G.R. No. 135817 November 30, 2006 REYNALDO RODRIGUEZ and NANCY A. RODRIGUEZ, Petitioners, vs.

CONCORDIA ONG LIM, EURESTES LIM AND ELMER LIM, Respondents. Before the Court is a petition for review on certiorari filed by the spouses Reynaldo and Nancy Rodriguez seeking the reversal of the Decision1 dated July 18, 1995 of the Court of Appeals in CA-G.R. CV No. 27440. The assailed decision affirmed that of the Regional Trial Court (RTC) of Lucena City, Branch 58, declaring, inter alia, Transfer Certificate Title (TCT) No. T-128607 in the names of petitioners Reynaldo and Nancy Rodriguez null and void and directing them to vacate the lots subject of litigation. Likewise sought to be reversed is the appellate courts Resolution dated October 5, 1998 denying petitioners motion for reconsideration. As culled from the respective decisions of the RTC of Lucena City, Branch 58 (court a quo) and the appellate court, the factual and procedural antecedents are as follows: Pablo Goyma Lim, Jr. filed with the court a quo a complaint for cancellation of certificate of title and injunction against the spouses Rodriguez. In his complaint, Pablo Goyma Lim, Jr. alleged that his mother, Dominga Goyma,2 was the owner of two parcels of land (subject lots). The first parcel,3 containing an area of 28,051 square meters, more or less, is situated in the Sitio of Tulay-Buhangin, Barrio Ilayang Palo, Municipality of Pagbilao, Province of Quezon. The second parcel,4 containing an area of 260,590 sq m, more or less, is situated in the Sitio of Tulay-Buhangin, Barrio of Laguimanoc, Municipality of Atimonan (now Padre Burgos), Province of Quezon. The subject lots were registered in the name of Dominga Goyma on February 6, 1948 under TCT No. T2857. Dominga Goyma died on July 19, 1971 and was survived by her only son, Pablo Goyma Lim, Jr., a spurious son acknowledged and recognized by her. The complaint also alleged that during her lifetime, Dominga Goyma exclusively possessed the subject lots and upon her death, Pablo Goyma Lim, Jr. succeeded to all her rights of ownership and possession. However, the spouses Rodriguez, despite their knowledge that Pablo Goyma Lim, Jr., was now the owner and possessor of the subject lots, allegedly unlawfully and fraudulently made it appear that they had purchased the subject lots from persons who were not the owners thereof. The spouses Rodriguez allegedly caused the cancellation of TCT No. T-2857 despite the fact that the owners duplicate copy thereof was in the possession of Pablo Goyma Lim, Jr. On February 10, 1975, TCT No. T-128605 was issued in the name of Frisco5 Gudani, estranged husband of Dominga Goyma. This title was cancelled by TCT No. T-128606 issued in the name of Eduardo Victa also on February 10, 1975. The latter certificate of title, in turn, was cancelled by TCT No. T-128607 issued in the name of the spouses Rodriguez also on February 10, 1975. Since May 1975, the spouses Rodriguez allegedly tried to enter and occupy the subject lots by force and intimidation. Pablo Goyma Lim, Jr. thus prayed in his complaint that the spouses Rodriguez be permanently enjoined from entering and occupying the subject lots; TCT No. 128607 be declared null and void and TCT No. T-2857 in the name of Dominga Goyma be reinstated; and the spouses Rodriguez be ordered to pay Pablo Goyma Lim, Jr. damages, attorneys fees and the costs of suit. In their Answer, the spouses Rodriguez denied the material allegations in the complaint. They alleged that Dominga Goyma was not the mother of Pablo Goyma Lim, Jr. They averred that the subject lots were the conjugal property of Frisco Gudani and his wife Dominga Goyma. When the latter died, Frisco Gudani was her sole surviving heir. According to the spouses Rodriguez, Frisco Gudani and Dominga Goyma, as husband and wife, jointly exercised acts of ownership and possession over the subject lots. When Dominga Goyma passed away, Frisco Gudani executed an instrument of extra-judicial settlement of the estate of the deceased. By virtue of the said document, Dominga Goymas share in the subject lots was adjudicat ed in favor of Frisco Gudani as her sole surviving heir. The extra-judicial settlement allegedly complied with the requirements of publication under the Rules of Court. Thereafter, Frisco Gudani allegedly sold the subject lots to Eduardo Victa who, in turn, sold the same to the spouses Rodriguez. The latter claimed that they were purchasers in good faith and for value. Further, they denied that they had tried to enter the subject lots by means of force and intimidation. On the contrary, the spouses Rodriguez claimed that they have been in possession of the subject lots by themselves and their predecessors-in-interest. At the pre-trial, the parties stipulated on the following facts: 1. that plaintiff Pablo Goyma [Lim], Jr., the plaintiff in this case, is the same person mentioned in the birth certificate as Pablo Go Yma, xerox copy of which was submitted during the previous preliminary hearing, marked as Exhibit "A"; 2. that Pablito Goyma Lim mentioned in the Individual Income Tax Returns of the deceased Dominga Goyma, xerox copies of which were submitted during the previous preliminary hearing and marked as Exhibits "B", "C" and "D" and in the Statement of Assets and Liabilities of the deceased Dominga Goyma marked as Exhibit "E", refers to the plaintiff Pablo Goyma Lim, Jr.; 3. that according to plaintiff Pablo Goyma Lim, Jr., he is an illegitimate child other than natural of the deceased Dominga Goyma; 4. that the deceased Dominga Goyma died on July 19, 1971 and that at the time of her death, she was then the registered owner of the two parcels of land mentioned in paragraph 2 of the complaint covered by Transfer Certificate of Title No. T-2857; that under the aforesaid Transfer Certificate of Title, said lands are registered in the name of Dominga Goyma, wife of Frisco Gudani; 5. that at the time of the death of Dominga Goyma, plaintiff Pablo Goyma Lim, Jr., was then more than thirty-five (35) years of age;

6. that previous to the instant case, there has been no judicial inquiry as to the maternity or filiation of plaintiff Pablo Goyma Lim, Jr. x x x x6 Efforts of the parties to enter into an amicable settlement of the case fell through. Consequently, trial on the merits ensued. In the meantime, in the course of the trial, Pablo Goyma Lim, Jr. died on September 8, 1988. He was duly substituted by his surviving spouse, Concordia Ong Lim, and children Eurestes and Elmer Lim. During trial, both parties adduced their respective evidence. Among those presented to support the allegations of Pablo Goyma Lim, Jr. were the following: Deed of Absolute Sale dated December 13, 1945 (Exhibit "I") covering four parcels of land, including the subject lots, purchased by Dominga Goyma from Marciano and Marina Rodriguez; Marital Consent dated March 19, 1932 (Exhibit "K") executed by Frisco Gudani and Dominga Goyma; TCT No. T-2857 (Exhibit "A") covering the subject lots issued in the name of Dominga Goyma; Pablo Goyma Lim, Jr.s Certificate of Birth (Exhibit "B") indicating that his mother was Dominga Goyma; Statement of Assets, Income and Liabilities for 1958 (Exhibit "C") of Dominga Goyma indicating Pablo Goyma Lim, Jr. as her son; Income Tax Returns for calendar years 1953 up to 1955 (Exhibit "D" to "F") of Dominga Goyma, where she invariably claimed personal exemption as head of the family and stated therein that she was "separated" from her husband and claimed an exemption for her son Pablo Goyma Lim, Jr.; and Real Property Tax Receipts from 1955, 1957 up to 1975 (Exhibits "H," "H-1" up to "H-22") covering the subject property paid by Pablito Goyma Lim, Jr. For their part, the spouses Rodriguez presented the following documentary evidence: Deed of Absolute Sale dated February 3, 1975 (Exhibit "I") covering the subject lots showing that the spouses Rodriguez acquired them from Eduardo Victa; TCT No. T-128607 (Exhibit "II") covering the subject lots issued in the name of the spouses Rodriguez on February 10, 1975; TCT No. T-128606 (Exhibit "V") covering the subject lots issued in the name of Eduardo Victa on February 10, 1975; TCT No. T-128605 (Exhibit "IV") covering the subject lots issued in the name of Frisco Gudani on February 10, 1975; and TCT No. T-2857 (Exhibit "III") covering the subject lots in the name of Dominga Goyma. Also admitted in evidence by the court a quo was the deposition of Frisco Gudani taken on October 22, 1977. The court a quo summarized the contents of his deposition as follows: x x x From the deposition, it appears that Prisco M. Gudani, a 77 year-old laborer resident of Barrio Binahaan, Pagbilao, Quezon, was married to Dominga Goyma on March 22, 1922. They lived together for eleven (11) months and they were separated when Prisco Gudani left the conjugal dwelling one night without the knowledge of Dominga Goyma, never returning to the conjugal dwelling since then. He knows that Dominga Goyma is now dead. He knows too that Pablo Goyma Lim is the son of the late Dominga Goyma. His statement in his Affidavit, dated June 25, 1976 (Exhibit "C-Deposition") that Pablo Goyma Lim, Jr. is not the son of Dominga Goyma is not correct. He said that it was Atty. Alejandro B. Aguilan who prepared said affidavit and told him to sign it otherwise what property he will receive will be forfeited in favor of the government. He does not know anything about the two parcels of land subject of this case. On the affidavit, dated March 15, 1973 (Exhibit "DDeposition") adjudicating unto himself the property stated therein, including the two parcels of land subject of this case, he explained that said affidavit was prepared by Atty. Alejandro B. Aguilan, who must have known about the properties left by Dominga Goyma and made him understand that he is inheriting the three (3) parcels of land left by Dominga Goyma, the truth being that he had never set foot on these properties and he does not know anything about these properties. When he arrived, the prepared affidavit was read to him and he was told to sign. Atty. Aguilan explained to him that if he will not sign the document, the properties will go to the government and, because he did not want these properties to go to the government, he signed the affidavit in order to get the properties. Had it been explained to him that these properties will not be forfeited in favor of the government, he will not sign the affidavit. The first time Atty. Aguilan told him about the properties of Dominga Goyma was about two years after her death. Atty. Aguilan went to him in his residence in Pagbilao, Quezon and told him that if he will not agree to get the property of Dominga Goyma, those properties will go to the government. Atty. Aguilan told him that because he had not contributed anything in the acquisition of said properties, his share is one-fourth. On March 15, 1973, Atty. Aguilan made him sign a prepared petition for the issuance of a second owners duplicate copy of Transfer Certificate of Title No. T -2857 (Exhibit "E-Deposition"). On the same date, he was also made to sign an "Affidavit of Loss" prepared by Atty. Aguilan (Exhibit "E-1, Deposition"). He had not at any time been in possession of the owners copy of Transfer Certificate of Title No. T-2857. He signed both the foregoing documents on the explanation of Atty. Aguilan that he will use them in order to look for the title. He does not know Eduardo Victa and had never met him personally. When shown the "DEED OF CONDITIONAL SALE OF REAL PROPERTY," dated September 10, 1974 (Exhibit "F-Deposition"), he admitted he sold the property. Said document was prepared by Atty. Aguilan who told him that the P20,000.00 constitute his one-fourth share of the properties of Dominga Goyma, but Atty. Aguilan told him to receive only P10,000.00 because the P10,000.00 will be used to cover the expenses of litigation. Of the P10,000.00 left, P5,000.00 was given to him and the otherP5,000.00 was taken by Atty. Aguilan, as they are share and share alike in the P10,000.00. He explained that when he signed the deed of sale, he was made to understand that he was selling only the one-fourth share of the property that he owns and the price for the one-fourth share is P20,000.00. On the document entitled "DEED OF ABSOLUTE SALE OF REAL PROPERTY," dated January 17, 1975 (Exhibit "G-Deposition") he claims not to have received the P60,000.00. Atty. Aguilan, who prepared the document, told him to sign it and he (Atty. Aguilan) will deliver the money later. Atty. Aguilan did not mention the P60,000.00, but only P20,000.00. It was only Atty. Aguilan who was present when he signed the document. He met defendant Reynaldo Rodriguez once when he went to the office of Atty. Magadia and Atty. Uy at the Baas Building, Rizal Avenue, Manila, in the company of Atty. Aguilan. He was invited to a restaurant and told by Reynaldo Rodriguez that he purchased the properties for a very low price and he would

