G.R. No.
L-20851 September
3, 1966
JESUS AGUIRRE, petitioner,
vs.
VICTOR S. PHENG, in his capacity as
General Manager of the LEONORA &
COMPANY, and NATIONAL SHIPYARDS
AND STEEL
CORPORATION, respondents.
Sisenando Villaluz for petitioner.
M. C. Virata for respondent National
Shipyards and Steel Corporation.
BARRERA, J.:
Antecedents.On June 28, 1954, Vicente
Aldaba and Teresa V. Aldaba sold to Jesus
Aguirre a circular bolted steel tank with a
capacity of 5,000 gallons, for the sum of
P900.00, for which the latter delivered to
the sellers duly endorsed, Security Bank &
Trust Company check No. 281912, in the
amount of P900.00. Aguirre, however,
failed to, take physical possession of the
tank, having been prevented from doing
so by the municipal authorities of Los
Baos, Laguna (where the tank was
located), in view of the claim of ownership
being made by the Bureau of Public
Highways. It appears, however, that
Vicente and Teresa Aldaba again sold the
same tank on December 2, 1954 to
Zosimo Gabriel, for P900.000. Gabriel, in
turn, sold it to the Leonora & Company on
December 5, 1954, for P2,500.00. After
some alterations and improvements made
on the tank, Leonora & Company was able
to sell the tank to National Shipyards &
Steel Corporation (Nassco), for
P14,500.00. 1
Aguirre immediately filed with Nassco a
formal notice of his claim of ownership of
the tank, as a consequence of which,
payment of the purchase price to Leonora
& Company was suspended. Then, Aguirre
instituted Civil Case No. 24914 in the
Court of First Instance of Manila, against
Leonora & Company and the Aldabas, for
delivery to him of the tank, with damages.
On the other hand, because of the
suspension of payment of the purchase
price, Leonora & Company filed Civil Case
No. 27988, against the Nassco, praying for
the delivery of the purchase price of
P14,500.00, or the reimbursement of the
sum of P2,299.00 allegedly representing
the actual investment and expenses made
and incurred to put the tank in usable
condition. Jesus Aguirre intervened in this
proceeding. These two cases were jointly
heard by the trial court.
Thereafter, decision was rendered in Civil
Case No. 24914, the dispositive portion of
which reads as follows:
IN VIEW OF THE FOREGOING, the
Court hereby declares Jesus Aguirre
the absolute owner of the property
described in his complaint. The
subsequent sale made by
defendants Aldaba to Zosimo
Gabriel, the sale made by Zosimo
Gabriel to defendant Leonora and
Co.; and the sale made by
defendant Leonora and Co. to the
National Shipyards and Steel
Corporation, are hereby declared
null and void and of no effect.
Defendants Aldaba and Leonora
and Co. and the National Shipyards
and Steel Corporation, are hereby
ordered to deliver to plaintiff Jesus
Aguirre the tank in question. Failure
to make such delivery, defendant
National Shipyards and Steel
Corporation, in whose possession
the tank is at present, shall pay to
the said Jesus Aguirre the original
purchase price of the tank in the
amount of P900.00.
No appeal having been perfected on time,
this decision became final.
In Civil Case No. 27988, the court
rendered decision based on a stipulation
of facts by the parties, wherein the
existence of Civil Case No. 24914 was
admitted, the dispositive portion of which
provides:
IN VIEW OF THE FOREGOING
AGREEMENT, judgment is hereby
rendered as follows:
Intervenor Jesus Aguirre, as we
have already declared in Civil Case
No. 24914, is hereby adjudged
owner of the oil tank in question.
Defendant National Shipyards and
Steel Corporation is hereby ordered
to deliver to the said Jesus Aguirre
such tank, but in the event that
delivery is not possible, to pay to
Aguirre the purchase price of
P900.00, and to Leonora and Co.
the amount of P11,299.00 which
represents the costs of the
improvements made by the said
Leonora & Co.
In the event that the National
Shipyards and Steel Corporation
shall deliver the oil tank to Jesus
Aguirre as it is, the latter shall pay
to Leonora and Co. the amount of
P11,299.00 which, as already
stated, was spent by Leonora and
Co. for the improvement of the
tank.
From this decision, Aguirre perfected an
appeal to the Court of Appeals.
The present case.On January 9, 1963,
the Court of Appeals rendered decision
affirming the judgment of the lower court
in Civil Case No. 27988, to return to
intervenor Aguirre the sum of P900.00 in
case delivery of the tank to him will not be
possible
because this was all the amount
that Aguirre had parted with when
he purchased said tank. It was
Leonora & Co. who had 5 spent the
sum of P11,299.00 for the
rehabilitation of said tank and
against this amount Aguirre has no
rightful claim whatsoever. Of
course, in the event of delivery of
the tank to Aguirre as improved, it
would be just for him to reimburse
Leonora & Co. the sum of
P11,299.00. The trial court,
therefore, acted properly in
denying Aguirre's claim to be paid
the fair and reasonable value of the
tank as improved in case the same
could no longer be delivered to
him.
Aguirre filed the present petition for
review, alleging that the judgment of the
Court of Appeals, ordering the return to
him of the sum of P900.00 (when the
value of the property is at least
P14,500.00), nullifies the declaration of his
ownership of the tank. He contends that
under Article 440 of the Civil Code, his
ownership of the property entitles him to
everything that is produced thereby, or is
incorporated or attached thereto, either
naturally or artificially. Thus, he reiterates
the claim to the fair and reasonable value
of the tank at the time of its delivery to
Nassco which is P14,500.00.
It is clear that we have here a case of
accession by specification: Leonora and
Company, as purchaser acting in good
faith, spending P11,299.00 for the
reconditioning of the tank which is later
adjudged to belong to petitioner Aguirre.
There is no showing that without the
works made by Leonora & Company, the
tank in its original condition when Aguirre
paid P900.00 therefor, would command
the price of P14,500 which Nassco was
willing to pay. Although ordinarily,
therefore, Aguirre, as owner of the tank,
would be entitled to any accession
thereto, the rule is different where the
works or improvements or the accession
was made on the property by one who
acted in good faith.2 And, it is not
contended that the making of the
improvements and incurring of expenses
amounting to P11,299.00 by Leonora &
Company was done in bad faith.
Furthermore, to uphold petitioner's
contention that he is entitled to the sum of
P14,500.00 the price of the tank in its
present condition, would be to allow him
to enrich himself at the expense of
another. The lower courts, therefore, acted
correctly in ordering the reimbursement to
Leonora & Company of the expenses it
made on the tank.
It must also be remembered that the
judgment in Civil Case No. 24914 of the
Court of First Instance of Manila, wherein
Nassco was directed to pay to Aguirre the
of P900.00, in case delivery of the same
tank is no longer possible, has already
become final. This ruling cannot be
disregarded in the present proceeding
which involves the same parties and
practically the same issue, arising from
the same set of facts.
Nassco cannot also be compelled to pay
more than P14,500.00 for the tank, the bid
offered by Leonora & Company and
accepted by this buyer, and which must
be the actual market value of the property
at the time of its delivery to the latter. It
has nothing to do at all with the various
transactions or sales and the deprivation
of Aguirre's right to possession of the tank,
which culminated in this legal suit.
Wherefore finding no error in the decision
of the Court of Appeals under review, the
present petition is hereby dismissed, with
costs against the petitioner. So ordered.
G.R. No. 157447. April 29, 2005
NEMENCIO C. EVANGELISTA, PASCUAL
G. QUINTO, LUIS B. BUENA, EUSEBIA
V. TABLADA, CANUTO G. TISBE, DAVID
R. CARULLO, SOFONIAS E. COLEGADO,
FELIX B. BUENA, TORIBIO C.
EVANGELISTA, LEBRADA A. NICOLAS,
ALECIA J. RAMOS, MILA G. DE LOS
REYES, SALVADOR I. DE LA TORRE,
MOISES CRUZ, RUFINO INFANTE,
ALICIA ASTROLOGO, TRINIDAD
LUMIQUED, LUZMINIDA QUINIQUINI, &
TEODORA C. TEMERAS, Petitioners,
vs.
CARMELINO M.
SANTIAGO, Respondents.
DECISION
CHICO-NAZARIO, J.:
In this Petition for Review under Rule 45 of
the Rules of Court, petitioners pray for the
reversal of the Decision of the Court of
Appeals in CA-G.R. CV No.
64957,1 affirming the Order of the Regional
Trial Court (RTC) of San Mateo, Rizal,
Branch 77, in Civil Case No.
1220,2 dismissing petitioners Complaint
for declaration of nullity of Original
Certificate of Title (OCT) No. 670 and all
other titles emanating therefrom.
In their Complaint, petitioners alleged that
they occupied and possessed parcels of
land, located in Sitio Panayawan,
Barangay San Rafael, Montalban (now
Rodriquez), Province of Rizal (Subject
Property), by virtue of several Deeds of
Assignment, dated 15 April 1994 and 02
June 1994, executed by a certain Ismael
Favila y Rodriguez.3
According to the Deeds of Assignment, the
Subject Property was part of a vast tract of
land called "Hacienda Quibiga," which
extended to Paraaque, Las Pias,
Muntinlupa, Cavite, Batangas, Pasay,
Taguig, Makati, Pasig, Mandaluyong,
Quezon City, Caloocan, Bulacan, and Rizal;
awarded to Don Hermogenes Rodriguez by
the Queen of Spain and evidenced by a
Spanish title. Ismael Favila claimed to be
one of the heirs and successors-in-interest
of Don Hermogenes Rodriguez. Acting as
Attorney-in-Fact pursuant to a Special
Power of Attorney executed by his "mga
kapatid" on 25 February 1965, Ismael
Favila signed the aforementioned Deeds of
Assignment, assigning portions of the
Subject Property to the petitioners, each
portion measuring around 500 to 1,000
square meters, in exchange for the labor
and work done on the Subject Property by
the petitioners and their predecessors.4
Petitioners came by information that
respondent was planning to evict them
from the Subject Property. Two of the
petitioners had actually received notices
to vacate. Their investigations revealed
that the Subject Property was included in
Transfer Certificates of Titles (TCTs) No.
