled with proof of actual possession of the property, they may become the basis of a
claim for ownership.[43] Petitioners caretaker, Juana Quinones, has since lived in a nipa hut, planted vegetables
and tended a piggery on the land. Aside from paying taxes due on the property, petitioners also exercised other
acts of ownership such as selling the 468-square meter portion to Sta. Barbara who had constructed thereon a
nine-door apartment building.

It was only in 1979 that respondents began to assert a claim over the property by securing a tax declaration in
the name of Jose Gabriel albeit over a bigger area than that originally declared. In 1998, they finally obtained an
original certificate of title covering the entire 1,763 square meters which included Lot 1. Did these acts of
respondents effectively interrupt the possession of petitioners for purposes of prescription?

We answer in the negative.

In the case of Heirs of Marcelina Azardon-Crisologo v. Raon[44] this Court citing Article 1123 of the Civil
Code[45] held that civil interruption takes place with the service of judicial summons to the possessor and not by
filing of a mere Notice of Adverse Claim. Thus:

Article 1123 of the Civil Code is categorical. Civil interruption is produced by judicial
summons to the possessor. Moreover, even with the presence of judicial summons, Article 1124
sets limitations as to when such summons shall not be deemed to have been issued and shall not
give rise to interruption, to wit: 1) if it should be void for lack of legal solemnities; 2) if the
plaintiff should desist from the complaint or should allow the proceedings to lapse; or 3) if the
possessor should be absolved from the complaint.

Both Article 1123 and Article 1124 of the Civil Code underscore the judicial character of
civil interruption. For civil interruption to take place, the possessor must have received
judicial summons. None appears in the case at bar. The Notice of Adverse Claim which was
filed by petitioners in 1977 is nothing more than a notice of claim which did not effectively
interrupt respondents possession. Such a notice could not have produced civil interruption. We
agree in the conclusion of the RTC, which was affirmed by the Court of Appeals, that the
execution of the Notice of Adverse Claim in 1977 did not toll or interrupt the running of the
prescriptive period because there remains, as yet, a necessity for a judicial determination of its
judicial validity. What existed was merely a notice. There was no compliance with Article 1123
of the Civil Code. What is striking is that no action was, in fact, filed by petitioners against
respondents. As a consequence, no judicial summons was received by respondents. As aptly
held by the Court of Appeals in its affirmance of the RTCs ruling, the Notice of Adverse Claim
cannot take the place of judicial summons which produces the civil interruption provided for
under the law. In the instant case, petitioners were not able to interrupt respondents adverse
possession since 1962. The period of acquisitive prescription from 1962 continued to run in
respondents favor despite the Notice of Adverse Claim.(Emphasis supplied.)

From 1969 until the filing of this complaint by the petitioners in March 2000, the latter have been in
continuous, public and adverse possession of the subject land for 31 years. Having possessed the property for
64
the period and in the character required by law as sufficient for extraordinary acquisitive prescription,
petitioners have indeed acquired ownership over the subject property. Such right cannot be defeated by
respondents acts of declaring again the property for tax purposes in 1979 and obtaining a Torrens certificate of
title in their name in 1998.

This notwithstanding, we uphold petitioners right as owner only with respect to Lot 1 consisting of 686
square meters. Petitioners failed to substantiate their claim over Lot 2 by virtue of a deed of sale from the
original declared owner, Agueda Dinguinbayan. Respondents asserted that the 147 square meters covered by the
tax declarations of Dinguinbayan being claimed by petitioners is not the same lot included in OCT No. 1035.