give Gudani an additional amount of P1,500.00 upon the termination of the case that may be filed by Pablo Goyma Lim, that is why he was holding the P10,000.00 to be spent for the expected litigation. After eating, Reynaldo Rodriguez gave him P50.00 for him to buy betel leaves. He said that Atty. Alejandro B. Aguilan is a lawyer in Pagbilao, Quezon, who persuaded him to agree to recover his share from the properties of Domingo Goyma. x x x7 Based on the evidence presented by both parties, the court a quo rendered judgment in favor of Pablo Goyma Lim, Jr. and against the spouses Rodriguez. In support of its conclusions, the court a quo made the following factual findings: Dominga Goyma married Frisco Gudani on March 22, 1922. However, after living together for only eleven (11) months, Frisco Gudani left the conjugal abode and never returned. They never had any children. On March 19, 1932, Frisco Gudani and Dominga Goyma executed a public instrument denominated as "MARITAL CONSENT,"8the contents of which are quoted below in full:

MARITAL CONSENT KNOW ALL MEN BY THESE PRESENTS: That I, Prisco Gudani, Filipino, of legal age, married and a resident of Pagbilao, Tayabas, declares: That I am the husband of Dominga Go Imco Ima, Filipina, of legal age, and also a resident of Pagbilao, Tayabas, for whom I make this marital consent. That since the year 1924, for certain reasons which are delicate to state or mention herein, my wife and I have been living separately. It was agreed by and between us from the time we separated that each could then live the life of a single person as if we did not take each other as husband and wife, and that each could then make his or her own living without the intervention and responsibility of the other. Under this state of life that we have, living separately, and upon request that I grant her a marital consent, by these presents I do hereby give and grant unto my wife, Dominga Go Imco Ima, full power and authority and consent to do and perform any and every act and thing whatsoever requisite, necessary or proper to be done in whatever she may undertake to do in which under the law in force and in these Island my presence and personal intervention is necessary, as fully to all intents and purposes as I might or could do if present and intervening in person, and specially the following acts: To buy or sell, hire, lease or mortgage, lands or buildings, and other forms of real property, upon such terms and conditions, and under such covenants as my wife may deem proper; To purchase and sell, hire or pledge, goods, wares, merchandise, chattels, choses in action, and other forms of personal property that are or may come into her possession as owner or otherwise; To borrow or lend moneys, with or without security, upon such terms and conditions as she may approve; and to transact any and all business, operations and affairs with any institution as may be deemed proper and convenient by her; To make, sign, execute and deliver contracts, documents, agreements, deeds and other writings of whatsoever nature, kind and description, with any and all persons, concerns, and entities, upon terms and conditions acceptable to her; To prosecute and defend any and all suits, actions and other proceedings in the courts, tribunals, departments and offices of the Government of the Philippine Islands, and to terminate compromise, settle and adjust the same. I do hereby renounce any and all rights, title, interest and participation, rights of actions, if any I have, in connection with the properties, real or personal, that my wife might have acquired by purchase, exchange, or otherwise, from any person from the time we were separated, in 1924, and to all that she may acquire in the future. In consideration of all that is provided above in this marital consent, and in consideration of the renunciation made by my husband, I, Dominga Go Imco Ima, hereby agree also to renounce any and all rights, title, interest and participation, and also any right of action, that I may have in connection with any property, real or personal, acquired or which may be acquired by my husband since we were separated in 1924, and that any debts or obligations incurred or which may be incurred by me since we were separated in 1924, and in the future pursuant to this marital consent, are my sole debts and obligations in which my husband can have no responsibility. IN WITNESS WHEREOF, we together have hereunto signed our names below as signs of our conformity with the things mentioned above, at Pagbilao, Tayabas, P.I., on this 19th day of March, 1932. (SGD) PRISCO M. GUDANI PRISCO GUDANI Husband (SGD) DOMINGA GO YMCO YMA DOMINGA GO IMCO IMA Wife SIGNED IN THE PRESENCE OF: (SGD) SEVERINO F. MARTINEZ (SGD) Illegible UNITED STATES OF AMERICA PHILIPPINE ISLANDS Municipality of Pagbilao) Province of Tayabas ) S.S. Before me, a Notary Public in and for the Province of Tayabas, Philippine Islands, personally appeared Prisco Gudani, exhibiting to me his cedula personal No. G-4219255 issued at Pagbilao, Tayabas, and dated December 15, 1931 AND Dominga Go Ymco Ima, without a personal cedula by reason of her sex, personally known to me and known to me to be the same persons who executed the foregoing instrument, and they acknowledge to me that they executed the same freely and voluntarily for the uses and purposes therein stated. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal at Pagbilao, Tayabas, on this 19th day of March 1932. (SGD) MARIANO P. DULDULAO NOTARY PUBLIC My Commission will expire on December 31, 1933 Doc. No. 15 Book No. 11 Page No. 5 Series of 1932.

After Frisco Gudani had left the conjugal abode, Dominga Goyma and Pablo Lim cohabited with each other as common law husband and wife. They had a son, Pablo Goyma Lim, Jr. who was born on March 28, 1935. On December 13, 1945, as evidenced by a Deed of Absolute Sale (Exhibit "I"), Dominga Goyma purchased from the spouses Marciano and Marina Rodriguez four (4) parcels of land, including the subject lots. As a result of the said sale, the certificate of title (TCT No. 11473) covering the said lots were canceled and, in lieu, thereof TCT No. T-2857 was issued in favor of Dominga Goyma, "wife of Frisco Gudani," by the Register of Deeds of the Province of Quezon.

The subject lots were purchased by Dominga Goyma from her personal funds when she and Frisco Gudani were already separated and after they had executed the instrument denominated as Marital Consent dated March 19, 1932. He did not contribute anything in the purchase of the subject lots nor did he know about their existence. The owners duplicate copy of TCT No. T-2857 was in Dominga Goymas custody and during her lifetime, she took possession of the subject lots and instituted therein as tenants Dominador Torres, Loreto Estopace and Simeon Estopace. Before she passed away on July 19, 1971, Dominga Goyma gave TCT No. T-2857 to her son, Pablo Goyma Lim, Jr., who immediately took possession of the subject lots. Two (2) years after Dominga Goymas death, Atty. Alejandro D. Aguilan went to see Frisco Gudani in Pagbil ao, Quezon, and informed the latter about the properties, including the subject lots, left by the deceased. Atty. Aguilan falsely made Frisco Gudani to believe that if he would not acquire the properties for himself, the same would be forfeited in favor of the government. Frisco Gudani was then persuaded by Atty. Aguilan to affix his signature on the following documents: (a) an Affidavit dated March 15, 1973 adjudicating to himself the properties mentioned therein, including the subject lots; (b) a Petition dated March 15, 1973 filed with the Court of First Instance of Quezon for the issuance of a second owners duplicate copy of TCT No. T -2857; (c) an Affidavit of Loss dated March 15, 1973 for the loss of the owners duplicate copy of TCT No. T -2857; and (d) an Affidavit dated June 27, 1976 stating that Pablo Goyma Lim, Jr. was not the son of Dominga Goyma. After the subject lots were adjudicated in favor of Frisco Gudani and the second owners duplicate copy of TCT No. T-2857 was obtained, Atty. Aguilan likewise made the former sign the Deed of Conditional Sale of Property dated September 10, 1974 covering the subject lots in favor of Eduardo Victa. The two parties to the instrument never met each other and it was only Atty. Aguilan who was present when Frisco Gudani signed the same. The notary public before whom they supposedly acknowledged the same was not present. For the said purported sale, Frisco Gudani received P5,000.00 only because, according to Atty. Aguilan, he did not contribute anything to the acquisition of the subject lots. Thereafter, Frisco Gudani was made to sign by Atty. Aguilan a Deed of Absolute Sale dated January 17, 1975 transferring the subject lots to Eduardo Victa. For a time, the subject lots continued to be covered by TCT No. T-2857 in the name of Dominga Goyma. On February 3, 1975, as evidenced by the Deed of Absolute Sale (Exhibit "I"), Eduardo Victa sold the subject lots to the spouses Rodriguez. Aside from the said instrument, the following documents were given to the spouses Rodriguez: (a) the second duplicate owners copy of TCT No. T-2857; (b) Affidavit dated March 15, 1973 of Frisco Gudani adjudicating to himself the properties of Dominga Goyma, including the subject lots; and (c) Deed of Absolute Sale of Real Property dated January 17, 1975 executed by Frisco Gudani in favor of Eduardo Victa. All these documents were presented by a certain Atty. Magadia to the Register of Deeds of the Province of Quezon on February 10, 1975. On the basis of these documents, TCT No. T-2857 was canceled and, in lieu thereof, TCT No. T-128605 was issued in the name of Frisco Gudani on February 10, 1975. Thereafter, TCT No. T128605 was cancelled and, in lieu thereof, TCT No. T-128606 was issued by the same Register of Deeds in the name of Eduardo Victa also on February 10, 1975. Finally, TCT No. T-128606 was canceled and, in lieu thereof, TCT No. T-128607 was issued by the same Register of Deeds in the name of the spouses Rodriguez also on February 10, 1975. Based on its factual findings, the court a quo concluded that the evidence showed that the transactions involving the subject lots, particularly the transfers thereof from the deceased Dominga Goyma to Frisco Gudani and from him to Eduardo Victa were fraudulent and made through the machinations of Atty. Aguilan. The latter, according to the court a quo, "took advantage of his legal training in making Frisco Gudani, a simple- minded laborer, an unsuspecting and nave tool in a grand scheme to dispossess plaintiff Pablo Goyma Lim, Jr. of the property rightfully his by inheritance from his mother, the deceased Dominga Goyma." 9 Given the fraudulent character of the transactions, the court a quo held that the spouses Rodriguez could not avail of the protective mantle of the law protecting purchasers for value in good faith. The spouses Rodriguez were declared to be purchasers in bad faith because they had prior knowledge of the claim of Pablo Goyma Lim, Jr. over the subject lots and even anticipated his filing of the case against them. The court a quo also stated that even granting arguendo that fraud attendant to the transactions were not sufficient to vitiate consent as to nullify the transactions, still the transactions entered into by Frisco Gudani relative to the subject lots were void for want of authority to sell them. The court a quo explained that since Dominga Goyma died on July 19, 1971 without a will, legal or intestate succession takes place following paragraph (1) of Article 96010 of the Civil Code. Under the law on intestacy, particularly Article 99811 thereof, the widower or widow who survives with illegitimate children shall be entitled to one-half of the inheritance and the illegitimate children to the other half. However, in Frisco Gudanis case, he did not contribute any amount in the purchase of the subject lots. Moreover, these were acquired by Dominga Goyma after her de facto separation from Frisco Gudani. The estate left by the deceased, including the subject lots, should have first been partitioned in an appropriate estate proceeding to determine those entitled thereto. Without the said proceeding or prior thereto, Frisco Gudani could not lay valid claim, if he had any, over the subject lots as sole heir and he could not have been the owner thereof who could legally transfer ownership by means of sale. The decretal portion of the Decision dated May 17, 1990 of the court a quo reads: WHEREFORE, premises considered, judgment is hereby rendered in favor of the substituted plaintiffs, CONCORDIA ONG LIM, EURESTES LIM and ELMER LIM and against the defendants, the spouses REYNALDO RODRIGUEZ and NANCY A. RODRIGUEZ, as follows: a) Declaring as null and void all transactions relative to the properties in question submitted to the Register of Deeds for the Province of Quezon on February 10, 1975;