53028, No. 281660, No. N-39258 and No.
205270, all originating from OCT No. 670,
and now in the name of respondent.5
OCT No. 670 was issued in the name of
respondents mother, Isabel Manahan y
Francisco, and three other individuals,
pursuant to Decree No. 10248, dated 13
February 1913, in Case No. 8502 of the
Court of Land Registration of the Philippine
Islands. The whole property covered by
OCT No. 670 was subsequently
adjudicated in favor of Isabel Manahan
Santiago (formerly Isabel Manahan y
Francisco). Consequently, OCT No. 670
was cancelled and TCT No. T-53028 was
issued exclusively in the name of Isabel
Manahan Santiago. On 28 December
1968, Isabel Manahan Santiago executed a
Deed of Donation transferring the property
to her son, respondent herein, who
subsequently secured TCTs No. 281660,
No. N-39258 and No. 205270 in his own
name.6
Petitioners filed with the trial court, on 29
April 1996, an action for declaration of
nullity of respondents certificates of title
on the basis that OCT No. 670 was fake
and spurious. Among the defects of OCT
No. 670 pointed out by petitioners were
that: (1) OCT No. 670 was not signed by a
duly authorized officer; (2) Material data
therein were merely handwritten and in
different penmanships; (3) OCT No. 670
was not printed on the Official Form used
in 1913, the year it was issued; (4) It failed
to indicate the Survey Plan which was the
basis of the Technical Description of the
property covered by the title; (5) Decree
No. 10248 referred to in OCT No. 670 was
issued only on 11 April 1913, while OCT
No. 670 was issued earlier, on 13 February
1913; and (6) Decree No. 10248 was
issued over a property other than the one
described in OCT No. 670, although also
located in the Province of Rizal.7
Respondent filed his Answer with Prayer
for Preliminary Hearing on the Affirmative
Defenses on 03 July 1996. According to
respondent, "[t]he allegations in the
Complaint would readily and patently
show that the same are flimsy, fabricated,
malicious, without basis in law and in
fact"8
As an affirmative defense, respondent
claimed that the petitioners had no legal
capacity to file the Complaint, and thus,
the Complaint stated no cause of action.
Since OCT No. 670 was genuine and
authentic on its face, then OCT No. 670
and all of respondents land titles derived
therefrom, are incontrovertible,
indefeasible and conclusive against the
petitioners and the whole world.9
Citing the consolidated cases of Director of
Forestry, et al. v. Hon. Emmanuel M.
Muoz, et al. and Pinagcamaligan Indo-
Agro Development Corporation v. Hon.
Macario Peralta, Jr., et al., 10 respondent
argued that the Spanish title, on which
petitioners based their claim, was neither
indefeasible nor imprescriptible. Moreover,
Presidential Decree (P.D.) No. 892, which
took effect on 16 February 1976, required
all holders of Spanish titles or grants to
apply for registration of their lands under
Republic Act No. 496, otherwise known as
the Land Registration Act,11 within six
months from effectivity of the decree.
After the given period, Spanish titles could
no longer be used as evidence of land
ownership in any registration proceedings
under the Torrens System. 12
Respondent also raised the affirmative
defense of prescription. He pointed out
that any action against his certificates of
title already prescribed, especially with
regard to OCT No. 670, which was issued
in 1913 or more than 83 years prior to the
filing of the Complaint by the petitioners.
At the very least, respondent contended,
"it must be presumed that the questioned
land titles were issued by the public
officials concerned in the performance of
their regular duties and functions pursuant
to the law."13
Even assuming arguendo that the
petitioners entered and occupied the
Subject Property, they did so as mere
intruders, squatters and illegal occupants,
bereft of any right or interest, since the
Subject Property was already covered by
Torrens certificates of title in the name of
respondent and his predecessors-in-
interest.14
Lastly, respondent denied knowing the
petitioners, much less, threatening to evict
them. In fact, petitioners were not
included as defendants in Civil Case No.
783 entitled, "Carmelino M. Santiago v.
Remigio San Pascual, et al.," which
respondent instituted before the same trial
court against squatters occupying the
Subject Property. In its decision, dated 01
July 1992, the trial court held that "there is
no doubt that the plaintiff (respondent
herein) is the owner of the land involved in
this case on which the defendants have
built their houses and shanties"
Although the decision in Civil Case No. 783
was appealed to the Court of Appeals, it
had become final and executory for failure
of the defendants-appellants therein to file
their appellants brief.15
In the instant case, the trial court held a
preliminary hearing on the affirmative
defenses as prayed for by the respondent.
During said hearing, petitioners presented
their lone witness, Engineer Placido Naval,
a supposed expert on land registration
laws. In response to questions from
Honorable Judge Francisco C. Rodriguez of
the trial court, Engineer Naval answered
that a parcel of land titled illegally would
revert to the State if the Torrens title was
cancelled, and that it was the State,
through the Office of the Solicitor General,
that should file for the annulment or
cancellation of the title. Respondent, on
the other hand, did not present any
evidence but relied on all the pleadings
and documents he had so far submitted to
the trial court.16
After the preliminary hearing, the trial
court issued the questioned Order, dated
05 February 1999, dismissing petitioners
Complaint. Pertinent portions of the Order
of the trial court read:
After considering the testimonial and
documentary evidence presented, this
Court is inclined not to grant plaintiffs (sic)
prayer. Finding credence and giving weight
to plaintiffs (sic) lone but "expert witness",
it is crystal clear that, to quote:
1. "a parcel of land titled illegally will
revert to the State
2. it is the State who must file the
corresponding case of annulment of title
through the Office of the Solicitor General,
and
3. a land illegally titled in the name of
private individual, the State through the
Office of the Solicitor General should file
the corresponding case for cancellation of
title." (TSN August 26, 1997).
The above quoted testimony is straight
from horse (sic) mouth so to speak as this
was the testimony of the plaintiffs (sic)
expert witness. And judging from the said
testimony alone aforecited, plaintiffs (sic)
cause [of action] is bound to fail. "Plaintiffs
(sic) own testimony" wrote "finis" to their
case. From the record, this case was
initiated and filed by private individuals,
Nemencio Evangelista, et. al.,
contradicting their witness (sic) testimony.
To reiterate, this Court finds credence to
the testimony of the plaintiffs (sic)
witness, i.e., is (sic) the State through the
Office of the Solicitor General who must
initiate and file a case of this nature when
title to a land is being claimed to be
obtained through fraud and allegedly
spurious.
The opinion of this Court anent the
testimony of the witness is not without
basis. Explicit is the pronouncement of the
Supreme Court in the recent case of Heirs
of Marciano Nagano v. Court of Appeals, to
wit:
An action for reversion has to be instituted
by the Solicitor General pursuant to
Section 101, Commonwealth Act No. 141.
(282 SCRA 43).
As to the documentary evidence, having
gone through with the "Deed of
Assignment/s" purportedly executed by
and between a certain Ismael Favila y
Rodriguez and the plaintiffs, which is the
principal if not the only basis of plaintiffs
claim ownership and possession of the
subject parcel of land, the same does not
hold water in a manner of speaking, for
being self-serving. "Assignor Ismael Favila
y Rodriguez" claimed in said Deed that he
is the Attorney-in-Fact by virtue of an
alleged Special Power of Attorney
executed in his favor by his "mga kapatid"
on February 23, 1965, but said Special
Power of Attorney was not presented
before this Court, thus there arises a
doubt as to its existence and execution
not to mention doubt on the existence of
his "mga kapatid" who as alleged
executed said Special Power Attorney (sic)
in his favor.
Even if this Court granting arguendo would
admit the authenticity of said "Deeds of
Assignment/s", that will not alter the
outcome of the pending incident/s before
this Court. Why? Because the said "Deed
of Assignment/s" which were based on
Spanish title have lost their evidentiary
value pursuant to the Presidential Decree
No. 892 i.e. "DISCONTINUANCE OF THE
SPANISH MORTGAGE SYSTEM OF
REGISTRATION AND OF THE USE OF
SPANISH TITLES AS EVIDENCE IN LAND
REGISTRATION PROCEEDINGS."
There is no need to elaborate on the
above-cited provisions of PD 892 as they
are self-explanatory. Suffice it to say that
there is no showing that plaintiffs
complied with the said law i.e. to apply
for registration of their lands under Act No.
496, otherwise known as the Land
Registration Act, within six (6) months
from the effectivity of this decree
(February 16, 1976) Thereafter, Spanish
titles cannot be used as evidence of land
ownership in any registration proceedings
under the Torrens System."
This being the case and likewise being
clear that plaintiffs were not the lawful
owners of the land subject of this case, for
they did not comply with PD 892, the said
plaintiffs do not have the legal standing to
bring before this Court the instant
complaint
Moreover, the principal issue in this case is
for the declaration of nullity of defendants
title, which has nothing to do with
plaintiffs (sic) claim of ownership and
possession even if we set aside, albeit
momentarily, the truth that plaintiffs (sic)
claim were based on barred Spanish
Title/s, and thus plaintiffs were never the
owners of the parcel of land subject of this
case.
Further, defendants (sic) title especially so
with the mother title OCT 670 was entered
and issued in 1913 or more than Eighty
Three (83) years ago, the same not having
been questioned by any party. Only now
that it is being questioned, but sad to say,
plaintiffs who are on the offensive and
relying on their lone expert witness,
instead of bolstering their case,
unwittingly sealed their fate 17
After the trial court denied petitioners
Motion for Reconsideration in its Order,
dated 20 July 1999,18 petitioners appealed
both Orders of the trial court to the Court
of Appeals.