Under Article 434 of the Civil Code, to successfully maintain an action to recover the ownership of a real
property, the person who claims a better right to it must prove two (2) things: first, the identity of the land claimed;
and second, his title thereto. In regard to the first requisite, in an accion reinvindicatoria, the person who claims
that he has a better right to the property must first fix the identity of the land he is claiming by describing the
location, area and boundaries thereof.[46] In this case, petitioners failed to identify Lot 2 by providing evidence of
the metes and bounds thereof, so that the same may be compared with the technical description contained in OCT
No. 1035, which would have shown whether Lot 2 consisting of 147 square meters was erroneously included in
respondents title. The testimony of Agueda Dinguinbayans son would not suffice because said witness merely
stated the boundary owners as indicated in the 1966 and 1967 tax declarations of his mother. On his part, Arturo
Tayag claimed that he had the lots surveyed in the 1970s in preparation for the consolidation of the two
parcels. However, no such plan was presented in court.

WHEREFORE, the petition is PARTLY GRANTED. The Decision dated August 18, 2006 of the
Court of Appeals in CA-G.R. CV No. 81224 is MODIFIED in that petitioners heirs of Bienvenido and Araceli
Tanyag are hereby declared the owners of 686 square meters previously declared under Tax Declaration Nos.
11445, 120-014-00486, 120-014-0085, B-014-00501, E-014-01446, C-014-00893 and D-014-00839 all in the
name of Araceli Tanyag, which lot is presently covered by OCT No. 1035 issued by the Register of Deeds of
Pasig, Metro Manila in the name of respondents Salome Gabriel, Nestor R. Gabriel, Luz Gabriel-Arnedo, Nora
Gabriel-Calingo, Pilar Gabriel-Mendiola, Minerva Gabriel-Natividad and Erlinda Gabriel-
Velasquez. Respondents are ORDERED to RECONVEY the said 686-square meter portion to the petitioners.

No pronouncement as to costs.

SO ORDERED.

65
 FIRST DIVISION
[G.R. No. 68166. February 12, 1997]
HEIRS OF EMILIANO NAVARRO, petitioner, vs. INTERMEDIATE APPELLATE COURT AND
HEIRS OF SINFOROSO PASCUAL, respondents.

DECISION
HERMOSISIMA, JR., J.:

Unique is the legal question visited upon the claim of an applicant in a Land Registration case by
oppositors thereto, the Government and a Government lessee, involving as it does ownership of land formed by
alluvium.
The applicant owns the property immediately adjoining the land sought to be registered. His registered
property is bounded on the east by the Talisay River, on the west by the Bulacan River, and on the north by the
Manila Bay. The Talisay River and the Bulacan River flow down towards the Manila Bay and act as boundaries
of the applicant's registered land on the east and on the west.
The land sought to be registered was formed at the northern tip of the applicant's land. Applicant's
registered property is bounded on the north by the Manila Bay.
The issue: May the land sought to be registered be deemed an accretion in the sense that it naturally accrues
in favor of the riparian owner or should the land be considered as foreshore land?
Before us is a petition for review of: (1) the decision [1] and (2) two subsequent resolutions[2] of the
Intermediate Appellate Court[3] (now the Court of Appeals) in Land Registration Case No. N-84, [4] the
application over which was filed by private respondents' predecessor-in-interest, Sinforoso Pascual, now
deceased, before the Court of First Instance[5] (now the Regional Trial Court) of Balanga, Bataan.
There is no dispute as to the following facts:

On October 3, 1946, Sinforoso Pascual, now deceased, filed an application for foreshore lease covering a tract
of foreshore land in Sibocon, Balanga, Bataan, having an area of approximately seventeen (17) hectares. This
application was denied on January 15, 1953. So was his motion for reconsideration.

Subsequently, petitioners' predecessor-in-interest, also now deceased, Emiliano Navarro, filed a fishpond
application with the Bureau of Fisheries covering twenty five (25) hectares of foreshore land also in Sibocon,
Balanga, Bataan. Initially, such application was denied by the Director of Fisheries on the ground that the
property formed part of the public domain. Upon motion for reconsideration, the Director of Fisheries, on May
27, 1988, gave due course to his application but only to the extent of seven (7) hectares of the property as may
be certified by the Bureau of Forestry as suitable for fishpond purposes.