b) Declaring Transfer Certificate of Title No. T-128607 in the name of defendants as null and void and ordering the reinstatement of Transfer Certificate of Title No. T-2857 in the name of "DOMINGA GOYMA, of age, the wife of Frisco Gudani," plaintiffs predecessor-in-interest; c) Ordering the defendants to immediately vacate the premises of the properties subject of this litigation; d) Ordering the defendants to pay to the plaintiffs the amount of P24,000.00 as attorneys fees; and e) Ordering the defendants to pay the costs. SO ORDERED.12 Aggrieved, the spouses Rodriguez filed an appeal with the Court of Appeals which rendered the assailed Decision dated July 18, 1995 affirming in toto the decision of the court a quo. The appellate court substantially affirmed the factual findings and conclusion of the court a quo. It stressed that Pablo Goyma Lim, Jr. was the son of the decedent Dominga Goyma as evidenced by a voluntary acknowledgment made in his record of birth (Exhibit "C") and in the other documentary evidence presented during trial. His right to succession was transmitted when Dominga Goyma passed away on July 19, 1971 following Article 777 13 of the Civil Code. On the other hand, Frisco Gudani could not dispose of the subject lots before partition of the estate of Dominga Goyma and without authority given by Pablo Goyma Lim, Jr. On the matter of whether the spouses Rodriguez purchased the subject lots in good faith and for value, the appellate court ruled in the negative, as record was replete with evidence disproving their claim of good faith. Rejecting the argument proffered by the spouses Rodriguez, the appellate court held that Frisco Gudani and Eduardo Victa were not indispensable parties because they were not in possession of the subject lots and their interests therein were inferior and irrelevant to, and could not affect, the right of Pablo Goyma Lim, Jr. to a designated portion of the subject lots by inheritance from his mother Dominga Goyma. The decretal portion of the appellate courts decision reads: PREMISES CONSIDERED, the decision appealed from is hereby AFFIRMED. SO ORDERED.14 The spouses Rodriguez filed a motion for reconsideration which the appellate court denied in the assailed Resolution dated October 5, 1998. Forthwith, the spouses Rodriguez (petitioners) filed the present petition for review on certiorari and in support thereof allege the following: I THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT RESPONDENTS PREDECESSOR -ININTEREST, PABLO GO IMA LIM, WAS A CO-OWNER OF THE SUBJECT PROPERTIES AND ENTITLED TO ONE-HALF OF THE SUBJECT PARCELS OF LAND DESPITE THE FACT THAT SAID PABLO GO IMA LIM WAS NOT RECOGNIZED BY HER [SIC] PARENTS AS AN ILLEGITIMATE CHILD AND THE ALLEGED DOCUMENTS PROVING HIS VOLUNTARY ACKNOWLEDGMENT DO NOT SUFFICE TO PROVE HIS FILIATION TO HIS PARENTS. II THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE VENDEE OF THE SUBJECT PROPERTIES, PRISCO GUDANI, COULD NOT VALIDLY DISPOSE OF THE SUBJECT PROPERTIES BEFORE PARTITION AND WITHOUT THE LEGAL AUTHORITY GIVEN BY THE ILLEGITIMATE CHILD, PABLO GO IMA LIM. III THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN NOT HOLDING THAT PETITIONERS WERE PURCHASERS OF THE SUBJECT PROPERTIES IN GOOD FAITH AND FOR VALUE. IV THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT THE VENDEES OF THE SUBJECT PROPERTIES, PRISCO GUDANI AND EDUARDO VICTA, NOT BEING INDISPENSABLE PARTIES, THEY WERE PROPERLY NOT IMPLEADED AS DEFENDANTS IN THE COMPLAINT.15 The petition is bereft of merit. Petitioners assail the filiation of Pablo Goyma Lim, Jr. stating that he was not duly acknowledged or recognized by either of his parents. This contention is erroneous. It is axiomatic that factual findings of the trial court, especially when affirmed by the appellate court, are conclusive and binding on the Court.16 In this case, the court a quo and the appellate court are in agreement that, based on the evidence presented, Pablo Goyma Lim, Jr. was the illegitimate and acknowledged son of Dominga Goyma. The Court has laid down the manner of establishing the filiation of children, whether legitimate or illegitimate, as follows: The filiation of illegitimate children, like legitimate children, is established by (1) the record of birth appearing in the civil register or a final judgment; or (2) an admission of legitimate filiation in a public document or a private handwritten instrument and signed by the parent concerned. In the absence thereof, filiation shall be proved by (1) the open and continuous possession of the status of a legitimate child; or (2) any other means allowed by the Rules of Court and special laws. The due recognition of an illegitimate child in a record of birth, a will, a statement before a court of record, or in, any authentic writing is, in itself, a consummated act of acknowledgment of the child, and no further action is required. In fact, any authentic writing is treated not just a ground for compulsory recognition; it is in itself a voluntary recognition that does not require a separate action for judicial approval.17 Various documentary evidence were proffered by Pablo Goyma Lim, Jr. to prove that he was the illegitimate and acknowledged son of Dominga Goyma. Among them were his certificate of birth (Exhibit "B") indicating that his mother was Dominga Goyma; statement of assets, income and liabilities for 1958 (Exhibit "C") of Dominga Goyma indicating him as her son and; income tax returns for calendar years 1953 up to 1955 (Exhibits "D" to "F")) of Dominga Goyma where she invariably claimed personal exemption as head of the family and