The Court of Appeals, in its Decision,
dated 29 July 2002,19 affirmed the Order of
the trial court, dated 05 February 1999,
dismissing petitioners Complaint. The
Court of Appeals denied petitioners
Motion for Reconsideration in its
Resolution, dated 14 February 2003.20
Thus, petitioners filed this Petition for
Review 21 under Rule 45 of the Rules of
Court, raising the following issues and
praying for the reversal of the
aforementioned Decision of the Court of
Appeals affirming the Order of dismissal of
the trial court:
I. Whether the lower courts
dismissal of the petitioners
complaint should be proscribed
by the rules of evidence it being
based inter alia on Engr. Navals
testimony, which was
indisputably not based on facts
but conclusion of law.
II. Whether the lower courts
dismissal of petitioners
complaint should be proscribed
by the rules of evidence it being
done sans ample evidence
except bare allegations of
respondent.
III. Whether the provision of P.D.
892, i.e., Spanish titles cannot
be used as evidence of land
ownership in any registration
proceedings under the Torrens
system, holds of an exception.
IV. Whether an action for quieting
of title, specifically where
petitioners are in possession of
subject land, can be subject of
prescription.
In his Comment,22 the respondent, for the
most part, reiterated the findings of the
trial court and the Court of Appeals.
The Court believes that the trial court
rightfully dismissed petitioners Complaint,
but for reasons different from those relied
upon by the trial court and the Court of
Appeals.
According to the respondent, petitioners
had no legal capacity to file the Complaint,
and thus, the Complaint filed before the
trial court stated no cause of action.
Before anything else, it should be clarified
that "the plaintiff has no legal capacity to
sue"23 and "the pleading asserting the
claim states no cause of action"24 are two
different grounds for a motion to dismiss
or are two different affirmative defenses.
Failure to distinguish between "the lack of
legal capacity to sue" from "the lack of
personality to sue" is a fairly common
mistake. The difference between the two is
explained by this Court in Columbia
Pictures, Inc. v. Court of Appeals:25
Among the grounds for a motion to
dismiss under the Rules of Court are lack
of legal capacity to sue and that the
complaint states no cause of action. Lack
of legal capacity to sue means that the
plaintiff is not in the exercise of his civil
rights, or does not have the necessary
qualification to appear in the case, or does
not have the character or representation
he claims. On the other hand, a case is
dismissible for lack of personality to sue
upon proof that the plaintiff is not the real
party-in-interest, hence grounded on
failure to state a cause of action. The term
"lack of capacity to sue" should not be
confused with the term "lack of personality
to sue." While the former refers to a
plaintiffs general disability to sue, such as
on account of minority, insanity,
incompetence, lack of juridical personality
or any other general disqualifications of a
party, the latter refers to the fact that the
plaintiff is not the real party- in-interest.
Correspondingly, the first can be a ground
for a motion to dismiss based on the
ground of lack of legal capacity to sue;
whereas the second can be used as a
ground for a motion to dismiss based on
the fact that the complaint, on the face
thereof, evidently states no cause of
action.
In the present case, this Court may
assume that the respondent is raising the
affirmative defense that the Complaint
filed by the petitioners before the trial
court stated no cause of action because
the petitioners lacked the personality to
sue, not being the real party-in-interest. It
is the respondents contention that only
the State can file an action for annulment
of his certificates of title, since such an
action will result in the reversion of the
ownership of the Subject Property to the
State.
The affirmative defense that the
Complaint stated no cause of action,
similar to a motion to dismiss based on
the same ground, requires
a hypothetical admission of the facts
alleged in the Complaint. In the case
of Garcon v. Redemptorist Fathers,26 this
Court laid down the rules as far as this
ground for dismissal of an action or
affirmative defense is concerned:
It is already well-settled by now that, in a
motion to dismiss a complaint based on
lack of cause of action, the question
submitted to the court for determination is
the sufficiency of the allegations of fact
made in the complaint to constitute a
cause of action, and not on whether these
allegations of fact are true, for said motion
must hypothetically admit the truth of the
facts alleged in the complaint; that the
test of the sufficiency of the facts alleged
in the complaint is whether or not,
admitting the facts alleged, the court
could render a valid judgment upon the
same in accordance with the prayer of
said complaint. Stated otherwise, the
insufficiency of the cause of action must
appear in the face of the complaint in
order to sustain a dismissal on this
ground, for in the determination of
whether or not a complaint states a cause
of action, only the facts alleged therein
and no other matter may be considered,
and the court may not inquire into the
truth of the allegations, and find them to
be false before a hearing is had on the
merits of the case; and it is improper to
inject in the allegations of the complaint
facts not alleged or proved, and use these
as basis for said motion.
In resolving whether or not the Complaint
in the present case stated a cause of
action, the trial court should have limited
itself to examining the sufficiency of the
allegations in the Complaint. It was
proscribed from inquiring into the truth of
the allegations in the Complaint or the
authenticity of any of the documents
referred or attached to the Complaint,
since these are deemed hypothetically
admitted by the respondent. The trial
court evidently erred in making findings as
to the authenticity of the Deeds of
Assignment executed by Ismael Favila in
favor of petitioners on 15 April 1994 and
02 June 1994; and questioning the
existence and execution of the Special
Power of Attorney in favor of said Ismael
Favila by his siblings on 25 February 1965.
These matters may only be resolved after
a proper trial on the merits.
Petitioners alleged in their Complaint, and
respondent hypothetically admitted that:
(1) Petitioners predecessors-in-interest, in
the concept of owners, had been in actual,
physical, open, continuous and adverse
possession of the Subject Property against
the whole world since time immemorial;
(2) The Subject Property was part of the
vast tract of land called "Hacienda
Quibiga" awarded to Don Hermogenes
Rodriguez by the Queen of Spain by virtue
of a Spanish title; (3) Ismael Favila, an heir
and successor-in-interest of Don
Hermogenes Rodriguez, acting as
Attorney-in-Fact pursuant to a Special
Power of Attorney executed by his "mga
kapatid" on 25 February 1965, executed
Deeds of Assignment covering the Subject
Property in favor of petitioners; (4)
Petitioners still occupied and possessed
the Subject Property, on which their
houses were erected, when they
discovered that the Subject Property was
already covered by Torrens certificates of
title in the name of respondent; and (5)
That petitioners filed the Complaint to
prevent their eviction by the respondent.
To determine whether these allegations
are sufficient to constitute a cause of
action, it is important for this Court to
establish first the nature of petitioners
action.
Indeed, petitioners Complaint filed before
the trial court was captioned as an action
for declaration of nullity of respondents
certificates of title. However, the caption
of the pleading should not be the
governing factor, but rather the
allegations therein should determine the
nature of the action, because even without
the prayer for a specific remedy, the
courts may nevertheless grant the proper
relief as may be warranted by the facts
alleged in the Complaint and the evidence
introduced.27
The trial court believed that petitioners
action was ultimately one for reversion of
the Subject Property to the public domain.
Based on the testimony of Engineer Naval
and the case of Nagao v. Court of
Appeals,28 it declared that the State,
represented by the Office of the Solicitor
General, is the party-in-interest in an
action for cancellation of a certificate of
title illegally issued in the name of a
private individual, because the eventual
effect of such cancellation is the reversion
of the property to the State.
The Court disagrees in this
pronouncement of the trial court, and calls
for a far closer review of its decision
in Nagao v. Court of Appeals,29 wherein
the Court held that
It is then clear from the allegations in the
complaint that private respondents claim
ownership of the 2,250 square meter
portion for having possessed it in the
concept of an owner, openly, peacefully,
publicly, continuously and adversely since
1920. This claim is an assertion that the
lot is private land, or that even assuming it
was part of the public domain, private
respondents had already acquired
imperfect title thereto under Section 48(b)
of C.A. No. 141, otherwise known as the
Public Land Act, as amended by R.A. No.
1942
Under Section 48, a subject lot is, for all
legal intents and purposes, segregated
from the public domain, because the
beneficiary is "conclusively presumed to
have performed all the conditions
essential to a Government grant and shall
be entitled to a certificate of title under
the provisions of this chapter."
Consequently, merely on the basis of the
allegations in the complaint, the lot in
question is apparently beyond the
jurisdiction of the Director of the Bureau of
Lands and could not be the subject of a
Free Patent. Hence, dismissal of private
respondents complaint was premature
and trial on the merits should have been
conducted to thresh out evidentiary
matters.
It would have been entirely different if the
action were clearly for reversion, in which
case, it would have to be instituted by the
Solicitor General pursuant to Section 101
of C.A. No. 141, which provides:
Sec. 101. All actions for the reversion to
the Government of lands of the public
domain or improvements thereon shall be
instituted by the Solicitor General or the
officer acting in his stead, in the proper
courts, in the name of the [Republic] of
the Philippines.
In the more recent case of Heirs of
Ambrocio Kionisala v. Heirs of Honorio
Dacut,30 the difference between an action
for declaration of nullity of land titles from
an action for reversion was more
thoroughly discussed as follows:
An ordinary civil action for declaration of
nullity of free patents and certificates of
title is not the same as an action for
reversion. The difference between them
lies in the allegations as to the character
of ownership of the realty whose title is
sought to be nullified. In an action for
reversion, the pertinent allegations in the
complaint would admit State ownership of
the disputed land. Hence, in Gabila vs.
Barriga [41 SCRA 131], where the plaintiff
in his complaint admits that he has no
right to demand the cancellation or
amendment of the defendants title
because even if the title were canceled or
amended the ownership of the land
embraced therein or of the portion
affected by the amendment would revert
to the public domain, we ruled that the
action was for reversion and that the only
person or entity entitled to relief would be
the Director of Lands.