The Municipal Council of Balanga, Bataan, had opposed Emiliano Navarro's application. Aggrieved by the
decision of the Director of Fisheries, it appealed to the Secretary of Natural Resources who, however, affirmed
the grant. The then Executive Secretary, acting in behalf of the President of the Philippines, similarly affirmed
the grant.

On the other hand, sometime in the early part of 1960, Sinforoso Pascual filed an application to register and
confirm his title to a parcel of land, situated in Sibocon, Balanga, Bataan, described in Plan Psu-175181 and
said to have an area of 146,611 square meters. Pascual claimed that this land is an accretion to his property,
situated in Barrio Puerto Rivas, Balanga, Bataan, and covered by Original Certificate of Title No. 6830. It is
bounded on the eastern side by the Talisay River, on the western side by the Bulacan River, and on the northern
side by the Manila Bay. The Talisay River as well as the Bulacan River flow downstream and meet at the

66
Manila Bay thereby depositing sand and silt on Pascual's property resulting in an accretion thereon. Sinforoso
Pascual claimed the accretion as the riparian owner.

On March 25, 1960, the Director of Lands, represented by the Assistant Solicitor General, filed an opposition
thereto stating that neither Pascual nor his predecessors-in-interest possessed sufficient title to the subject
property, the same being a portion of the public domain and, therefore, it belongs to the Republic of the
Philippines. The Director of Forestry, through the Provincial Fiscal, similarly opposed Pascual's application for
the same reason as that advanced by the Director of Lands. Later on, however, the Director of Lands withdrew
his opposition. The Director of Forestry become the sole oppositor.

On June 2, 1960, the court a quo issued an order of general default excepting the Director of Lands and the
Director of Forestry.

Upon motion of Emiliano Navarro, however, the order of general default was lifted and, on February 13, 1961,
Navarro thereupon filed an opposition to Pascual's application. Navarro claimed that the land sought to be
registered has always been part of the public domain, it being a part of the foreshore of Manila Bay; that he was
a lessee and in possession of a part of the subject property by virtue of a fishpond permit issued by the Bureau
of Fisheries and confirmed by the Office of the President; and that he had already converted the area covered by
the lease into a fishpond.

During the pendency of the land registration case, that is, on November 6, 1960, Sinforoso Pascual filed a
complaint for ejectment against Emiliano Navarro, one Marcelo Lopez and their privies, alleged by Pascual to
have unlawfully claimed and possessed, through stealth, force and strategy, a portion of the subject property
covered by Plan Psu-175181. The defendants in the case were alleged to have built a provisional dike thereon:
thus they have thereby deprived Pascual of the premises sought to be registered. This, notwithstanding repeated
demands for defendants to vacate the property.

The case was decided adversely against Pascual. Thus, Pascual appealed to the Court of First Instance (now
Regional Trial Court) of Balanga, Bataan, the appeal having been docketed as Civil Case No. 2873. Because of
the similarity of the parties and the subject matter, the appealed case for ejectment was consolidated with the
land registration case and was jointly tried by the court a quo.

During the pendency of the trial of the consolidated cases, Emiliano Navarro died on November 1, 1961 and
was substituted by his heirs, the herein petitioners.

Subsequently, on August 26, 1962, Pascual died and was substituted by his heirs, the herein private respondents.

On November 10, 1975, the court a quo rendered judgment finding the subject property to be foreshore land
and, being a part of the public domain, it cannot be the subject of land registration proceedings.

The decision's dispositive portion reads:

"WHEREFORE, judgment is rendered:

(1) Dismissing plaintiff [private respondent] Sinforoso Pascual's complaint for ejectment in Civil Case No.
2873;

(2) Denying the application of Sinforoso Pascual for land registration over the land in question; and

(3) Directing said Sinforoso Pascual, through his heirs, as plaintiff in Civil Case No. 2873 and as applicant in
Land Registration Case No. N-84 to pay costs in both instances."[6]

The heirs of Pascual appealed and, before the respondent appellate court, assigned the following errors:

67
"1. The lower court erred in not finding the land in question as an accretion by the action of the Talisay and
Bulacan Rivers to the land admittedly owned by applicants-appellants [private respondents].