stated therein that she was "separated" from her husband and claimed an exemption for her son, Pablo Goyma Lim, Jr. These pieces of documentary evidence, whose authenticity were not refuted by petitioners, were properly considered by the court a quo and the appellate court to establish that Pablo Goyma Lim, Jr. was acknowledged by Dominga Goyma to be her illegitimate son. The court a quo, as affirmed by the appellate court, likewise correctly nullified TCT No. T-128607 in the name of petitioners. In fact, all the transactions relative to TCT No. T-2857, i.e., affidavit of Frisco Gudani adjudicating to himself the subject lots and their purported sale by him to Eduardo Victa and by the latter to petitioners, were declared null and void by the court a quo on the ground that, as established by evidence, these were all made through the fraudulent machinations of Atty. Aguilan. It should be recalled that Atty. Aguilan made Frisco Gudani affix his signature on, among other documents, a Petition dated March 15, 1973 filed with the Court of First Instance of the Province of Quezon for the issuance of a second owners duplicate copy of TCT No. T-2857 and an Affidavit of Loss dated March 15, 1973 for the loss of the owners duplicate copy of TCT No. T-2857. Obviously, these documents contained falsehoods because TCT No. T-2857 was never lost and, in fact, had been in the possession of Dominga Goyma during her lifetime and, when she passed away on July 19, 1971, in the possession of Pablo Goyma Lim, Jr. It has been consistently ruled that "when the owners duplicate certificate of title has not been lost, but is in fact in the possession of another person, then the reconstituted certificate is void, because the court that rendered the decision had no jurisdiction. Reconstitution can validly be made only in case of loss of the original certificate."18In such a case, "the decision authorizing the issuance of a new owners duplicate certificate of title may be attacked any time."19 Applying this rule, it is apparent that the second owners duplicate copy of TCT No. T -2857 issued upon the petition of Frisco Gudani was void. Further, the certificates of title (TCT No. T-128605 in the name of Frisco Gudani, TCT No. T-128606 in the name of Eduardo Victa and TCT No. T-128607 in the names of petitioners) that were subsequently issued covering the subject lots may be nullified because they all emanated from a void document, i.e., the second owners duplicate copy of TCT No. T-2857 that was procured by Frisco Gudani, or more particularly by Atty. Aguilan, in behalf of Frisco Gudani, through fraud. Transfer certificates of title may be annulled if issued based on void documents.20 Petitioners cannot raise the defense of indefeasibility of a Torrens title with respect to TCT No. T-168607 because "the principle of indefeasibility of a Torrens title does not apply where fraud attended the issuance of the title. The Torrens title does not furnish a shield for fraud." 21 They cannot deny any knowledge of the fraud that attended the transactions involving the subject lots, including their acquisition thereof. Stated differently, petitioners cannot claim that they were purchasers in good faith and for value because the transactions involving the subject lots were so replete with badges of fraud and irregularities that should have put them on guard about the defects in the respective titles of Frisco Gudani and Eduardo Victa. To recall, TCT No. T-2857 was cancelled and, in lieu thereof, TCT No. T-128605 was issued in the name of Frisco Gudani, on February 10, 1975. The latter was thereafter cancelled by TCT No. T-128606 issued in the name of Eduardo Victa also on February 10, 1975. The latter certificate of title, in turn, was cancelled by TCT No. T-128607 issued in the name of the spouses Rodriguez also on February 10, 1975. These highly irregular transfers of ownership, i.e., cancellation and/or issuance of certificates of title, involving the subject lots all transpiring on the same date eloquently betray the fraud that attended the transactions, including petitioners acquisition thereof. It is certainly unlikely that petitioners had no knowledge of these fraudulent transactions. Petitioners claim of being purchasers in good faith a nd for value was debunked by the court a quo, thus: Defendant spouses, under the premises, cannot avail of the protective mantle of law protecting a purchaser for value and in good faith, as they are not purchasers for value and neither have they acted in good faith. Defendants cannot successfully put up a picture of innocence as to the fraud that characterized the transactions relative to their ultimate acquisition of the properties subject of this litigation. Defendant Reynaldo Rodriguez was well aware that on his acquisition of the properties, Pablo Goyma Lim, Jr. will file suit against him that is why he retained P10,000.00 of the purchase price, which amount is intended to be used in the expected litigation. In fact, defendant Reynaldo Rodriguez admitted to Frisco Gudani that he purchased the properties at a very low price because of which he promised to give Frisco Gudani an additional amount of P1,500.00 upon the termination of the case.22 On this point, the appellate court succinctly stated that "as to the contention that appellants (referring to petitioners) purchased the properties in good faith and for value, the record is replete with evidence negating such contention and the issue had been thoroughly discussed in the appealed decision which would render any further discussion a superfluity."23 Contrary to the petitioners contention, Eduardo Victa and Frisco Gudani are not indispensable parties.1wphi1 The complaint filed by Pablo Goyma Lim, Jr. was for the cancellation of TCT No. T-128607 in the name of petitioners and to enjoin them from entering the subject lots. The following discussion on who is or is not an indispensable party is apropos: An indispensable party is one whose interest will be affected by the courts action in the litigation, and without whom no final determination of the case can be had. The partys interest in the subject matter of the suit and in the relief sought are so inextricably intertwined with the other parties that his legal presence as a party to the proceeding is an absolute necessity. In his absence there cannot be a resolution of the dispute of the parties before the court which is effective, complete, or equitable. Conversely, a party is not indispensable to the suit if his interest in the controversy or subject matter is distinct and divisible from the interest of the other parties and will not necessarily be prejudiced by a judgment which does complete justice to the parties in court. He is not indispensable if his presence would merely permit complete relief between him and those already parties to the action or will simply avoid multiple litigation.24

A final determination could be had in the complaint for cancellation of TCT No. T-128607 and injunction even without Eduardo Victa and Frisco Gudani. Only the petitioners are indispensable parties therein and their insistence that Eduardo Victa and Frisco Gudani should likewise be impleaded deserves scant consideration. Having established that petitioners TCT No. T-128607 emanated from a void document, i.e. the second owners duplicate copy of TCT No. T-2857 procured by Frisco Gudani and/or Atty. Aguilan through fraud and when Domingas owners duplicate certificate of title had not been lost, and that petitioners were not purchasers i n good faith and for value, the Court concludes that the nullification of petitioners TCT No. T -128607 is warranted under the circumstances. The appellate court therefore committed no reversible error in affirming the decision of the court a quo which, among others, declared as null and void TCT No. T-128607 in the name of petitioners and, instead, reinstated TCT No. T-2857 in the name of Dominga Goyma, mother of Pablo Goyma Lim, Jr. (now substituted by his spouse and children) respondents Concordia Ong Lim, Eurestes and Elmer Lim. The Court finds it unnecessary, at this point, to determine the successional rights, if any, of Frisco Gudani to the properties left by Dominga Goyma. Such matter is better threshed out in the proper special proceedings for the settlement of the intestate estate of Dominga Goyma. As held by this Court, matters which involve settlement and distribution of the estate of the decedent fall within the exclusive province of the probate court in the exercise of its limited jurisdiction.25 WHEREFORE, the petition is DENIED. The Decision dated July 18, 1995 and Resolution dated October 5, 1998 of the Court of Appeals in CA-G.R. CV No. 27440 are AFFIRMED in toto. SO ORDERED.

G.R. No. 167707 October 8, 2008 THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, THE REGIONAL EXECUTIVE DIRECTOR, DENR-REGION VI, REGIONAL TECHNICAL DIRECTOR FOR LANDS, LANDS MANAGEMENT BUREAU, REGION VI PROVINCIAL ENVIRONMENT AND NATURAL RESOURCES OFFICER OF KALIBO, AKLAN, REGISTER OF DEEDS, DIRECTOR OF LAND REGISTRATION AUTHORITY, DEPARTMENT OF TOURISM SECRETARY, DIRECTOR OF PHILIPPINE TOURISM AUTHORITY, petitioners, vs. MAYOR JOSE S. YAP, LIBERTAD TALAPIAN, MILA Y. SUMNDAD, and ANICETO YAP, in their behalf and in behalf of all those similarly situated, respondents. x-------------------------x G.R. No. G.R. No. 173775 October 8, 2008 DR. ORLANDO SACAY and WILFREDO GELITO, joined by THE LANDOWNERS OF BORACAY SIMILARLY SITUATED NAMED IN A LIST, ANNEX A OF THIS PETITION, petitioners, vs. THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, THE REGIONAL TECHNICAL DIRECTOR FOR LANDS, LANDS MANAGEMENT BUREAU, REGION VI, PROVINCIAL ENVIRONMENT AND NATURAL RESOURCES OFFICER, KALIBO, AKLAN, respondents. AT stake in these consolidated cases is the right of the present occupants of Boracay Island to secure titles over their occupied lands. There are two consolidated petitions. The first is G.R. No. 167707, a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) affirming that 2 of the Regional Trial Court (RTC) in Kalibo, Aklan, which granted the petition for declaratory relief filed by respondents-claimants Mayor Jose Yap, et al. and ordered the survey of Boracay for titling purposes. The second is G.R. No. 173775, a petition for prohibition, mandamus, and nullification of Proclamation No. 10645>[3] issued by President Gloria Macapagal -Arroyo classifying Boracay into reserved forest and agricultural land. The Antecedents G.R. No. 167707 Boracay Island in the Municipality of Malay, Aklan, with its powdery white sand beaches and warm crystalline waters, is reputedly a premier Philippine tourist destination. The island is also home to 12,003 inhabitants 4 who live in the bone-shaped islands three barangays.5 On April 14, 1976, the Department of Environment and Natural Resources (DENR) approved the National Reservation Survey of Boracay Island,6 which identified several lots as being occupied or claimed by named persons.7 On November 10, 1978, then President Ferdinand Marcos issued Proclamation No. 18018 declaring Boracay Island, among other islands, caves and peninsulas in the Philippines, as tourist zones and marine reserves under the administration of the Philippine Tourism Authority (PTA). President Marcos later approved the issuance of PTA Circular 3-829 dated September 3, 1982, to implement Proclamation No. 1801. Claiming that Proclamation No. 1801 and PTA Circular No 3-82 precluded them from filing an application for judicial confirmation of imperfect title or survey of land for titling purposes, respondents-claimants Mayor Jose S. Yap, Jr., Libertad Talapian, Mila Y. Sumndad, and Aniceto Yap filed a petition for declaratory relief with the RTC in Kalibo, Aklan. In their petition, respondents-claimants alleged that Proclamation No. 1801 and PTA Circular No. 3-82 raised doubts on their right to secure titles over their occupied lands. They declared that they themselves, or through their predecessors-in-interest, had been in open, continuous, exclusive, and notorious possession and occupation in Boracay since June 12, 1945, or earlier since time immemorial. They declared their lands for tax purposes and paid realty taxes on them.10 Respondents-claimants posited that Proclamation No. 1801 and its implementing Circular did not place Boracay beyond the commerce of man. Since the Island was classified as a tourist zone, it was susceptible of private ownership. Under Section 48(b) of Commonwealth Act (CA) No. 141, otherwise known as the Public Land Act, they had the right to have the lots registered in their names through judicial confirmation of imperfect titles. The Republic, through the Office of the Solicitor General (OSG), opposed the petition for declaratory relief. The OSG countered that Boracay Island was an unclassified land of the public domain. It formed part of the mass of lands classified as public forest, which was not available for disposition pursuant to Section 3(a) of Presidential Decree (PD) No. 705 or the Revised Forestry Code,11 as amended. The OSG maintained that respondents-claimants reliance on PD No. 1801 and PTA Circular No. 3 -82 was misplaced. Their right to judicial confirmation of title was governed by CA No. 141 and PD No. 705. Since Boracay Island had not been classified as alienable and disposable, whatever possession they had cannot ripen into ownership. During pre-trial, respondents-claimants and the OSG stipulated on the following facts: (1) respondentsclaimants were presently in possession of parcels of land in Boracay Island; (2) these parcels of land were planted with coconut trees and other natural growing trees; (3) the coconut trees had heights of more or less twenty (20) meters and were planted more or less fifty (50) years ago; and (4) respondents-claimants declared the land they were occupying for tax purposes.12 The parties also agreed that the principal issue for resolution was purely legal: whether Proclamation No. 1801 posed any legal hindrance or impediment to the titling of the lands in Boracay. They decided to forego with the trial and to submit the case for resolution upon submission of their respective memoranda. 13 The RTC took judicial notice14 that certain parcels of land in Boracay Island, more particularly Lots 1 and 30, Plan PSU-5344, were covered by Original Certificate of Title No. 19502 (RO 2222) in the name of the Heirs of