On the other hand, a cause of action for
declaration of nullity of free patent and
certificate of title would require allegations
of the plaintiffs ownership of the
contested lot prior to the issuance of such
free patent and certificate of title as well
as the defendants fraud or mistake, as
the case may be, in successfully obtaining
these documents of title over the parcel of
land claimed by plaintiff. In such a case,
the nullity arises strictly not from the fraud
or deceit but from the fact that the land is
beyond the jurisdiction of the Bureau of
Lands to bestow and whatever patent or
certificate of title obtained therefore is
consequently void ab initio. The real party-
in-interest is not the State but the plaintiff
who alleges a pre-existing right of
ownership over the parcel of land in
question even before the grant of title to
the defendant
In their Complaint, petitioners never
alleged that the Subject Property was part
of the public domain. On the contrary,
petitioners asserted title over the Subject
Property by virtue of their actual, physical,
open, continuous and adverse possession
thereof, in the concept of owners, by
themselves and through their
predecessors-in-interest, since time
immemorial. The Deeds of Assignment
executed in their favor and attached to
their Complaint referred to a Spanish title
granted by the Queen of Spain to their
predecessor-in-interest, Don Hermogenes
Rodriguez. Clearly, petitioners are
asserting private title over the Subject
Property, and consequently, their action
could not be one for reversion.
In their instant Petition, petitioners further
averred that rather than an action for
nullity of respondents certificates of title,
theirs was more appropriately an action to
remove a cloud on or to quiet their title
over the Subject Property.
Article 476 of the Civil Code, on removal of
a cloud on or quieting of title, provides
that:
Art. 476. Whenever there is a cloud on
title to real property or any interest
therein, by reason of any instrument,
record, claim, encumbrance or proceeding
which is apparently valid or effective but is
in truth and in fact invalid, ineffective,
voidable, or unenforceable, and may be
prejudicial to said title, an action may be
brought to remove such cloud or to quiet
the title.
An action may also be brought to prevent
a cloud from being cast upon title to real
property or any interest therein.
Respondents certificates of title over the
Subject Property appeared valid or
effective; but according to the petitioners,
they were fake, spurious and/or
fraudulent, and a cloud on their title to the
same property that needed to be
removed. A cloud on title has been defined
as follows:
Cloud on Title. A cloud on title is an
outstanding instrument, record, claim,
encumbrance or proceeding which is
actually invalid or inoperative, but which
may nevertheless impair or affect
injuriously the title to property. The matter
complained of must have a prima facie
appearance of validity or legal efficacy.
The cloud on title is a semblance of title
which appears in some legal form but
which is in fact unfounded. The invalidity
or inoperativeness of the instrument is not
apparent on the face of such instrument,
and it has to be proved by extrinsic
evidence31
Even as this Court agrees with the
petitioners that their action was one for
removal of a cloud on or quieting of title, it
does arrive at the same conclusion as the
trial court and the Court of Appeals that
petitioners had no personality to file the
said action, not being the parties-in-
interest, and their Complaint should be
dismissed for not stating a cause of action.
According to Article 477 of the Civil Code,
the plaintiff, in an action to remove a
cloud on or to quiet title, must have legal
or equitable title to, or interest in, the real
property which is the subject matter of the
action.32 Petitioners failed to establish in
their Complaint that they had any legal or
equitable title to, or legitimate interest in,
the Subject Property so as to justify their
right to file an action to remove a cloud on
or to quiet title.
Title to real property refers to that upon
which ownership is based. It is the
evidence of the right of the owner or the
extent of his interest, by which means he
can maintain control and, as a rule, assert
right to exclusive possession and
enjoyment of the property.33
In their Complaint, petitioners claimed title
to the Subject Property by virtue of their
actual and continuous possession of the
same since time immemorial, by
themselves and through their
predecessors-in-interest. Yet, the Deeds of
Assignment executed by Ismael Favila in
their favor, attached to and an integral
part of their Complaint, revealed that
petitioners predecessors-in-interest based
their right to the Subject Property on the
Spanish title awarded to Don Hermogenes
Rodriguez.
There existed a contradiction when
petitioners based their claim of title to the
Subject Property on their possession
thereof since time immemorial, and at the
same time, on the Spanish title granted to
Don Hermogenes Rodriguez. Possession
since time immemorial carried the
presumption that the land had never
been part of the public domain or
that it had been private property
even before the Spanish conquest. 34 If
the Subject Property was already private
property before the Spanish conquest,
then it would have been beyond the power
of the Queen of Spain to award or grant to
anyone.
The title to and possession of the Subject
Property by petitioners predecessors-in-
interest could be traced only as far back
as the Spanish title of Don Hermogenes
Rodriguez. Petitioners, having acquired
portions of the Subject Property by
assignment, could acquire no better title
to the said portions than their
predecessors-in-interest, and hence, their
title can only be based on the same
Spanish title.
Respondent maintained that P.D. No. 892
prevents petitioners from invoking the
Spanish title as basis of their ownership of
the Subject Property. P.D. No. 892
strengthens the Torrens system by
discontinuing the system of registration
under the Spanish Mortgage Law, and by
categorically declaring all lands recorded
under the latter system, not yet covered
by Torrens title, unregistered lands. It
further provides that within six months
from its effectivity, all holders of Spanish
titles or grants should apply for
registration of their land under what is
now P.D. No. 1529, otherwise known as the
Land Registration Decree. Thereafter,
Spanish titles can no longer be used as
evidence of land ownership in any
registration proceedings under the Torrens
system. 35 Indubitably, P.D. No. 892 divests
the Spanish titles of any legal force and
effect in establishing ownership over real
property.
P.D. No. 892 became effective on 16
February 1976. The successors of Don
Hermogenes Rodriguez had only until 14
August 1976 to apply for a Torrens title in
their name covering the Subject Property.
In the absence of an allegation in
petitioners Complaint that petitioners
predecessors-in-interest complied with P.D.
No. 892, then it could be assumed that
they failed to do so. Since they failed to
comply with P.D. No. 892, then the
successors of Don Hermogenes Rodriguez
were already enjoined from presenting the
Spanish title as proof of their ownership of
the Subject Property in registration
proceedings.
Registration proceedings under the Torrens
system do not create or vest title, but only
confirm and record title already created
and vested.36 By virtue of P.D. No. 892, the
courts, in registration proceedings under
the Torrens system, are precluded from
accepting, confirming and recording a
Spanish title. Reason therefore dictates
that courts, likewise, are prevented from
accepting and indirectly confirming such
Spanish title in some other form of action
brought before them (i.e., removal of
cloud on or quieting of title), only short of
ordering its recording or registration. To
rule otherwise would open the doors to the
circumvention of P.D. No. 892, and give
rise to the existence of land titles,
recognized and affirmed by the courts, but
would never be recorded under the Torrens
system of registration. This would
definitely undermine the Torrens system
and cause confusion and instability in
property ownership that P.D. No. 892
intended to eliminate.
Petitioners argued that the Spanish title
may still be presented as proof of
ownership on the basis of the exception
provided in the fourth whereas clause of
P.D. No. 892, which reads:
WHEREAS, Spanish titles to lands which
have not yet been brought under the
operation of the Torrens system, being
subject to prescription, are now ineffective
to prove ownership unless accompanied
by proof of actual possession; . . .
Since Petitioners alleged that they were in
actual possession of the Subject Property,
then they could still present the Spanish
title as evidence of their ownership of the
Subject Property. 37
This Court cannot sustain petitioners
argument. Actual proof of possession only
becomes necessary because, as the same
whereas clause points out, Spanish titles
are subject to prescription. A holder of a
Spanish title may still lose his ownership of
the real property to the occupant who
actually possesses the same for the
required prescriptive period.38 Because of
this inherent weakness of a Spanish title,
the applicant for registration of his
Spanish title under the Torrens system
must also submit proof that he is in actual
possession of the real property, so as to
discount the possibility that someone else
has acquired a better title to the same
property by virtue of prescription.
Moreover, legislative intent must be
ascertained from a consideration of the
statute as a whole, and not just a
particular provision alone. A word or
phrase taken in the abstract may easily
convey a meaning quite different from the
one actually intended and evident when
the word or phrase is considered with
those with which it is associated. An
apparently general provision may have a
limited application if read together with
other provisions of the statute.39
The fourth whereas clause of P.D. No. 892
should be interpreted and harmonized
with the other provisions of the whole
statute.40 Note that the tenor of the whole
presidential decree is to discontinue the
use of Spanish titles and to strip them of
any probative value as evidence of
ownership. It had clearly set a deadline for
the filing of applications for registration
of all Spanish titles under the Torrens
system (i.e., six months from its effectivity
or on 14 August 1976), after which, the
Spanish titles may no longer be presented
to prove ownership.
All holders of Spanish titles should have
filed applications for registration of their
title on or before 14 August 1976. In a
land registration proceeding, the applicant
should present to the court his Spanish
title plus proof of actual possession of the
real property. However, if such land
registration proceeding was filed and
initiated after 14 August 1976, the
applicant could no longer present his
Spanish title to the court to evidence his
ownership of the real property, regardless
of whether the real property was in his
actual possession.
Therefore, the fact that petitioners were in
actual possession of the Subject Property
when they filed the Complaint with the
trial court on 29 April 1996 does not
exclude them from the application of P.D.
No. 892, and their Spanish title remain
inadmissible as evidence of their
ownership of the Subject Property,
whether in a land registration proceeding
or in an action to remove a cloud on or to
quiet title.
The preceding discussion does not bar
holders of Spanish titles from claiming
ownership of the real property on some
other basis, such as those provided in
either the Land Registration Decree 41 or
the Public Land Act.42Petitioners though
failed to allege any other basis for their
titles in their Complaint aside from
possession of the Subject Property from
time immemorial, which this Court has
already controverted; and the Spanish
title, which is already ineffective to prove
ownership over the Subject Property.
Therefore, without legal or equitable title
to the Subject Property, the petitioners
lacked the personality to file an action for
removal of a cloud on, or quieting of, title
and their Complaint was properly
dismissed for failing to state a cause of
action. In view of the dismissal of the case
on this ground, it is already unnecessary
for this Court to address the issue of
prescription of the action.