2. The lower court erred in holding that the land in question is foreshore land.

3. The lower court erred in not ordering the registration of the and is controversy in favor of applicants-
appellants [private respondents].

4. The lower court erred in not finding that the applicants-appellants [private respondents] are entitled to eject
the oppositor-appellee [petitioners]."[7]

On appeal, the respondent court reversed the findings of the court a quo and granted the petition for
registration of the subject property but excluding therefrom fifty (50) meters from corner 2 towards corner 1;
and fifty meters (50) meters from corner 5 towards corner 6 of the Psu-175181.
The respondent appellate court explained the reversal in this wise:

"The paramount issue to be resolved in this appeal as set forth by the parties in their respective briefs is whether
or not the land sought to be registered is accretion or foreshore land, or, whether or not said land was formed by
the action of the two rivers of Talisay and Bulacan or by the action of the Manila Bay. If formed by the action of
the Talisay and Bulacan rivers, the subject land is accretion but if formed by the action of the Manila Bay then it
is foreshore land.

xxx

It is undisputed that applicants-appellants [private respondents] owned the land immediately adjoining the land
sought to be registered. Their property which is covered by OCT No. 6830 is bounded on the east by the Talisay
River, on the west by the Bulacan River, and on the north by the Manila Bay. The Talisay and Bulacan rivers
come from inland flowing downstream towards the Manila Bay. In other words, between the Talisay River and
the Bulacan River is the property of applicants with both rivers acting as the boundary to said land and the flow
of both rivers meeting and emptying into the Manila Bay. The subject land was formed at the tip or apex of
appellants' [private respondents'] land adding thereto the land now sought to be registered.

This makes this case quite unique because while it is undisputed that the subject land is immediately attached to
appellants' [private respondents'] land and forms the tip thereof, at the same time, said land immediately faces
the Manila Bay which is part of the sea. We can understand therefore the confusion this case might have caused
the lower court, faced as it was with the uneasy problem of deciding whether or not the subject land was formed
by the action of the two rivers or by the action of the sea. Since the subject land is found at the shore of the
Manila Bay facing appellants' [private respondents'] land, it would be quite easy to conclude that it is foreshore
and therefore part of the patrimonial property of the State as the lower court did in fact rule x x x .

xxx

It is however undisputed that appellants' [private respondents'] land lies between these two rivers and it is
precisely appellants' [private respondents'] land which acts as a barricade preventing these two rivers to
meet. Thus, since the flow of the two rivers is downwards to the Manila Bay the sediments of sand and silt are
deposited at their mouths.

It is, therefore, difficult to see how the Manila Bay could have been the cause of the deposit thereat for in the
natural course of things, the waves of the sea eat the land on the shore, as they suge [sic] inland. It would not
therefore add anything to the land but instead subtract from it due to the action of the waves and the wind. It is
then more logical to believe that the two rivers flowing towards the bay emptied their cargo of sand, silt and
clay at their mouths, thus causing appellants' [private respondents'] land to accumulate therein.

68
However, our distinguished colleage [sic], Mr. Justice Serrano, do [sic] not seem to accept this theory and stated
that the subject land arose only when x x x Pascual planted 'palapat' and 'bakawan' trees thereat to serve as a
boundary or strainer. But we do not see how this act of planting trees by Pascual would explain how the land
mass came into being. Much less will it prove that the same came from the sea. Following Mr. Justice Serrano's
argument that it were the few trees that acted as strainers or blocks, then the land that grew would have stopped
at the place where the said trees were planted. But this is not so because the land mass went far beyond the
boundary, or where the trees were planted.

On the other hand, the picture-exhibits of appellants' [private respondents'] clearly show that the land that
accumulated beyond the so-called boundary, as well as the entire area being applied for is dry land, above sea
level, and bearing innumerable trees x x x. The existence of vegetation on the land could only confirm that the
soil thereat came from inland rather than from the sea, for what could the sea bring to the shore but sand,
pebbles, stones, rocks and corrals? On the other hand, the two rivers would be bringing soil on their downward
flow which they brought along from the eroded mountains, the lands along their path, and dumped them all on
the northern portion of appellants' [private respondents'] land.