Ciriaco S. Tirol. These lots were involved in Civil Case Nos. 5222 and 5262 filed before the RTC of Kalibo, Aklan.15 The titles were issued on August 7, 1933.16 RTC and CA Dispositions On July 14, 1999, the RTC rendered a decision in favor of respondents-claimants, with a fallo reading: WHEREFORE, in view of the foregoing, the Court declares that Proclamation No. 1801 and PTA Circular No. 3-82 pose no legal obstacle to the petitioners and those similarly situated to acquire title to their lands in Boracay, in accordance with the applicable laws and in the manner prescribed therein; and to have their lands surveyed and approved by respondent Regional Technical Director of Lands as the approved survey does not in itself constitute a title to the land. SO ORDERED.17 The RTC upheld respondents-claimants right to have their occupied lands titled in their name. It ruled that neither Proclamation No. 1801 nor PTA Circular No. 3-82 mentioned that lands in Boracay were inalienable or could not be the subject of disposition.18 The Circular itself recognized private ownership of lands.19 The trial court cited Sections 8720 and 5321 of the Public Land Act as basis for acknowledging private ownership of lands in Boracay and that only those forested areas in public lands were declared as part of the forest reserve.22 The OSG moved for reconsideration but its motion was denied.23 The Republic then appealed to the CA. On December 9, 2004, the appellate court affirmed in toto the RTC decision, disposing as follows: WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by us DENYING the appeal filed in this case and AFFIRMING the decision of the lower court.24 The CA held that respondents-claimants could not be prejudiced by a declaration that the lands they occupied since time immemorial were part of a forest reserve. Again, the OSG sought reconsideration but it was similarly denied.25 Hence, the present petition under Rule 45. G.R. No. 173775 On May 22, 2006, during the pendency of G.R. No. 167707, President Gloria Macapagal-Arroyo issued Proclamation No. 106426 classifying Boracay Island into four hundred (400) hectares of reserved forest land (protection purposes) and six hundred twenty-eight and 96/100 (628.96) hectares of agricultural land (alienable and disposable). The Proclamation likewise provided for a fifteen-meter buffer zone on each side of the centerline of roads and trails, reserved for right-of-way and which shall form part of the area reserved for forest land protection purposes. On August 10, 2006, petitioners-claimants Dr. Orlando Sacay,27 Wilfredo Gelito,28 and other landowners29 in Boracay filed with this Court an original petition for prohibition, mandamus, and nullification of Proclamation No. 1064.30 They allege that the Proclamation infringed on their prior vested rights over portions of Boracay. They have been in continued possession of their respective lots in Boracay since time immemorial. They have also invested billions of pesos in developing their lands and building internationally renowned first class resorts on their lots.31 Petitioners-claimants contended that there is no need for a proclamation reclassifying Boracay into agricultural land. Being classified as neither mineral nor timber land, the island is deemed agricultural pursuant to the Philippine Bill of 1902 and Act No. 926, known as the first Public Land Act. 32 Thus, their possession in the concept of owner for the required period entitled them to judicial confirmation of imperfect title. Opposing the petition, the OSG argued that petitioners-claimants do not have a vested right over their occupied portions in the island. Boracay is an unclassified public forest land pursuant to Section 3(a) of PD No. 705. Being public forest, the claimed portions of the island are inalienable and cannot be the subject of judicial confirmation of imperfect title. It is only the executive department, not the courts, which has authority to reclassify lands of the public domain into alienable and disposable lands. There is a need for a positive government act in order to release the lots for disposition. On November 21, 2006, this Court ordered the consolidation of the two petitions as they principally involve the same issues on the land classification of Boracay Island.33 Issues G.R. No. 167707 The OSG raises the lone issue of whether Proclamation No. 1801 and PTA Circular No. 3-82 pose any legal obstacle for respondents, and all those similarly situated, to acquire title to their occupied lands in Boracay Island.34 G.R. No. 173775 Petitioners-claimants hoist five (5) issues, namely: I. AT THE TIME OF THE ESTABLISHED POSSESSION OF PETITIONERS IN CONCEPT OF OWNER OVER THEIR RESPECTIVE AREAS IN BORACAY, SINCE TIME IMMEMORIAL OR AT THE LATEST SINCE 30 YRS. PRIOR TO THE FILING OF THE PETITION FOR DECLARATORY RELIEF ON NOV. 19, 1997, WERE THE AREAS OCCUPIED BY THEM PUBLIC AGRICULTURAL LANDS AS DEFINED BY LAWS THEN ON JUDICIAL CONFIRMATION OF IMPERFECT TITLES OR PUBLIC FOREST AS DEFINED BY SEC. 3a, PD 705? II. HAVE PETITIONERS OCCUPANTS ACQUIRED PRIOR VESTED RIGHT OF PRIVATE OWNERSHIPOVER THEIR OCCUPIED PORTIONS OF BORACAY LAND, DESPITE THE FACT THAT THEY HAVE NOT APPLIED YET FOR JUDICIAL CONFIRMATION OF IMPERFECT TITLE? III. IS THE EXECUTIVE DECLARATION OF THEIR AREAS AS ALIENABLE AND DISPOSABLE UNDER SEC 6, CA 141 [AN] INDISPENSABLE PRE-REQUISITE FOR PETITIONERS TO OBTAIN TITLEUNDER THE TORRENS SYSTEM?

IV. IS THE ISSUANCE OF PROCLAMATION 1064 ON MAY 22, 2006, VIOLATIVE OF THE PRIOR VESTED RIGHTS TO PRIVATE OWNERSHIP OF PETITIONERS OVER THEIR LANDS IN BORACAY, PROTECTED BY THE DUE PROCESS CLAUSE OF THE CONSTITUTION OR IS PROCLAMATION 1064 CONTRARY TO SEC. 8, CA 141, OR SEC. 4(a) OF RA 6657. V. CAN RESPONDENTS BE COMPELLED BY MANDAMUS TO ALLOW THE SURVEY AND TO APPROVE THE SURVEY PLANS FOR PURPOSES OF THE APPLICATION FOR TITLING OF THE LANDS OF PETITIONERS IN BORACAY?35 (Underscoring supplied) In capsule, the main issue is whether private claimants (respondents-claimants in G.R. No. 167707 and petitioners-claimants in G.R. No. 173775) have a right to secure titles over their occupied portions in Boracay. The twin petitions pertain to their right, if any, to judicial confirmation of imperfect title under CA No. 141, as amended. They do not involve their right to secure title under other pertinent laws. Our Ruling Regalian Doctrine and power of the executive to reclassify lands of the public domain Private claimants rely on three (3) laws and executive acts in their bid for judicial confirmation of imperfect title, namely: (a) Philippine Bill of 190236 in relation to Act No. 926, later amended and/or superseded by Act No. 2874 and CA No. 141;37 (b) Proclamation No. 180138 issued by then President Marcos; and (c) Proclamation No. 106439 issued by President Gloria Macapagal-Arroyo. We shall proceed to determine their rights to apply for judicial confirmation of imperfect title under these laws and executive acts. But first, a peek at the Regalian principle and the power of the executive to reclassify lands of the public domain. The 1935 Constitution classified lands of the public domain into agricultural, forest or timber. 40 Meanwhile, the 1973 Constitution provided the following divisions: agricultural, industrial or commercial, residential, resettlement, mineral, timber or forest and grazing lands, and such other classes as may be provided by law,41 giving the government great leeway for classification.42 Then the 1987 Constitution reverted to the 1935 Constitution classification with one addition: national parks. 43 Of these, only agricultural lands may be alienated.44 Prior to Proclamation No. 1064 of May 22, 2006, Boracay Island had never been expressly and administratively classified under any of these grand divisions. Boracay was an unclassified land of the public domain. The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the source of any asserted right to ownership of land and charged with the conservation of such patrimony. 45 The doctrine has been consistently adopted under the 1935, 1973, and 1987 Constitutions.46 All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State.47Thus, all lands that have not been acquired from the government, either by purchase or by grant, belong to the State as part of the inalienable public domain. 48 Necessarily, it is up to the State to determine if lands of the public domain will be disposed of for private ownership. The government, as the agent of the state, is possessed of the plenary power as the persona in law to determine who shall be the favored recipients of public lands, as well as under what terms they may be granted such privilege, not excluding the placing of obstacles in the way of their exercise of what otherwise would be ordinary acts of ownership. 49 Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of the Philippines, ownership of all lands, territories and possessions in the Philippines passed to the Spanish Crown. 50 The Regalian doctrine was first introduced in the Philippines through the Laws of the Indies and the Royal Cedulas, which laid the foundation that all lands that were not acquired from the Government, either by purchase or by grant, belong to the public domain.51 The Laws of the Indies was followed by the Ley Hipotecaria or the Mortgage Law of 1893. The Spanish Mortgage Law provided for the systematic registration of titles and deeds as well as possessory claims.52 The Royal Decree of 1894 or the Maura Law 53 partly amended the Spanish Mortgage Law and the Laws of the Indies. It established possessory information as the method of legalizing possession of vacant Crown land, under certain conditions which were set forth in said decree.54 Under Section 393 of the Maura Law, an informacion posesoria or possessory information title,55 when duly inscribed in the Registry of Property, is converted into a title of ownership only after the lapse of twenty (20) years of uninterrupted possession which must be actual, public, and adverse,56 from the date of its inscription.57 However, possessory information title had to be perfected one year after the promulgation of the Maura Law, or until April 17, 1895. Otherwise, the lands would revert to the State.58 In sum, private ownership of land under the Spanish regime could only be founded on royal concessions which took various forms, namely: (1) titulo real or royal grant; (2) concesion especial or special grant; (3) composicion con el estado or adjustment title; (4) titulo de compra or title by purchase; and (5) informacion posesoria or possessory information title.59> The first law governing the disposition of public lands in the Philippines under American rule was embodied in the Philippine Bill of 1902.60 By this law, lands of the public domain in the Philippine Islands were classified into three (3) grand divisions, to wit: agricultural, mineral, and timber or forest lands.61 The act provided for, among others, the disposal of mineral lands by means of absolute grant (freehold system) and by lease (leasehold system).62 It also provided the definition by exclusion of agricultural public lands. 63 Interpreting the meaning of agricultural lands under the Philippine Bill of 1902, the Court declared in Mapa v. Insular Government:64 x x x In other words, that the phrase agricultural land as used in Act No. 926 means those public lands acquired from Spain which are not timber or mineral lands. x x x65 (Emphasis Ours)