Wherefore, this Court DENIES the instant
petition and AFFIRMS the Decision of the
Court of Appeals, dated 29 July 2002, and
the Order of the Regional Trial Court of San
Mateo, Rizal, Branch 77, dated 05
February 1999, dismissing petitioners
Complaint for failure to state a cause of
action.
SO ORDERED.
G.R. No. 167391 June 8, 2011
PHIL-VILLE DEVELOPMENT AND
HOUSING CORPORATION, Petitioner,
vs.
MAXIMO BONIFACIO, CEFERINO R.
BONIFACIO, APOLONIO B. TAN, BENITA
B. CAINA, CRISPINA B. PASCUAL,
ROSALIA B. DE GRACIA, TERESITA S.
DORONIA, CHRISTINA GOCO AND
ARSENIO C. BONIFACIO, in their
capacity as the surviving heirs of the
late ELEUTERIA RIVERA VDA. DE
BONIFACIO,Respondents.
VILLARAMA, JR., J.:
This petition for review on certiorari 1 seeks
to set aside the Decision2 dated January
31, 2005 and Resolution3dated March 15,
2005 of the Court of Appeals in CA-G.R. SP
No. 62211. The Court of Appeals dismissed
the Complaint4 for Quieting of Title and
Damages filed by Phil-Ville Development
and Housing Corporation (Phil-Ville) and
denied its Motion for Reconsideration.5
The factual antecedents, as culled from
the records, are as follows.
Phil-Ville Development and Housing
Corporation is the registered owner of
three parcels of land designated as Lots 1-
G-1, 1-G-2 and 1-G-3 of the subdivision
plan Psd-1-13-006209, located in Caloocan
City, having a total area of 8,694 square
meters and covered by Transfer
Certificates of Title (TCT) Nos.
270921,6 2709227 and 270923.8 Prior to
their subdivision, the lots were collectively
designated as Lot 1-G of the subdivision
plan Psd-2731 registered in the name of
Phil-Ville under TCT No. T-148220. 9 Said
parcels of land form part of Lot 23-A of the
Maysilo Estate originally covered by
Original Certificate of Title (OCT) No.
99410 registered on May 3, 1917 in the
name of Isabel Gil de Sola as the judicial
administratrix of the estate of Gonzalo
Tuason and thirty-one (31) others. Phil-Ville
acquired the lots by purchase from N. Dela
Merced and Sons, Inc. on July 24, 1984.
Earlier, on September 27, 1961, a group
composed of Eleuteria Rivera, Bartolome
P. Rivera, Josefa R. Aquino, Gregorio R.
Aquino, Pelagia R. Angeles, Modesta R.
Angeles, Venancio R. Angeles, Felipe R.
Angeles Fidela R. Angeles and Rosauro R.
Aquino, claiming to be the heirs of Maria
de la Concepcion Vidal, a co-owner to the
extent of 1-189/1000% of the properties
covered by OCT Nos. 982, 983, 984, 985
and 994 of the Hacienda Maysilo, filed a
petition with the Court of First Instance
(CFI) of Rizal in Land Registration Case No.
4557. They prayed for the substitution of
their names on OCT No. 994 in place of
Maria de la Concepcion Vidal. Said petition
was granted by the CFI in an Order11 dated
May 25, 1962.
Afterwards, the alleged heirs of Maria de la
Concepcion Vidal filed a petition for the
partition of the properties covered by OCT
Nos. 982, 983, 984, 985 and 994. The case
was docketed as Civil Case No. C-424 in
the CFI of Rizal, Branch 12, Caloocan City.
On December 29, 1965, the CFI granted
the petition and appointed three
commissioners to determine the most
equitable division of the properties.12 Said
commissioners, however, failed to submit
a recommendation.
Thirty-one (31) years later, on May 22,
1996, Eleuteria Rivera filed a On April 29, 1997, the Court of Appeals
Supplemental Motion13 in Civil Case No. C-
424, for the partition and segregation of
portions of the properties covered by OCT
No. 994. The Regional Trial Court (RTC),
Branch 120, of Caloocan City, through
Judge Jaime D. Discaya, to whom the case
was transferred, granted said motion. In
an Order14 dated September 9, 1996,
Judge Discaya directed the segregation of
portions of Lots 23, 28-A-1 and 28-A-2 and
ordered the Register of Deeds of Caloocan
City to issue to Eleuteria Rivera new
certificates of title over them. Three days
later, the Register of Deeds of Caloocan,
Yolanda O. Alfonso, issued to Eleuteria
Rivera TCT No. C-31453715 covering a
portion of Lot 23 with an area of 14,391.54
square meters. On December 12, 1996,
the trial court issued another Order
directing the acting Branch Clerk to issue
a Certificate of Finality of the Order dated
September 9, 1996.
Thereafter, one Rosauro R. Aquino filed a
petition for certiorari contesting said Order
of December 12, 1996 and impugning the
partial partition and adjudication to
Eleuteria Rivera of Lots 23, 28-A-1 and 28-
A-2 of the Maysilo Estate. The case was
docketed as CA-G.R. SP No. 43034 at the
Court of Appeals.
Meanwhile, a writ of possession 16 was
issued in Eleuteria Riveras favor on
December 26, 1996 upon the Order17of
Judge Discaya issued on the same date.
Accordingly, Sheriff Cesar L. Cruz served a
Notice to Vacate18 dated January 2, 1997
upon Phil-Ville, requiring it to vacate Lots
23-A and 28. Bonifacio Shopping Center,
Inc., which occupied Lot 28-A-2, was also
served a copy of the notice. Aggrieved,
Bonifacio Shopping Center, Inc. filed a
petition for certiorari and prohibition,
docketed as CA-G.R. SP No. 43009, before
the Court of Appeals. In a Decision19 dated
February 19, 1997, the appellate court set
aside and declared as void the Order and
Writ of Possession dated December 26,
1996 and the Notice to Vacate dated
January 2, 1997. The appellate court
explained that a party who has not been
impleaded in a case cannot be bound by a
writ of possession issued in connection
therewith.
Subsequently, on February 22, 1997,
Eleuteria Rivera Vda. de Bonifacio died at
the age of 96.20
On April 23, 1997, the Secretary of Justice
issued Department Order No. 137 creating
a special committee to investigate the
circumstances surrounding the issuance of
OCT No. 994 and its derivative titles.
rendered a Decision21 in CA-G.R. SP No.
43034 granting Rosauro R. Aquinos
petition and setting aside the RTCs Order
of September 9, 1996, which granted
Eleuteria Riveras prayer for partition and
adjudicated in her favor portions of Lots
23, 28-A-1 and 28-A-2 of the Maysilo
Estate. The appellate court likewise set
aside the Order and the Writ of Possession
dated December 26, 1996.
Nonetheless, on June 5, 1997, petitioner
filed a complaint for quieting of title and
damages against the surviving heirs of
Eleuteria Rivera Vda. de Bonifacio (namely
Maximo R. Bonifacio, Ceferino R. Bonifacio,
Apolonia B. Tan, Benita B. Caina, Crispina
B. Pascual, Rosalia B. de Gracia, Teresita S.
Doronia, Christina B. Goco, Arsenio C.
Bonifacio, Carmen B. Bernardino and
Danilo C. Bonifacio) and the Register of
Deeds of Caloocan City. The case was
docketed as Civil Case No. C-507 in the
RTC of Caloocan City, Branch 122.
On October 7, 1997, then Senator Marcelo
B. Fernan filed P.S. Resolution No. 1032
directing the Senate Committees on
Justice and Human Rights and on Urban
Planning, Housing and Resettlement to
conduct a thorough investigation, in aid of
legislation, of the irregularities
surrounding the titling of the properties in
the Maysilo Estate.
In a Decision22 dated March 24, 2000, the
Caloocan RTC ordered the quieting of Phil-
Villes titles over Lots 1-G-1, 1-G-2 and 1-
G-3, declaring as valid TCT Nos. 270921,
270922 and 270923 in Phil-Villes name.
The fallo of said Decision reads:
WHEREFORE, and in view of the foregoing,
judgment is hereby rendered as follows:
1. Ordering the quieting of title of
the plaintiff over Lots 1-G-1, 1-G-2
and 1-G-3, all the subd. plan Psd-1-
13-006209, being a portion of Lot
1-G, Psd-2731, LRC Rec. No. 4429,
situated in Kalookan City, as owner
thereof in fee simple and with full
faith and credit;
2. Declaring Transfer Ce[r]tificates
of Title Nos. 270921, 270922 and
270923 in the name of Phil-Ville
Development and Housing
Corporation over the foregoing
parcels of land issued by the
Registry of Deeds for Kalookan City,
as valid and effective;
3. Declaring Transfer Certificate of
Title No. C-314537 over Lot 23,
being a portion of Maysilo Estate
situated in Maysilo, Kalookan City,
in the name of Eleuteria Rivera,
issued by the Registry of Deeds for
Kalookan City, as null and void and
with no force and effect;
4. Ordering the private defendants
to surrender to the Registry of
Deeds for Kalookan City, thru this
Court, the Owners Duplicate
Certificate of said Transfer
Certificate of Title No. C-314537 in
the name of Eleuteria Rivera;
5. Directing the public defendant,
Register of Deeds of Kalookan City
to cancel both Transfer Certificate
of Title Nos. C-314537 in the name
of Eleuteria Rivera on file with the
Register of Deeds for Kalookan
City, and the Owners Duplicate
copy of Transfer Certificate of Title
No. C-314537 being required to be
surrendered by the private
defendants; and
6. Ordering the private defendants
to pay plaintiff, jointly and
severally, the sum of 10,000.00,
as and by way of attorneys fees,
plus the costs of suit.
SO ORDERED.23
In upholding Phil-Villes titles, the trial
court adopted the conclusion in Senate
Committee Report No. 103124 dated May
25, 1998 that there is only one OCT No.
994, registered on May 3, 1917, and that
OCT No. 994, purportedly registered on
April 19, 1917 (from which Eleuteria
Riveras title originated) does not exist.