In view of the foregoing, we have to deviate from the lower court's finding. While it is true that the subject land
is found at the shore of the Manila Bay fronting appellants' [private respondents'] land, said land is not foreshore
but an accretion from the action of the Talisay and Bulacan rivers. In fact, this is exactly what the Bureau of
Lands found out, as shown in the following report of the Acting Provincial Officer, Jesus M. Orozco, to wit:

'Upon ocular inspection of the land subject of this registration made on June 11, 1960, it was found out that the
said land is x x x sandwitched [sic] by two big rivers x x x These two rivers bring down considerable amount of
soil and sediments during floods every year thus raising the soil of the land adjoining the private property of the
applicant [private respondents]. About four-fifth [sic] of the area applied for is now dry land whereon are
planted palapat trees thickly growing thereon. It is the natural action of these two rivers that has caused the
formation of said land x x x subject of this registration case. It has been formed, therefore, by accretion. And
having been formed by accretion, the said land may be considered the private property of the riparian owner
who is the applicant herein [private respondents'] x x x .

In view of the above, the opposition hereto filed by the government should be withdrawn, except for the portion
recommended by the land investigator in his report dated May 2, 1960, to be excluded and considered
foreshore. x x x'

Because of this report, no less than the Solicitor General representing the Bureau of Lands withdrew his
opposition dated March 25, 1960, and limited 'the same to the northern portion of the land applied for,
compromising a strip 50 meters wide along the Manila Bay, which should be declared public land as part of the
foreshore' x x x.[8]

Pursuant to the aforecited decision, the respondent appellate court ordered the issuance of the corresponding
decree of registration in the name of private respondents and the reversion to private respondents of the
possession of the portion of the subject property included in Navarro's fishpond permit.
On December 20, 1978, petitioners filed a motion for reconsideration of the aforecited decision. The
Director of Forestry also moved for the reconsideration of the same decision. Both motions were opposed by
private respondents on January 27, 1979.
On November 21, 1980, respondent appellate court promulgated a resolution denying the motion for
reconsideration filed by the Director of Forestry. It, however, modified its decision, to read, viz:

"(3). Ordering private oppositors Heirs of Emiliano Navarro to vacate that portion included in their fishpond
permit covered by Plan Psu-175181 and hand over possession of said portion to applicants-appellants, if the
said portion is not within the strip of land fifty (50) meters wide along Manila Bay on the northern portion of
the land subject of the registration proceedings and which area is more particularly referred to as fifty (50)
69
meters from corner 2 towards corner 1; and fifty (50) meters from corner 5 towards corner 6 of Plan Psu-
175181. x x x[9]