On February 1, 1903, the Philippine Legislature passed Act No. 496, otherwise known as the Land Registration Act. The act established a system of registration by which recorded title becomes absolute, indefeasible, and imprescriptible. This is known as the Torrens system.66 Concurrently, on October 7, 1903, the Philippine Commission passed Act No. 926, which was the first Public Land Act. The Act introduced the homestead system and made provisions for judicial and administrative confirmation of imperfect titles and for the sale or lease of public lands. It permitted corporations regardless of the nationality of persons owning the controlling stock to lease or purchase lands of the public domain. 67 Under the Act, open, continuous, exclusive, and notorious possession and occupation of agricultural lands for the next ten (10) years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title. 68 On November 29, 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as the second Public Land Act. This new, more comprehensive law limited the exploitation of agricultural lands to Filipinos and Americans and citizens of other countries which gave Filipinos the same privileges. For judicial confirmation of title, possession and occupation en concepto dueo since time immemorial, or since July 26, 1894, was required.69 After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on December 1, 1936. To this day, CA No. 141, as amended, remains as the existing general law governing the classification and disposition of lands of the public domain other than timber and mineral lands, 70 and privately owned lands which reverted to the State.71 Section 48(b) of CA No. 141 retained the requirement under Act No. 2874 of possession and occupation of lands of the public domain since time immemorial or since July 26, 1894. However, this provision was superseded by Republic Act (RA) No. 1942,72 which provided for a simple thirty-year prescriptive period for judicial confirmation of imperfect title. The provision was last amended by PD No. 1073,73 which now provides for possession and occupation of the land applied for since June 12, 1945, or earlier.74 The issuance of PD No. 89275 on February 16, 1976 discontinued the use of Spanish titles as evidence in land registration proceedings.76 Under the decree, all holders of Spanish titles or grants should apply for registration of their lands under Act No. 496 within six (6) months from the effectivity of the decree on February 16, 1976. Thereafter, the recording of all unregistered lands77 shall be governed by Section 194 of the Revised Administrative Code, as amended by Act No. 3344. On June 11, 1978, Act No. 496 was amended and updated by PD No. 1529, known as the Property Registration Decree. It was enacted to codify the various laws relative to registration of property. 78 It governs registration of lands under the Torrens system as well as unregistered lands, including chattel mortgages.79 A positive act declaring land as alienable and disposable is required. In keeping with the presumption of State ownership, the Court has time and again emphasized that there must be a positive act of the government, such as an official proclamation,80 declassifying inalienable public land into disposable land for agricultural or other purposes.81 In fact, Section 8 of CA No. 141 limits alienable or disposable lands only to those lands which have been officially delimited and classified.82 The burden of proof in overcoming the presumption of State ownership of the lands of the public domain is on the person applying for registration (or claiming ownership), who must prove that the land subject of the application is alienable or disposable.83 To overcome this presumption, incontrovertible evidence must be established that the land subject of the application (or claim) is alienable or disposable. 84 There must still be a positive act declaring land of the public domain as alienable and disposable. To prove that the land subject of an application for registration is alienable, the applicant must establish the existence of a positive act of the government such as a presidential proclamation or an executive order; an administrative action; investigation reports of Bureau of Lands investigators; and a legislative act or a statute.85 The applicant may also secure a certification from the government that the land claimed to have been possessed for the required number of years is alienable and disposable.86 In the case at bar, no such proclamation, executive order, administrative action, report, statute, or certification was presented to the Court. The records are bereft of evidence showing that, prior to 2006, the portions of Boracay occupied by private claimants were subject of a government proclamation that the land is alienable and disposable. Absent such well-nigh incontrovertible evidence, the Court cannot accept the submission that lands occupied by private claimants were already open to disposition before 2006. Matters of land classification or reclassification cannot be assumed. They call for proof. 87 Ankron and De Aldecoa did not make the whole of Boracay Island, or portions of it, agricultural lands. Private claimants posit that Boracay was already an agricultural land pursuant to the old cases Ankron v. Government of the Philippine Islands (1919)88 and De Aldecoa v. The Insular Government (1909).89 These cases were decided under the provisions of the Philippine Bill of 1902 and Act No. 926. There is a statement in these old cases that in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown.90 Private claimants reliance on Ankron and De Aldecoa is misplaced. These cases did not have the effect of converting the whole of Boracay Island or portions of it into agricultural lands. It should be stressed that the Philippine Bill of 1902 and Act No. 926 merely provided the manner through which land registration courts would classify lands of the public domain. Whether the land would be classified as timber, mineral, or agricultural depended on proof presented in each case. Ankron and De Aldecoa were decided at a time when the President of the Philippines had no power to classify lands of the public domain into mineral, timber, and agricultural. At that time, the courts were free to make corresponding classifications in justiciable cases, or were vested with implicit power to do so, depending upon the preponderance of the evidence.91 This was the Courts ruling in Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols Vda. De Palanca v. Republic ,92 in which it stated, through Justice Adolfo Azcuna, viz.:

x x x Petitioners furthermore insist that a particular land need not be formally released by an act of the Executive before it can be deemed open to private ownership, citing the cases of Ramos v. Director of Lands and Ankron v. Government of the Philippine Islands. xxxx Petitioners reliance upon Ramos v. Director of Lands and Ankron v. Government is misplaced. These cases were decided under the Philippine Bill of 1902 and the first Public Land Act No. 926 enacted by the Philippine Commission on October 7, 1926, under which there was no legal provision vesting in the Chief Executive or President of the Philippines the power to classify lands of the public domain into mineral, timber and agricultural so that the courts then were free to make corresponding classifications in justiciable cases, or were vested with implicit power to do so, depending upon the preponderance of the evidence.93 To aid the courts in resolving land registration cases under Act No. 926, it was then necessary to devise a presumption on land classification. Thus evolved the dictum in Ankron that the courts have a right to presume, in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown.94 But We cannot unduly expand the presumption in Ankron and De Aldecoa to an argument that all lands of the public domain had been automatically reclassified as disposable and alienable agricultural lands. By no stretch of imagination did the presumption convert all lands of the public domain into agricultural lands. If We accept the position of private claimants, the Philippine Bill of 1902 and Act No. 926 would have automatically made all lands in the Philippines, except those already classified as timber or mineral land, alienable and disposable lands. That would take these lands out of State ownership and worse, would be utterly inconsistent with and totally repugnant to the long-entrenched Regalian doctrine. The presumption in Ankron and De Aldecoa attaches only to land registration cases brought under the provisions of Act No. 926, or more specifically those cases dealing with judicial and administrative confirmation of imperfect titles. The presumption applies to an applicant for judicial or administrative conformation of imperfect title under Act No. 926. It certainly cannot apply to landowners, such as private claimants or their predecessors-in-interest, who failed to avail themselves of the benefits of Act No. 926. As to them, their land remained unclassified and, by virtue of the Regalian doctrine, continued to be owned by the State. In any case, the assumption in Ankron and De Aldecoa was not absolute. Land classification was, in the end, dependent on proof. If there was proof that the land was better suited for non-agricultural uses, the courts could adjudge it as a mineral or timber land despite the presumption. In Ankron, this Court stated: In the case of Jocson vs. Director of Forestry (supra), the Attorney-General admitted in effect that whether the particular land in question belongs to one class or another is a question of fact. The mere fact that a tract of land has trees upon it or has mineral within it is not of itself sufficient to declare that one is forestry land and the other, mineral land. There must be some proof of the extent and present or future value of the forestry and of the minerals. While, as we have just said, many definitions have been given for agriculture, forestry, and mineral lands, and that in each case it is a question of fact, we think it is safe to say that in order to be forestry or mineral land the proof must show that it is more valuable for the forestry or the mineral which it contains than it is for agricultural purposes. (Sec. 7, Act No. 1148.) It is not sufficient to show that there exists some trees upon the land or that it bears some mineral. Land may be classified as forestry or mineral today, and, by reason of the exhaustion of the timber or mineral, be classified as agricultural land tomorrow. And vice-versa, by reason of the rapid growth of timber or the discovery of valuable minerals, lands classified as agricultural today may be differently classified tomorrow. Each case must be decided upon the proof in that particular case, having regard for its present or future value for one or the other purposes. We believe, however, considering the fact that it is a matter of public knowledge that a majority of the lands in the Philippine Islands are agricultural lands that the courts have a right to presume, in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown. Whatever the land involved in a particular land registration case is forestry or mineral land must, therefore, be a matter of proof. Its superior value for one purpose or the other is a question of fact to be settled by the proof in each particular case. The fact that the land is a manglar [mangrove swamp] is not sufficient for the courts to decide whether it is agricultural, forestry, or mineral land. It may perchance belong to one or the other of said classes of land. The Government, in the first instance, under the provisions of Act No. 1148, may, by reservation, decide for itself what portions of public land shall be considered forestry land, unless private interests have intervened before such reservation is made. In the latter case, whether the land is agricultural, forestry, or mineral, is a question of proof. Until private interests have intervened, the Government, by virtue of the terms of said Act (No. 1148), may decide for itself what portions of the public domain shall be set aside and reserved as forestry or mineral land. (Ramos vs. Director of Lands, 39 Phil. 175; Jocson vs. Director of Forestry, supra)95 (Emphasis ours) Since 1919, courts were no longer free to determine the classification of lands from the facts of each case, except those that have already became private lands.96 Act No. 2874, promulgated in 1919 and reproduced in Section 6 of CA No. 141, gave the Executive Department, through the President, the exclusive prerogative to classify or reclassify public lands into alienable or disposable, mineral or forest.96-a Since then, courts no longer had the authority, whether express or implied, to determine the classification of lands of the public domain. 97 Here, private claimants, unlike the Heirs of Ciriaco Tirol who were issued their title in 1933,98 did not present a justiciable case for determination by the land registration court of the propertys land classification. Simply put, there was no opportunity for the courts then to resolve if the land the Boracay occupants are now claiming were agricultural lands. When Act No. 926 was supplanted by Act No. 2874 in 1919, without an application for judicial confirmation having been filed by private claimants or their predecessors-in-interest, the courts were no longer authorized to determine the propertys land classification. Hence, private claimants cannot bank on Act No. 926.