The trial court also found that it was
physically impossible for respondents to
be the heirs of Eleuteria Riveras
grandmother, Maria de la Concepcion
Vidal, one of the registered owners of OCT
No. 994, because Maria de la Concepcion
was born sometime in 1903, later than
Eleuteria Rivera who was born in
1901.25 Lastly, the RTC pointed out that
contrary to the contentions of Riveras
heirs, there is no overlapping of titles
inasmuch as Lot 23 lies far from Lot 23-A,
where Phil-Villes lands are located.
On April 13, 2000, Atty. K.V. Faylona, on
behalf of respondents, addressed a
letter26 to the Branch Clerk of Court of the
Caloocan City RTC requesting the
complete address of Phil-Ville and its
counsel. Supposedly, respondents
counsels of record, Attys. Nicomedes
Tolentino and Jerry D. Baares, had
abandoned the defense but still kept the
records of the case. Thus, the Notice of
Appeal27 on behalf of respondents was
filed by Atty. Faylona while two of the
heirs, Danilo Bonifacio and Carmen
Bernardino, filed a separate Notice of
Appeal28 through their own counsel. The
appeals were consolidated and docketed
as CA-G.R. CV No. 66547.
On April 17, 2000, respondents withdrew
their appeal and instead filed before this
Court a Petition for Review on
Certiorari,29 which was docketed as G.R.
No. 142640. In a Resolution 30 dated
September 25, 2000, the Court referred
the petition to the Court of Appeals for
adjudication on the merits since the case
does not involve pure questions of law.
Respondents moved for reconsideration of
the Resolution, but the Court denied their
motion. Thus, respondents petition was
transferred to the Court of Appeals and
docketed as CA-G.R. SP No. 62211.
Meanwhile, on October 17, 2002, the
Court of Appeals rendered a Decision 31 in
CA-G.R. CV No. 66547, dismissing the
appeal as regards Danilo Bonifacio and
Carmen Bernardino. Yet, along with Danilo
and Carmen, respondents moved for
reconsideration on the contention that
they are not bound by the judgment since
they had withdrawn their appeal therein.
The Court of Appeals denied said motion
in a Resolution dated June 7, 2004. Danilo,
Carmen and respondents elevated the
case to the Supreme Court through a
Petition for Review on Certiorari, which
was docketed as G.R. No. 163397. Said
petition, however, was denied by this DECLARE RESPONDENTS MAXIMO
Court in a Resolution dated September 8, [BONIFACIO], ET AL. ALREADY IN
2004 for being filed out of time. ESTOPPEL TO RAISE THE SAID
Subsequently, on January 31, 2005, the ISSUE OF JURISDICTION.35
Court of Appeals promulgated its assailed
Decision in CA-G.R. SP No. 62211, setting Condensed, petitioner puts in issue the
aside the RTC judgment and dismissing following: (1) whether the Court of Appeals
Phil-Villes complaint. The appellate court committed grave abuse of discretion in
held that the RTC had no jurisdiction to taking cognizance of respondents
hear Phil-Villes complaint as it effectively petition; and (2) whether the Court of
seeks to annul the Order dated May 25, Appeals committed grave abuse of
1962 of the CFI in LRC No. 4557, which discretion in declaring that the trial court
directed the substitution of the late had no jurisdiction over Civil Case No. C-
Eleuteria Rivera and her co-heirs in place 507.
of Maria de la Concepcion Vidal as
registered owners on OCT No. 994. The Pertinently, however, the genuine issue in
appellate court likewise affirmed the this case is whether TCT No. C-314537 in
validity of OCT No. 994 registered on April the name of Eleuteria Rivera constitutes a
19, 1917 citing the Supreme Court cloud over petitioners titles over portions
Decisions in Metropolitan Waterworks and of Lot 23-A of the Maysilo Estate.
Sewerage Systems v. Court of
Appeals32 and Heirs of Luis J. Gonzaga v. Petitioner argues mainly that the Court of
Court of Appeals33 as precedents. Appeals acted without jurisdiction in
Phil-Ville sought reconsideration34 of the resolving respondents petition for review
decision, but the Court of Appeals denied since it had dismissed their appeal in CA-
its motion in the assailed Resolution dated G.R. CV No. 66547 for failure to file brief.
March 15, 2005. Hence, this petition. Petitioner also points out that
Petitioner alleges that: respondents petition is defective because
I. Maximo Bonifacio alone signed its
THE HONORABLE COURT OF verification and certification of non-forum
APPEALS (FORMER NINTH shopping without proof that he was
DIVISION) ACTED WITHOUT authorized to sign for the other
JURISDICTION ON THE PETITION respondents. It contends that the ruling
FOR REVIEW OF RESPONDENTS in MWSS v. Court of Appeals and Heirs of
MAXIMO BONIFACIO, ET AL. IN CA- Gonzaga v. Court of Appeals will not
G.R SP NO. 62211 BECAUSE OF THE invalidate its titles because it is not a
EARLIER DISMISSAL OF THEIR party to any of said cases. As well,
APPEAL IN CA-G.R NO. 66547. petitioner invokes the finding in the joint
II. investigation by the Senate and the
THE HONORABLE COURT OF Department of Justice (DOJ) that there is
APPEALS (FORMER NINTH only one OCT No. 994, that is, the one
DIVISION) ACTED WITHOUT registered on May 3, 1917. It maintains
JURISDICTION ON THE PETITION that the trial court had jurisdiction to hear
FOR REVIEW FILED BY its action since it is one for quieting of title
RESPONDENTS MAXIMO and not for annulment of the CFI Order
BONIFACIO, ET AL. IN CA-G.R. NO. dated May 25, 1962.
SP 62211 WHICH DOES NOT RAISE
PURE QUESTION[S] OF LAW OR Conversely, respondents rely on MWSS v.
ISSUE[S] OF JURISDICTION AND Court of Appeals and Heirs of Gonzaga v.
THEREFORE THE PROPER REMEDY Court of Appeals that upheld the titles
AVAILABLE TO THEM IS ORDINARY emanating from OCT No. 994 registered on
APPEAL WHICH, AS STATED, HAD April 19, 1917. Therefore, they insist that
ALREADY BEEN DISMISSED IN CA- petitioner has no cause of action to seek
G.R. CV NO. 66547. the nullification of their title which is a
III. derivative of said OCT. Respondents
THE HONORABLE COURT OF reiterate that since they had withdrawn
APPEALS (FORMER NINTH their appeal in CA-G.R. CV No. 66547, the
DIVISION) COMMITTED GRAVE Court of Appeals decision therein applies
ABUSE OF DISCRETION only to Danilo Bonifacio and Carmen
AMOUNTING TO LACK OR IN Bernardino. Lastly, they believe that
EXCESS OF JURISDICTION IN petitioners action is one for annulment of
HOLDING THAT THE TRIAL COURT judgment, which is foreign to the
HAS NO JURISDICTION ON THE jurisdiction of the trial court.
COMPLAINT FOR QUIETING OF
TITLE FILED BY PETITIONER PHIL- Petitioner argues in its first two
VILLE IN CIVIL CASE NO. C-507, OR assignments of errors that the Court of
IN THE ALTERNATIVE, IN FAILING TO Appeals acted with grave abuse of
discretion in entertaining respondents
petition. However, said contention
deserves scant consideration since the
Court of Appeals, in CA-G.R. SP No. 62211,
properly assumed jurisdiction over
respondents case after the same was
referred to it by this Court through our
Resolution dated September 25, 2000. The
issue raised by respondents, as petitioners
in G.R. No. 142640, was purely a question
of fact that is beyond the power of this
Court to resolve. Essentially, respondents
asked the Court to determine the
ownership of the lots purportedly covered
by petitioners titles.
Neither do we find merit in petitioners
contention that the dismissal of the appeal
in CA-G.R. CV No. 66547 is binding on
respondents. The appellate court itself
recognized the withdrawal of appeal filed
by respondents, thus:
However, defendants Maximo R.
Bonifacio, et al. withdrew their appeal so
that the only appellants herein are
defendants-appellants Danilo R. Bonifacio,
et al.36
So did the trial court err in taking
cognizance of petitioners action for
quieting of title contrary to respondents
assertion that it is actually one for
annulment of the CFI Order dated May 25,
1962? To this query, we rule in the
negative.
The nature of an action is determined by
the material allegations of the complaint
and the character of the relief sought by
plaintiff, and the law in effect when the
action was filed irrespective of whether he
is entitled to all or only some of such
relief.37
In its complaint, petitioner alleges:
27. That said TCT No. C-314537 of the late
Eleuteria Rivera, although apparently valid
and effective, are in truth and in fact
invalid and ineffective [;]
27.1. An examination of Decree No.
36455 issued on April 19, 1917 in
LRC Case No. 4429 and also of OCT
No. 994 which was issued
pursuant thereto will show that Lot
23 covered by the said TCT No. C-
3145[3]7 of the late Eleuteria
Rivera is not one of the 34 parcels
of land covered by said Decree No.
36455 and OCT 994;
27.2. That, as hereinbefore stated,
the same TCT No. C-314537 of the
late Eleuteria Rivera is a direct
transfer from OCT No. 994 which
was registered on April 19, 1917.
The fact, however, is that there is
only one OCT No. 994 which was
issued pursuant to Decree No.