On December 15, 1980, we granted the Solicitor General, acting as counsel for the Director of Forestry, an
extension of time within which to file in this court, a petition for review of the decision dated November 29,
1978 of the respondent appellate court and of the aforecited resolution dated November 21, 1980.
Thereafter, the Solicitor General, in behalf of the Director of Forestry, filed a petition for review entitled,
"The Director of Forestry vs. the Court of Appeals." [10] We, however, denied the same in a minute resolution
dated July 20, 1981, such petition having been prematurely filed at a time when the Court of Appeals was yet to
resolve petitioners' pending motion to set aside the resolution dated November 21, 1980.
On October 9, 1981, respondent appellate court denied petitioners' motion for reconsideration of the
decision dated November 29, 1978.
On October 17, 1981, respondent appellate court made an entry of judgment stating that the decision dated
November 29, 1978 had become final and executory as against herein petitioners as oppositors in L.R.C. Case
No. N-84 and Civil Case No. 2873 of the Court of First Instance (now the Regional Trial Court) of Balanga,
Bataan.
On October 26, 1981, a second motion for reconsideration of the decision dated November 29, 1978 was
filed by petitioners' new counsel.
On March 26, 1982, respondent appellate court issued a resolution granting petitioners' request for leave to
file a second motion for reconsideration.
On July 13, 1984, after hearing, respondent appellate court denied petitioners' second motion for
reconsideration on the ground that the same was filed out of time, citing Rule 52, Section 1 of the Rules of
Court which provides that a motion for reconsideration shall be made ex-parte and filed within fifteen (15) days
from the notice of the final order or judgment.
Hence this petition where the respondent appellate court is imputed to have palpably erred in appreciating
the facts of the case and to have gravely misapplied statutory and case law relating to accretion, specifically,
Article 457 of the Civil Code.
We find merit in the petition.
The disputed property was brought forth by both the withdrawal of the waters of Manila Bay and the
accretion formed on the exposed foreshore land by the action of the sea which brought soil and sand sediments
in turn trapped by the palapat and bakawan trees planted thereon by petitioner Sulpicio Pascual in 1948.
Anchoring their claim of ownership on Article 457 of the Civil Code, private respondents vigorously argue
that the disputed 14-hectare land is an accretion caused by the joint action of the Talisay and Bulacan Rivers
which run their course on the eastern and western boundaries, respectively, of private respondents' own tract of
land.
Accretion as a mode of acquiring property under said Article 457, requires the concurrence of the following
requisites: (1) that the accumulation of soil or sediment be gradual and imperceptible; (2) that it be the result of
the action of the waters of the river; and (3) that the land where the accretion takes place is adjacent to the bank
of the river.[11] Accretion is the process whereby the soil is deposited, while alluvium is the soil deposited on the
estate fronting the river bank;[12] the owner of such estate is called the riparian owner. Riparian owners are,
strictly speaking, distinct from littoral owners, the latter being owners of lands bordering the shore of the sea or
lake or other tidal waters.[13] The alluvium, by mandate of Article 457 of the Civil Code, is automatically owned
by the riparian owner from the moment the soil deposit can be seen [14] but is not automatically registered
property, hence, subject to acquisition through prescription by third persons.[15]
Private respondents' claim of ownership over the disputed property under the principle of accretion, is
misplaced.

70
 First, the title of private respondents' own tract of land reveals its northeastern boundary to be Manila
Bay. Private respondents' land, therefore, used to adjoin, border or front the Manila Bay and not any of the two
rivers whose torrential action, private respondents insist, is to account for the accretion on their land. In fact,
one of the private respondents, Sulpicio Pascual, testified in open court that the waves of Manila Bay used to hit
the disputed land being part of the bay's foreshore but, after he had planted palapat and bakawan trees thereon in
1948, the land began to rise.[16]
Moreover, there is no dispute as to the location of: (a) the disputed land; (b) private respondents' own tract
of land; (c) the Manila Bay; and, (d) the Talisay and Bulacan Rivers. Private respondents' own land lies between
the Talisay and Bulacan Rivers; in front of their land on the northern side lies now the disputed land where
before 1948, there lay the Manila Bay. If the accretion were to be attributed to the action of either or both of the
Talisay and Bulacan Rivers, the alluvium should have been deposited on either or both of the eastern and
western boundaries of private respondents' own tract of land, not on the northern portion thereof which is
adjacent to the Manila Bay. Clearly lacking, thus, is the third requisite of accretion, which is, that the alluvium
is deposited on the portion of claimant's land which is adjacent to the river bank.
Second, there is no dispute as to the fact that private respondents' own tract of land adjoins the Manila
Bay. Manila Bay is obviously not a river, and jurisprudence is already settled as to what kind of body of water
the Manila Bay is. It is to be remembered that we held that:

"Appellant next contends that x x x Manila Bay cannot be considered as a sea. We find said contention
untenable. A bay is part of the sea, being a mere indentation of the same:

'Bay. An opening into the land where the water is shut in on all sides except at the entrance; an inlet of the sea;
an arm of the sea, distinct from a river, a bending or curbing of the shore of the sea or of a lake.' 7 C.J. 1013-
1014."[17]

The disputed land, thus, is an accretion not on a river bank but on a sea bank, or on what used to be the
foreshore of Manila Bay which adjoined private respindents' own tract of land on the northern side. As such, the
applicable law is not Article 457 of the Civil Code but Article 4 of the Spanish Law of Waters of 1866.
The process by which the disputed land was formed, is not difficult to discern from the facts of the case. As
the trial court correctly observed:

"A perusal of the survey plan x x x of the land subject matter of these cases shows that on the eastern side, the
property is bounded by Talisay River, on the western side by Bulacan River, on the southern side by Lot 1436
and on the northern side by Manila Bay. It is not correct to state that the Talisay and Bulacan Rivers meet a
certain portion because the two rivers both flow towards Manila Bay. The Talisay River is straight while the
Bulacan River is a little bit meandering and there is no portion where the two rivers meet before they end up at
Manila Bay. The land which is adjacent to the property belonging to Pascual cannot be considered an accretion
[caused by the action of the two rivers].

Applicant Pascual x x x has not presented proofs to convince the Court that the land he has applied for
registration is the result of the settling down on his registered land of soil, earth or other deposits so as to be
rightfully be considered as an accretion [caused by the action of the two rivers]. Said Art. 457 finds no
applicability where the accretion must have been caused by action of the bay."[18]

The conclusion formed by the trial court on the basis of the foregoing observation is that the disputed land
is part of the foreshore of Manila Bay and therefore, part of the public domain. The respondent appellate court,
however, perceived the fact that petitioners' own land lies between the Talisay and Bulacan Rivers, to be basis to
conclude that the disputed land must be an accretion formed by the action of the two rivers because private
respondents' own land acted as a barricade preventing the two rivers to meet and that the current of the two
rivers carried sediments of sand and silt downwards to the Manila Bay which accumulated somehow to a 14-
hectare land. These conclusions, however, are fatally incongruous in the light of the one undisputed critical fact:
71
the accretion was deposited, not on either the eastern or western portion of private respondents' land where a
river each runs, but on the northern portion of petitioners' land which adjoins the Manila Bay. Worse, such
conclusions are further eroded of their practical logic and consonance with natural experience in the light of
Sulpicio Pascual's admission as to having planted palapat and bakawan trees on the northern boundary of their
own land. In amplification of this, plainly more reasonable and valid are Justice Mariano Serrano's observations
in his dissenting opinion when he stated that:

"As appellants' (titled) land x x x acts as a barricade that prevents the two rivers to meet, and considering the
wide expanse of the boundary between said land and the Manila Bay, measuring some 593.00 meters x x x it is
believed rather farfetched for the land in question to have been formed through 'sediments of sand and salt
[sic] . . . deposited at their [rivers'] mouths.' Moreover, if 'since the flow of the two rivers is downwards to the
Manila Bay the sediments of sand and silt are deposited at their mouths,' why then would the alleged cargo of
sand, silt and clay accumulate at the northern portion of appellants' titled land facing Manila Bay instead of
merely at the mouths and banks of these two rivers? That being the case, the accretion formed at said portion of
appellants' titled [land] was not caused by the current of the two rivers but by the action of the sea (Manila Bay)
into which the rivers empty.

The conclusion x x x is not supported by any reference to the evidence which, on the contrary, shows that the
disputed land was formed by the action of the sea. Thus, no less than Sulpicio Pascual, one of the heirs of the
original applicant, testified on cross-examination that the land in dispute was part of the shore and it was only in
1948 that he noticed that the land was beginning to get higher after he had planted trees thereon in 1948. x x x

x x x it is established that before 1948 sea water from the Manila Bay at high tide could reach as far as the dike
of appellants' fishpond within their titled property, which dike now separates this titled property from the land in
question. Even in 1948 when appellants had already planted palapat and bakawan trees in the land involved,
inasmuch as these trees were yet small, the waves of the sea could still reach the dike. This must be so because
in x x x the survey plan of the titled property approved in 1918, said titled land was bounded on the north by
Manila Bay. So Manila Bay was adjacent to it on the north. It was only after the planting of the aforesaid trees
in 1948 that the land in question began to rise or to get higher in elevation.