We note that the RTC decision99 in G.R. No. 167707 mentioned Krivenko v. Register of Deeds of Manila, 100 which was decided in 1947 when CA No. 141, vesting the Executive with the sole power to classify lands of the public domain was already in effect. Krivenko cited the old cases Mapa v. Insular Government,101 De Aldecoa v. The Insular Government,102 and Ankron v. Government of the Philippine Islands.103 Krivenko, however, is not controlling here because it involved a totally different issue. The pertinent issue inKrivenko was whether residential lots were included in the general classification of agricultural lands; and if so, whether an alien could acquire a residential lot. This Court ruled that as an alien, Krivenko was prohibited by the 1935 Constitution104 from acquiring agricultural land, which included residential lots. Here, the issue is whether unclassified lands of the public domain are automatically deemed agricultural. Notably, the definition of agricultural public lands mentioned in Krivenko relied on the old cases decided prior to the enactment of Act No. 2874, including Ankron and De Aldecoa.105 As We have already stated, those cases cannot apply here, since they were decided when the Executive did not have the authority to classify lands as agricultural, timber, or mineral. Private claimants continued possession under Act No. 926 does not create a presumption that the land is alienable. Private claimants also contend that their continued possession of portions of Boracay Island for the requisite period of ten (10) years under Act No. 926106 ipso facto converted the island into private ownership. Hence, they may apply for a title in their name. A similar argument was squarely rejected by the Court in Collado v. Court of Appeals.107 Collado, citing the separate opinion of now Chief Justice Reynato S. Puno in Cruz v. Secretary of Environment and Natural Resources,107-a ruled: Act No. 926, the first Public Land Act, was passed in pursuance of the provisions of the Philippine Bill of 1902. The law governed the disposition of lands of the public domain. It prescribed rules and regulations for the homesteading, selling and leasing of portions of the public domain of the Philippine Islands, and prescribed the terms and conditions to enable persons to perfect their titles to public lands in the Islands. It also provided for the issuance of patents to certain native settlers upon public lands, for th e establishment of town sites and sale of lots therein, for the completion of imperfect titles, and for the cancellation or confirmation of Spanish concessions and grants in the Islands. In short, the Public Land Act operated on the assumption that title to public lands in the Philippine Islands remained in the government; and that the governments title to public land sprung from the Treaty of Paris and other subsequent treaties between Spain and the United States. The term public land referred to all l ands of the public domain whose title still remained in the government and are thrown open to private appropriation and settlement, and excluded the patrimonial property of the government and the friar lands. Thus, it is plain error for petitioners to argue that under the Philippine Bill of 1902 and Public Land Act No. 926, mere possession by private individuals of lands creates the legal presumption that the lands are alienable and disposable.108 (Emphasis Ours) Except for lands already covered by existing titles, Boracay was an unclassified land of the public domain prior to Proclamation No. 1064. Such unclassified lands are considered public forest under PD No. 705. The DENR109 and the National Mapping and Resource Information Authority 110 certify that Boracay Island is an unclassified land of the public domain. PD No. 705 issued by President Marcos categorized all unclassified lands of the public domain as public forest. Section 3(a) of PD No. 705 defines a public forest as a mass of lands of the public domain which has not been the subject of the present system of classification for the determination of which lands are needed for forest purpose and which are not. Applying PD No. 705, all unclassified lands, including those in Boracay Island, are ipso factoconsidered public forests. PD No. 705, however, respects titles already existing prior to its effectivity. The Court notes that the classification of Boracay as a forest land under PD No. 705 may seem to be out of touch with the present realities in the island. Boracay, no doubt, has been partly stripped of its forest cover to pave the way for commercial developments. As a premier tourist destination for local and foreign tourists, Boracay appears more of a commercial island resort, rather than a forest land. Nevertheless, that the occupants of Boracay have built multi-million peso beach resorts on the island;111 that the island has already been stripped of its forest cover; or that the implementation of Proclamation No. 1064 will destroy the islands tourism industry, do not negate its character as public forest. Forests, in the context of both the Public Land Act and the Constitution 112 classifying lands of the public domain into agricultural, forest or timber, mineral lands, and national parks , do not necessarily refer to large tracts of wooded land or expanses covered by dense growths of trees and underbrushes. 113 The discussion in Heirs of Amunategui v. Director of Forestry114 is particularly instructive: A forested area classified as forest land of the public domain does not lose such classification simply because loggers or settlers may have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered with grass or planted to crops by kaingin cultivators or oth er farmers. Forest lands do not have to be on mountains or in out of the way places. Swampy areas covered by mangrove trees, nipa palms, and other trees growing in brackish or sea water may also be classified as forest land. The classification is descriptive of its legal nature or status and does not have to be descriptive of what the land actually looks like. Unless and until the land classified as forest is released in an official proclamation to that effect so that it may form part of the disposable agricultural lands of the public domain, the rules on confirmation of imperfect title do not apply.115 (Emphasis supplied) There is a big difference between forest as defined in a dictionary and forest or timber land as a classification of lands of the public domain as appearing in our statutes. One is descriptive of what appears on the land while the other is a legal status, a classification for legal purposes. 116 At any rate, the Court is tasked to

determine thelegal status of Boracay Island, and not look into its physical layout. Hence, even if its forest cover has been replaced by beach resorts, restaurants and other commercial establishments, it has not been automatically converted from public forest to alienable agricultural land. Private claimants cannot rely on Proclamation No. 1801 as basis for judicial confirmation of imperfect title. The proclamation did not convert Boracay into an agricultural land. However, private claimants argue that Proclamation No. 1801 issued by then President Marcos in 1978 entitles them to judicial confirmation of imperfect title. The Proclamation classified Boracay, among other islands, as a tourist zone. Private claimants assert that, as a tourist spot, the island is susceptible of private ownership. Proclamation No. 1801 or PTA Circular No. 3-82 did not convert the whole of Boracay into an agricultural land. There is nothing in the law or the Circular which made Boracay Island an agricultural land. The reference in Circular No. 3-82 to private lands117 and areas declared as alienable and disposable118 does not by itself classify the entire island as agricultural. Notably, Circular No. 3-82 makes reference not only to private lands and areas but also to public forested lands. Rule VIII, Section 3 provides: No trees in forested private lands may be cut without prior authority from the PTA. All forested areas in public lands are declared forest reserves . (Emphasis supplied) Clearly, the reference in the Circular to both private and public lands merely recognizes that the island can be classified by the Executive department pursuant to its powers under CA No. 141. In fact, Section 5 of the Circular recognizes the then Bureau of Forest Developments authority to declare areas in the island as alienable and disposable when it provides: Subsistence farming, in areas declared as alienable and disposable by the Bureau of Forest Development. Therefore, Proclamation No. 1801 cannot be deemed the positive act needed to classify Boracay Island as alienable and disposable land. If President Marcos intended to classify the island as alienable and disposable or forest, or both, he would have identified the specific limits of each, as President Arroyo did in Proclamation No. 1064. This was not done in Proclamation No. 1801. The Whereas clauses of Proclamation No. 1801 also explain the rationale behind the declaration of Boracay Island, together with other islands, caves and peninsulas in the Philippines, as a tourist zone and marine reserve to be administered by the PTA to ensure the concentrated efforts of the public and private sectors in the development of the areas tourism potential with due regard for ecological balance in the marine environment. Simply put, the proclamation is aimed at administering the islands for tourism and ecological purposes. It does not address the areas alienability.119 More importantly, Proclamation No. 1801 covers not only Boracay Island, but sixty-four (64) other islands, coves, and peninsulas in the Philippines, such as Fortune and Verde Islands in Batangas, Port Galera in Oriental Mindoro, Panglao and Balicasag Islands in Bohol, Coron Island, Puerto Princesa and surrounding areas in Palawan, Camiguin Island in Cagayan de Oro, and Misamis Oriental, to name a few. If the designation of Boracay Island as tourist zone makes it alienable and disposable by virtue of Proclamation No. 1801, all the other areas mentioned would likewise be declared wide open for private disposition. That could not have been, and is clearly beyond, the intent of the proclamation. It was Proclamation No. 1064 of 2006 which positively declared part of Boracay as alienable and opened the same to private ownership. Sections 6 and 7 of CA No. 141120 provide that it is only the President, upon the recommendation of the proper department head, who has the authority to classify the lands of the public domain into alienable or disposable, timber and mineral lands.121 In issuing Proclamation No. 1064, President Gloria Macapagal-Arroyo merely exercised the authority granted to her to classify lands of the public domain, presumably subject to existing vested rights. Classification of public lands is the exclusive prerogative of the Executive Department, through the Office of the President. Courts have no authority to do so.122 Absent such classification, the land remains unclassified until released and rendered open to disposition.123 Proclamation No. 1064 classifies Boracay into 400 hectares of reserved forest land and 628.96 hectares of agricultural land. The Proclamation likewise provides for a 15-meter buffer zone on each side of the center line of roads and trails, which are reserved for right of way and which shall form part of the area reserved for forest land protection purposes. Contrary to private claimants argument, t here was nothing invalid or irregular, much less unconstitutional, about the classification of Boracay Island made by the President through Proclamation No. 1064. It was within her authority to make such classification, subject to existing vested rights. Proclamation No. 1064 does not violate the Comprehensive Agrarian Reform Law. Private claimants further assert that Proclamation No. 1064 violates the provision of the Comprehensive Agrarian Reform Law (CARL) or RA No. 6657 barring conversion of public forests into agricultural lands. They claim that since Boracay is a public forest under PD No. 705, President Arroyo can no longer convert it into an agricultural land without running afoul of Section 4(a) of RA No. 6657, thus: SEC. 4. Scope. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable for agriculture. More specifically, the following lands are covered by the Comprehensive Agrarian Reform Program: (a) All alienable and disposable lands of the public domain devoted to or suitable for agriculture. No reclassification of forest or mineral lands to agricultural lands shall be undertaken after the approval of this Act until Congress, taking into account ecological, developmental and equity considerations, shall have determined by law, the specific limits of the public domain.