36455 in LRC Case No. 4429 and
said OCT 994 was registered with
the Register of Deeds of Rizal on
May 3, 1917. The Office of the
Register of Deeds of Caloocan City
or of Malabon or of Pasig City has
no record of any OCT No. 994 that
was allegedly registered on April
19, 1917;
27.3. That said TCT No. C-314537
of the late Eleuteria Rivera could
not cover Lot 23-A or any portion/s
thereof because, as hereinbefore
recited, the whole of Lot 23-A had
been totally disposed of as early as
July 24, 1923 and she and/or any of
her alleged predecessors-in-
interest is not among those named
in the memorandum of
encumbrances of OCT No. 994 as
vendees or vendors of said Lot 23-
A;38
Ultimately, petitioner submits that a cloud
exists over its titles because TCT No. C-
314537 in the name of Eleuteria Rivera
purports to cover the same parcels of land
covered by petitioners TCT Nos. 270921,
270922 and 270923. It points out that
what appears to be a valid and effective
TCT No. C-314537 is, in truth, invalid
because it covers Lot 23 which is not
among those described in the OCT No. 994
on file with the Register of Deeds of Rizal
and registered on May 3, 1917. Petitioner
notes that the OCT No. 994 allegedly
registered on April 19, 1917 and from
which TCT No. C-314537 was derived, is
not found in the records of the Register of
Deeds. In other words, the action seeks
the removal of a cloud from Phil-Villes title
and/or the confirmation of its ownership
over the disputed properties as the
successor-in-interest of N. Dela Merced
and Sons, Inc.
Quieting of title is a common law remedy
for the removal of any cloud upon, doubt,
or uncertainty affecting title to real
property. Whenever there is a cloud on
title to real property or any interest in real
property by reason of any instrument,
record, claim, encumbrance, or proceeding
that is apparently valid or effective, but is,
in truth and in fact, invalid, ineffective,
voidable, or unenforceable, and may be
prejudicial to said title, an action may be
brought to remove such cloud or to quiet
the title. In such action, the competent
court is tasked to determine the respective
rights of the complainant and the other
claimants, not only to place things in their
proper places, and make the claimant,
who has no rights to said immovable,
respect and not disturb the one so
entitled, but also for the benefit of both, so
that whoever has the right will see every
cloud of doubt over the property 1958 Jesus,
dissipated, and he can thereafter Pacifico
fearlessly introduce any desired Nepomuceno
improvements, as well as use, and even , Sofia
abuse the property.39 Nepomuceno
, Soledad
In order that an action for quieting of title Nepomuceno
may prosper, two requisites must concur: de Jesus
(1) the plaintiff or complainant has a legal
or equitable title or interest in the real 81679 December Pacifico
property subject of the action; and (2) the 15, 1960 Nepomuceno
deed, claim, encumbrance, or proceeding , Sofia N.
claimed to be casting cloud on his title Jugo, Soledad
must be shown to be in fact invalid or N. de Jesus
inoperative despite
its prima facie appearance of validity or (8168 December Pacifico
legal efficacy.40 0) 15, 1960 Nepomuceno
17745 & Co.
As regards the first requisite, we find that C- April 21, Pacifico
petitioner was able to establish its title 13794 1978 Nepomuceno
over the real properties subject of this & Co. Inc.
action. Petitioner submitted in evidence
the Deed of Absolute Sale41 by which it C- May 16, N. de La
acquired the subject property from N. Dela 14603 1978 Merced &
Merced and Sons, Inc., as well as copies of Sons, Inc.
OCT No. 994 dated May 3, 1917 and all
T- April 22, Phil-Ville
the derivative titles leading to the
14822 1987 Development
issuance of TCT Nos. 270921, 270922 and
0 and Housing
270923 in petitioners name as follows:
Corp.42
1avvphi1
Title Registrat Holder
Petitioner likewise presented the Proyecto
No. ion Date
de particion de la Hacienda de Maysilo43 to
8004 July 24, Vedasto prove that Lot 23-A, of which petitioners
1923 Galino Lots 1-G-1, 1-G-2 and 1-G-3 form part, is
among the 34 lots covered by OCT No. 994
8059 Septembe -ditto- registered on May 3, 1917. It produced tax
r 3, 1923 receipts accompanied by a
8160 October -ditto- Certification44 dated September 15, 1997
24, 1923 issued by the City Treasurer of Caloocan
stating that Phil-Ville has been religiously
8164 November Juan Cruz paying realty taxes on the lots. Its
6, 1923 Sanchez documentary evidence also includes a
Plan45 prepared by the Chief of the
8321 February -ditto- Geodetic Surveys Division showing that
26, 1924 Lot 23-A of the Maysilo Estate is remotely
8734 Septembe Emilio situated from Lot 23 portion of the Maysilo
r 11, 1924 Sanchez Estate. Petitioner ties these pieces of
evidence to the finding in the DOJ
12946 November -ditto- Committee Report46 dated August 28,
21, 1927 1997 and Senate Committee Report No.
1031 dated May 25, 1998 that, indeed,
28315 July 16, Eastern there is only one OCT No. 994, that is, the
1935 Syndicate one registered on May 3, 1917.
Mining Co.,
Inc. On the other hand, respondents have not
39163 November Royal adduced competent evidence to establish
18, 1939 Lawrence their title to the contested property or to
Rutter dispute petitioners claim over the same. It
must be noted that the RTC Order dated
43559 July 26, Mapua September 9, 1996 in Civil Case No. C-
1941 Institute of 424, which resulted in the issuance of TCT
Technology No. C-314537 in the name of Eleuteria
Rivera had long been set aside by the
18767 June 16, Sofia
Court of Appeals in CA-G.R. SP No. 43034.
1950 Nepomuceno
Clearly, respondents claim anchored
57541 March 13, Leona N. de primarily on TCT No. C-314537 lacks legal
basis. Rather, they rely simply on the
Courts pronouncement in MWSS v. Court
of Appeals and Heirs of Gonzaga v. Court
of Appeals that OCT No. 994 registered on
May 3, 1917 and all titles emanating from
it are void.
The Supreme Court sustained said
decisions in the case of Manotok Realty,
Inc. v. CLT Realty Development
Corporation47 promulgated on November
29, 2005. In said case, the Court declared
void the titles of the Manotoks and
Aranetas which were derived from OCT No.
994 registered on May 3, 1917 consistent
with its ruling in MWSSand Gonzaga. The
Court disregarded the DOJ and Senate
reports on the alleged anomalies
surrounding the titling of the Maysilo
Estate.
However, on motion for reconsideration,
the Court issued a Resolution48 dated
December 14, 2007 which created a
Special Division of the Court of Appeals to
hear the consolidated cases on remand.
The Special Division was tasked to hear
and receive evidence, conclude the
proceedings and submit to the Court a
report on its findings as well as
recommend conclusions within three
months from the finality of said Resolution.
However, to guide the proceedings before
the Special Division, the Court laid the
following definitive conclusions:
First, there is only one OCT 994. As it
appears on the record, that mother title
was received for transcription by the
Register of Deeds on 3 May 1917, and that
should be the date which should be
reckoned as the date of registration of the
title. It may also be acknowledged, as
appears on the title, that OCT No. 994
resulted from the issuance of the decree of
registration on [19] April 1917, although
such date cannot be considered as the
date of the title or the date when the title
took effect.
Second. Any title that traces its source
to OCT No. 994 dated [19] April 1917
is void, for such mother title is
inexistent. The fact that the Dimson and
CLT titles made specific reference to an
OCT No. 994 dated [19] April 1917 casts
doubt on the validity of such titles since
they refer to an inexistent OCT. This error
alone is, in fact, sufficient to invalidate the
Dimson and CLT claims over the subject
property if singular reliance is placed by
them on the dates appearing on their
respective titles.
Third. The decisions of this Court in MWSS
v. Court of Appeals and Gonzaga v. Court
of Appeals cannot apply to the cases at
bar, especially in regard to their
recognition of an OCT No. 994 dated 19
April 1917, a title which we now
acknowledge as inexistent. Neither could
the conclusions in MWSS [and] Gonzaga
with respect to an OCT No. 994 dated 19
April 1917 bind any other case operating
under the factual setting the same as or
similar to that at bar. 49 (Emphasis
supplied.)
Eventually, on March 31, 2009, the
Supreme Court issued a
Resolution50 reversing its Decision of
November 29, 2005 and declaring certain
titles in the names of Araneta and
Manotok valid. In the course of discussing
the flaws of Jose Dimsons title based on
his alleged 25% share in the hereditary
rights of Bartolome Rivera, Eleuteria
Riveras co-petitioner in LRC No. 4557, the
Court noted:
However, the records of these cases
would somehow negate the rights of
Rivera to claim from Vidal. The Verification
Report of the Land Registration
Commission dated 3 August 1981 showed
that Rivera was 65 years old on 17 May
1963 (as gathered from the records of Civil
Case Nos. 4429 and 4496). It can thus be
deduced that, if Rivera was already 65
years old in 1963, then he must have been
born around 1898. On the other hand,
Vidal was only nine (9) years in 1912;
hence, she could have been born only on
[1903]. This alone creates an unexplained
anomalous, if not ridiculous, situation
wherein Vidal, Riveras alleged
grandmother, was seven (7) years
younger than her alleged grandson.
Serious doubts existed as to whether
Rivera was in fact an heir of Vidal, for him
to claim a share in the disputed portions of
the Maysilo Estate.51
The same is true in this case. The Death
Certificate52 of Eleuteria Rivera reveals
that she was 96 years old when she died
on February 22, 1997. That means that
she must have been born in 1901. That
makes Rivera two years older than her
alleged grandmother Maria de la
Concepcion Vidal who was born in 1903.
Hence, it was physically impossible for
Eleuteria Rivera to be an heir of Maria de
la Concepcion Vidal.
Moreover, the Partition Plan of the Maysilo
Estate shows that Lot 23-A was awarded,
not to Maria de la Concepcion Vidal, but to
Isabel Tuason, Esperanza Tuason, Trinidad
Jurado, Juan O Farrell and Angel O
Farrell.53 What Vidal received as her share
were Lot 6 and portions of Lots 10 and 17,
all subject to the usufructuary right of her
mother Mercedes Delgado. This was not at
all disputed by respondents.
On the other hand, Vedasto Galino, who
was the holder of TCT No. 8004 registered
on July 24, 1923 and to whom petitioner
traces its titles, was among the successful
petitioners in Civil Case No. 391
entitled Rosario Negrao, et al. v.
Concepcion Vidal, et al., who sought the
issuance of bills of sale in favor of the
actual occupants of certain portions of the
Maysilo Estate.