The trees planted by appellants in 1948 became a sort of strainer of the sea water and at the same time a kind of
block to the strained sediments from being carried back to the sea by the very waves that brought them to the
former shore at the end of the dike, which must have caused the shoreline to recede and dry up eventually
raising the former shore leading to the formation of the land in question."[19]

In other words, the combined and interactive effect of the planting of palapat and bakawan trees, the withdrawal
of the waters of Manila Bay eventually resulting in the drying up of its former foreshore, and the regular
torrential action of the waters of Manila Bay, is the formation of the disputed land on the northern boundary of
private respondents' own tract of land.

The disputed property is an accretion on a sea bank, Manila Bay being an inlet or an arm of the sea; as such, the
disputed property is, under Article 4 of the Spanish Law of Waters of 1866, part of the public domain.

At the outset, there is a need to distinguish between Manila Bay and Laguna de Bay.
While we held in the case of Ignacio v. Director of Lands and Valeriano[20] that Manila Bay is considered a
sea for purposes of determining which law on accretion is to be applied in multifarious situations, we have ruled
differently insofar as accretions on lands adjoining the Laguna de Bay are concerned.
In the cases of Government of the P.I v. Colegio de San Jose,[21] Republic v. Court of Appeals,[22] Republic v.
Alagad[23], and Meneses v. Court of Appeals,[24] we categorically ruled that Laguna de Bay is a lake the accretion
on which, by the mandate of Article 84 of the Spanish Law of Waters of 1866, belongs to the owner of the land
contiguous thereto.

72
 The instant controversy, however, brings a situation calling for the application of Article 4 of the Spanish
Law of Waters of 1866, the disputed land being an accretion on the foreshore of Manila Bay which is, for all
legal purposes, considered a sea.
Article 4 of the Spanish Law of Waters of August 3, 1866 provides as follows:

"Lands added to the shores by accretions and alluvial deposits caused by the action of the sea, form part of the
public domain. When they are no longer washed by the waters of the sea and are not necessary for purposes of
public utility, or for the establishment of special industries, or for the coast-guard service, the Government shall
declare them to be the property of the owners of the estates adjacent thereto and as increment thereof."

In the light of the aforecited vintage but still valid law, unequivocal is the public nature of the disputed land
in this controversy, the same being an accretion on a sea bank which, for all legal purposes, the foreshore of
Manila Bay is. As part of the public domain, the herein disputed land is intended for public uses, and "so long as
the land in litigation belongs to the national domain and is reserved for public uses, it is not capable of being
appropriated by any private person, except through express authorization granted in due form by a competent
authority."[25] Only the executive and possibly the legislative departments have the right and the power to make
the declaration that the lands so gained by action of the sea is no longer necessary for purposes of public utility
or for the cause of establishment of special industries or for coast guard services. [26] Petitioners utterly fail to
show that either the executive or legislative department has already declared the disputed land as qualified,
under Article 4 of the Spanish Law of Waters of 1866, to be the property of private respondents as owners of the
estates adjacent thereto.
WHEREFORE, the instant Petition for Review is hereby GRANTED.
The decision of the Intermediate Appellate Court (now Court of Appeals) in CA G.R. No. 59044-R dated
November 29, 1978 is hereby REVERSED and SET ASIDE. The resolution dated November 21, 1980 and
March 28, 1982, respectively, promulgated by the Intermediate Appellate Court are likewise REVERSED and
SET ASIDE.
The decision of the Court of First Instance (now the Regional Trial Court), Branch 1, Balanga, Bataan, is
hereby ORDERED REINSTATED. Costs against private respondents.
SO ORDERED.

73