Be that as it may, the second requisite in
an action for quieting of title requires that
the deed, claim, encumbrance, or
proceeding claimed to be casting cloud on
his title must be shown to be in fact invalid
or inoperative despite
its prima facie appearance of validity or
legal efficacy. Article 476 of the Civil
Code provides:
Art. 476. Whenever there is a cloud on
title to real property or any interest
therein, by reason of any instrument,
record, claim, encumbrance or proceeding
which is apparently valid or effective but is
in truth and in fact invalid, ineffective,
voidable, or unenforceable, and may be
prejudicial to said title, an action may be
brought to remove such cloud or to quiet
the title.
An action may also be brought to prevent
a cloud from being cast upon title to real
property or any interest therein.
Thus, the cloud on title consists of: (1) any
instrument, record, claim, encumbrance or
proceeding; (2) which is apparently valid
or effective; (3) but is in truth and in fact
invalid, ineffective, voidable, or
unenforceable; and (4) may be prejudicial
to the title sought to be quieted. The
fourth element is not present in the case
at bar.
While it is true that TCT No. C-314537 in
the name of Eleuteria Rivera is an
instrument that appeared to be valid but
was subsequently shown to be invalid, it
does not cover the same parcels of land
that are described in petitioners titles.
Foremost, Riveras title embraces a land
measuring 14,391.54 square meters while
petitioners lands has an aggregate area
of only 8,694 square meters. On the one
hand, it may be argued that petitioners
land could be subsumed within Riveras
14,391.54-square meter property. Yet, a
comparison of the technical descriptions of
the parties titles negates an overlapping
of their boundaries.
The technical description of respondents
TCT No. C-314537 reads:
A parcel of land (Lot 23, being a portion of
Maysilo Estate) situated in Maysilo,
Caloocan, Metro Manila, Island of Luzon.
Bounded on the NW., along line 1-2 by Blk.
2; on the SW., along line 2-3 by Jacinto
Street, along lines 3-4-5 by Blk. 4; along
line 5-6 by Bustan St., and San Diego
St., on the S., along lines 6-7-8 by Blk. 13,
all of Caloocan Cadastre; on the NE., along
line 8-9 by Caloocan Cadastre; and on the
N., along line 9-1 by Epifanio de los
Santos Avenue. Beginning at a point
marked "1" on plan, being S. 28 deg.
30E., 530.50 m. from MBM No. 1,
Caloocan Cadastre; thence S. 07 deg.
20W., 34.00 m. to point 2; S. 17 deg.
10E., 12.00 m. to point 3; (0/illegible)
S. 15 deg. 31E., 31.00 m. to point
4; S. 27 deg. 23E., 22.50 m. to
point 5;
S. 38 deg. 41E., 43.20 m. to point
6; S. 71 deg. 35E., 10.60 m. to
point 7;
N. 84 deg. 30E., 38.80 m. to point
8; N. 11 deg. 40W., 131.20 m. to
point 9;
N. 89 deg. 10W., 55.00 m. to the
point of beginning; containing an
area of FOURTEEN THOUSAND
THREE HUNDRED NINETY ONE
SQUARE METERS AND FIFTY
FOUR SQUARE DECIMETERS
(14,391.54). more or less. All
points referred to are indicated on
the plan and are marked on the
ground by Old Ps. cyl. conc. mons.
15 x 60 cm.; bearings
true;54 (Emphasis supplied).
On the other hand, the technical
description of petitioners lands before
they were subdivided under TCT No. T-
148220 is as follows:
A parcel of land (Lot No. 1-G of the
subdivision plan Psd-2731, being a portion
of Lot 23-A, Maysilo Estate, GLRO Rec.
No. 4429), situated in the Municipality of
Caloocan, Province of Rizal. Bounded on
the North., by Calle A. Samson; on the
East., by properties of Gregoria de
Jesus, Arcadio de Jesus and Felix de
Jesus; on the South., by properties of
Lucas Bustamante and Patricio
Galauran; and on the West., by property
of Patricio Galauran; and Lot No. 1-E of
the subdivision plan. Beginning at a point
marked "1" on plan, being N.69 deg. 27E.,
1600.19 m. from BLLM No. 1, Mp. of
Caloocan, more or less, thence S. 21 deg.
25E., 44.78 m. to point 2; thence S. 14
deg. 57E., 37.24 m. to point 3; thence S.
81 deg. 11W., 20.28 m. to point 4; thence
S. 86 deg. 06W., 15.45 m. to point 5;
thence N. 67 deg. 20W., 15.91 m. to point
6; thence N. 35 deg. 19W., 37.56 m. to
point 7; thence N. 27 deg. 11W., 12.17 m.
to point 8; thence N. 19 deg. 26W., 23.32
m. to point 9; thence N. 13 deg. 08W.,
28.25 m. to point 10; thence S. 78 deg.
45W., 13.00 m. to point 11; thence N. 0
deg. 56E., 48.92 m. to point 12; thence N.
89 deg. 13E., 53.13 m. to point 13; thence
S. 21 deg. 24E., 67.00 m. to the point of
beginning; containing an area of EIGHT
THOUSAND SIX HUNDRED NINETY
FOUR (8,694) SQUARE METERS, more
or less. All points referred to are indicated
on the plan and are marked on the ground
points 1,2,3 and 13 by Old PLS conc.
mons. point 4,6,7,8 and 9 by Old PLS
stone mons.; points 5 to 10 and old stakes
points 11 and 12 by PLS conc. mons.
bearings true, declination 1 deg. 08E.,
date of the original survey, Sept. 8-27,
Oct. 4-21 and Nov. 17-18, 1911 and that of
the subdivision survey, Oct. 14 and 15,
1927.55 (Emphasis supplied).
Such disparity in location is more vividly
illustrated in the Plan prepared by Engr.
Privadi J.G. Dalire, Chief of the Geodetic
Surveys Division, showing the relative
positions of Lots 23 and 23-A. As it
appears on the Plan, the land covered by
respondents TCT No. C-314537 lies far
west of petitioners lands under TCT Nos.
270921, 270922 and 270923. Strictly
speaking, therefore, the existence of TCT
No. C-314537 is not prejudicial to
petitioners titles insofar as it pertains to a
different land.
Significantly, an action to quiet title is
characterized as a proceeding quasi in
rem.56 In an action quasi in rem, an
individual is named a defendant and the
purpose of the proceeding is to subject his
interests to the obligation or loan
burdening the property. Actions quasi in
rem deal with the status, ownership or
liability of a particular property but which
are intended to operate on these
questions only as between the particular
parties to the proceedings and not to
ascertain or cut off the rights or interests
of all possible claimants. The judgment
therein is binding only upon the parties
who joined in the action.57
Yet, petitioner was well aware that the lots
encompassed by its titles are not the
same as that covered by respondents
title. In its complaint, Phil-Ville alleges:
27.4. That Lot 23, being a portion of
Maysilo Estate, as described in said TCT
No. C-314537 of the late Eleuteria Rivera
when plotted using its tie line to MBM No.
1, Caloocan Cadastre is outside Lot 23-A of
the Maysilo Estate. This must be so
because Lot 23 is not [a] portion of Lot 23-
A, Maysilo Estate.58
This brings petitioners action within the
purview of Rule 63 of the Rules of Court on
Declaratory Relief. Section 1 of Rule 63
provides:
SECTION 1. Who may file petition.-Any
person interested under a deed, will,
contract or other written instrument,
whose rights are affected by a statute,
executive order or regulation, ordinance or
any other governmental regulation
may, before breach or
violation thereof, bring an action in the
appropriate Regional Trial Court to
determine any question of construction
or validity arising, and for a
declaration of his rights or duties,
thereunder.
An action for the reformation of an
instrument, to quiet title to real
property or remove clouds therefrom,
or to consolidate ownership under Article
1607 of the Civil Code, may be brought
under this Rule. (Emphasis supplied).
An action for declaratory relief
presupposes that there has been no actual
breach of the instruments involved or of
the rights arising thereunder. Since the
purpose of an action for declaratory relief
is to secure an authoritative statement of
the rights and obligations of the parties
under a statute, deed, or contract for their
guidance in the enforcement thereof, or
compliance therewith, and not to settle
issues arising from an alleged breach
thereof, it may be entertained before the
breach or violation of the statute, deed or
contract to which it refers. A petition for
declaratory relief gives a practical remedy
for ending controversies that have not
reached the state where another relief is
immediately available; and supplies the
need for a form of action that will set
controversies at rest before they lead to a
repudiation of obligations, an invasion of
rights, and a commission of wrongs.
In the present case, petitioner filed a
complaint for quieting of title after it was
served a notice to vacate but before it
could be dispossessed of the subject
properties. Notably, the Court of Appeals,
in CA-G.R. SP No. 43034, had earlier set
aside the Order which granted partial
partition in favor of Eleuteria Rivera and
the Writ of Possession issued pursuant
thereto. And although petitioners
complaint is captioned as Quieting of Title
and Damages, all that petitioner prayed
for, is for the court to uphold the validity
of its titles as against that of respondents.
This is consistent with the nature of the
relief in an action for declaratory relief
where the judgment in the case can be
carried into effect without requiring the
parties to pay damages or to perform any
act.59
Thus, while petitioner was not able to
demonstrate that respondents TCT No. C-
314537 in the name of Eleuteria Rivera
constitutes a cloud over its title, it has
nevertheless successfully established its
ownership over the subject properties and
the validity of its titles which entitles it to
declaratory relief.

WHEREFORE, the petition for review on

certiorari is GRANTED. The Decision
dated January 31, 2005 and Resolution
dated March 15, 2005 of the Court of
Appeals in CA-G.R. SP No. 62211 are SET
ASIDE. The Decision dated March 24,
2000 of the Caloocan RTC in Civil Case No.
C-507 is hereby REINSTATED and
UPHELD.

No pronouncement as to costs.

SO ORDERED.