That Boracay Island was classified as a public forest under PD No. 705 did not bar the Executive from later converting it into agricultural land. Boracay Island still remained an unclassified land of the public domain despite PD No. 705. In Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols v. Republic, 124 the Court stated that unclassified lands are public forests. While it is true that the land classification map does not categorically state that the islands are public forests, the fact that they were unclassified lands leads to the same result. In the absence of the classification as mineral or timber land, the land remains unclassified land until released and rendered open to disposition.125 (Emphasis supplied) Moreover, the prohibition under the CARL applies only to a reclassification of land. If the land had never been previously classified, as in the case of Boracay, there can be no prohibited reclassification under the agrarian law. We agree with the opinion of the Department of Justice 126 on this point: Indeed, the key word to the correct application of the prohibition in Section 4(a) is the word reclassification. Where there has been no previous classification of public forest [referring, we repeat, to the mass of the public domain which has not been the subject of the present system of classification for purposes of determining which are needed for forest purposes and which are not] into permanent forest or forest reserves or some other forest uses under the Revised Forestry Code, there can be no reclassification of forest lands to speak of within the meaning of Section 4(a). Thus, obviously, the prohibition in Section 4(a) of the CARL against the reclassification of forest lands to agricultural lands without a prior law delimiting the limits of the public domain, does not, and cannot, apply to those lands of the public domain, denominated as public forest under the Revised Forestry Code, which have not been previously determined, or classified, as needed for forest purposes in accordance with the provisions of the Revised Forestry Code.127 Private claimants are not entitled to apply for judicial confirmation of imperfect title under CA No. 141. Neither do they have vested rights over the occupied lands under the said law. There are two requisites for judicial confirmation of imperfect or incomplete title under CA No. 141, namely: (1) open, continuous, exclusive, and notorious possession and occupation of the subject land by himself or through his predecessors-in-interest under a bona fide claim of ownership since time immemorial or from June 12, 1945; and (2) the classification of the land as alienable and disposable land of the public domain.128 As discussed, the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801 did not convert portions of Boracay Island into an agricultural land. The island remained an unclassified land of the public domain and, applying the Regalian doctrine, is considered State property. Private claimants bid for judicial confirmation of imperfect title, rely ing on the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801, must fail because of the absence of the second element of alienable and disposable land. Their entitlement to a government grant under our present Public Land Act presupposes that the land possessed and applied for is already alienable and disposable. This is clear from the wording of the law itself.129Where the land is not alienable and disposable, possession of the land, no matter how long, cannot confer ownership or possessory rights.130 Neither may private claimants apply for judicial confirmation of imperfect title under Proclamation No. 1064, with respect to those lands which were classified as agricultural lands. Private claimants failed to prove the first element of open, continuous, exclusive, and notorious possession of their lands in Boracay since June 12, 1945. We cannot sustain the CA and RTC conclusion in the petition for declaratory relief that private claimants complied with the requisite period of possession. The tax declarations in the name of private claimants are insufficient to prove the first element of possession. We note that the earliest of the tax declarations in the name of private claimants were issued in 1993. Being of recent dates, the tax declarations are not sufficient to convince this Court that the period of possession and occupation commenced on June 12, 1945. Private claimants insist that they have a vested right in Boracay, having been in possession of the island for a long time. They have invested millions of pesos in developing the island into a tourist spot. They say their continued possession and investments give them a vested right which cannot be unilaterally rescinded by Proclamation No. 1064. The continued possession and considerable investment of private claimants do not automatically give them a vested right in Boracay. Nor do these give them a right to apply for a title to the land they are presently occupying. This Court is constitutionally bound to decide cases based on the evidence presented and the laws applicable. As the law and jurisprudence stand, private claimants are ineligible to apply for a judicial confirmation of title over their occupied portions in Boracay even with their continued possession and considerable investment in the island. One Last Note The Court is aware that millions of pesos have been invested for the development of Boracay Island, making it a by-word in the local and international tourism industry. The Court also notes that for a number of years, thousands of people have called the island their home. While the Court commiserates with private claimants plight, We are bound to apply the law strictly and judiciously. This is the law and it should prevail. Ito ang batas at ito ang dapat umiral. All is not lost, however, for private claimants. While they may not be eligible to apply for judicial confirmation of imperfect title under Section 48(b) of CA No. 141, as amended, this does not denote their automatic ouster from the residential, commercial, and other areas they possess now classified as agricultural. Neither will this mean the loss of their substantial investments on their occupied alienable lands. Lack of title does not necessarily mean lack of right to possess.

For one thing, those with lawful possession may claim good faith as builders of improvements. They can take steps to preserve or protect their possession. For another, they may look into other modes of applying for original registration of title, such as by homestead 131 or sales patent,132 subject to the conditions imposed by law. More realistically, Congress may enact a law to entitle private claimants to acquire title to their occupied lots or to exempt them from certain requirements under the present land laws. There is one such bill 133 now pending in the House of Representatives. Whether that bill or a similar bill will become a law is for Congress to decide. In issuing Proclamation No. 1064, the government has taken the step necessary to open up the island to private ownership. This gesture may not be sufficient to appease some sectors which view the classification of the island partially into a forest reserve as absurd. That the island is no longer overrun by trees, however, does not becloud the vision to protect its remaining forest cover and to strike a healthy balance between progress and ecology. Ecological conservation is as important as economic progress. To be sure, forest lands are fundamental to our nations survival. Their promotion and protection are not just fancy rhetoric for politicians and activists. These are needs that become more urgent as destruction of our environment gets prevalent and difficult to control. As aptly observed by Justice Conrado Sanchez in 1968 in Director of Forestry v. Munoz:134 The view this Court takes of the cases at bar is but in adherence to public policy that should be followed with respect to forest lands. Many have written much, and many more have spoken, and quite often, about the pressing need for forest preservation, conservation, protection, development and reforestation. Not without justification. For, forests constitute a vital segment of any countrys natural resources. It is of common knowledge by now that absence of the necessary green cover on our lands produces a number of adverse or ill effects of serious proportions. Without the trees, watersheds dry up; rivers and lakes which they supply are emptied of their contents. The fish disappear. Denuded areas become dust bowls. As waterfalls cease to function, so will hydroelectric plants. With the rains, the fertile topsoil is washed away; geological erosion results. With erosion come the dreaded floods that wreak havoc and destruction to property crops, livestock, houses, and highways not to mention precious human lives. Indeed, the foregoing observations should be written down in a lumbermans decalogue.135 WHEREFORE, judgment is rendered as follows: 1. The petition for certiorari in G.R. No. 167707 is GRANTED and the Court of Appeals Decision in CA-G.R. CV No. 71118 REVERSED AND SET ASIDE. 2. The petition for certiorari in G.R. No. 173775 is DISMISSED for lack of merit. SO ORDERED.

G.R. No. 151910 October 15, 2007 REPUBLIC OF THE PHILIPPINES, Petitioner, vs. LUDOLFO V. MUOZ, Respondent. Before this Court is a Petition for Review on Certiorari, under Rule 45 of the 1997 Rules of Civil Procedure, seeking to set aside the August 29, 2001 Decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 58170, as well as its January 29, 2002 Resolution, which affirmed the October 3, 1997 Decision 2 of the Regional Trial Court (RTC) of Ligao, Albay, Branch 13, granting the application for land registration of respondent Ludolfo V. Muoz. The following facts prompted the present controversy. On June 14, 1996, respondent filed an Application for Registration of Title of a parcel of residential land before the RTC of Ligao, Albay containing an area of 1,986 square meters situated, bounded, and described as follows: A PARCEL OF LAND (Lot No. 2276 of the Cadastral Survey of Ligao) with the building and improvements thereon, situated in the Barrio of Bagonbayan, Municipality of Ligao, Province of Albay. Bounded on the S., along line 1-2, by Lot No. 2277, Ligao Cadastre; on the W., along Line 2-3, by Mabini Street; on the N., and E., along lines 3-4-5-6-4-7, by Lot 2284; and on the S., along line 7-8, by Lot 2281; and along line 8-1, by Lot 2278 all of Ligao Cadastre, containing an area of ONE THOUSAND NINE HUNDRED EIGHTY SIX (1,986) square meters. 3 In his application for registration, respondent averred that no mortgage or encumbrance of any kind affects his property and that no other person has an interest, legal or equitable, on the subject lot. Respondent further declared that the property was acquired by donation inter vivos, executed by the spouses Apolonio R. Muoz and Anastacia Vitero on November 18, 1956, and that the spouses and their predecessors-in-interest have been in possession thereof since time immemorial for more than 70 years. On November 7, 1996, petitioner Republic of the Philippines, through the Office of the Solicitor General (OSG), opposed the application on the following grounds: (1) That neither the applicant nor his predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of the land in question since June 12, 1945 or prior thereto (Sec. 48[b], C.A. 141 as amended by P.D. 1073). (2) That the muniment/s of title and/or the tax payment/s receipt/s of application/s, if any, attached to or alleged in the application, do not constitute competent and sufficient evidence of a bona fide acquisition of the lands acquired for or his open, continuous, exclusive and notorious possession and occupation thereof in the concept of owner since June 12, 1945 or prior thereto. Said muniment/s of title as well as the title do not appear to be genuine and that the tax declaration/s and/or tax payment receipt/s indicate the pretended possession of application to be of recent vintage. (3) That the claim of ownership in fee simple on the basis of Spanish title or grant can no longer be availed of by the applicant who has failed to file an appropriate application for registration within the period of six (6) months from February 16, 1976 as required by P.D. No. 892. From the records, it appears that the instant application was recently filed. (4) That the parcel applied for is part of the public domain belonging to the Republic of the Philippines not subject to private appropriation. (5) That this application was filed beyond December 31, 1987, the period set forth under Sec. 2, P.D. No. 1073 and therefore, is filed out of time.4 In respondents Answer to Opposition, he professed that the land in question is a residential lot originally owned and possessed by Paulino Pulvinar and Geronimo Lozada. Sometime in April 1917, Pulvinar sold his share of the unregistered land to the spouses Muoz and Vitero, respondents parents. In June 1920, Lozada likewise sold his remaining part to the parents of respondent. Thereafter, the ownership and possession of the property were consolidated by the spouses and declared for taxation purposes in the name of Muoz in 1920. Furthermore, it was stated that during the cadastral survey conducted in Ligao, Albay in 1928, the land was designated as Lot No. 2276, as per Survey Notification Card issued to Muoz dated October 2, 1928. Finally, respondent contended that from 1920 up to 1996, the time of application, the land taxes for the property had been fully paid. On February 6, 1997, an Order of General Default5 was entered by the trial court against the whole world except for the government and a certain Alex Vasquez, who appeared during the scheduled initial hearing stating that he would file an opposition to the application. In the Opposition6 filed by Vasquez dated February 19, 1997, he declared that he owns parcels of land, Lot Nos. 2284-A-2 and 2275, adjoining that of the subject matter of the application. He added that certain portions of his lands are included in the application as respondents concrete fence is found within the area of his lots. Respondent, in his answer to the opposition,7 alleged that his property, Lot No. 2276, is covered by a technical description, duly certified correct by the Bureau of Lands and approved for registration by the Land Registration Authority (LRA), which specified the exact areas and boundaries of Lot No. 2276. Granting that there is an encroachment to the oppositors adjoining land, respondent reasoned th at it is not for the court a quo, sitting as a Land Registration Court, to entertain the opposition because the case should be ventilated in a separate proceeding as an ordinary civil case. During the trial, respondent was presented as the sole witness. Respondent, who was 81 years old at that time, testified that he acquired the property in 1956 when his parents donated the same to him. 8 He presented as Exhibit "H"9 Tax Declaration No. 048-0267, evidencing the payment of realty taxes for Lot No. 2276 in 1997. A Certification from the Office of the Municipal Treasurer10 was likewise introduced by the respondent showing the payment of real estate taxes from 1956 up to the year 1997. He further declared that the property is a residential land with improvements such as a house made of solid materials and fruit-bearing trees. In 1957,

respondent told the court that he constructed a concrete wall surrounding the entire property. Respondent also narrated that he grew up on the subject lot and spent his childhood days in the area.11 On cross-examination, respondent claimed that he has six brothers and sisters, none of whom are claiming any interest over the property.12 On June 16, 1997, the trial court noted13 a Report14 submitted by the Director of Lands, which informed the court that as per records of the Land Management Bureau in Manila, Lot No. 2276, CAD-239 is covered by Free Patent Application No. 10-2-664 of Anastacia Vitero. The RTC rendered a Decision dated October 3, 1997 granting the application for registration. The dispositive portion of the decision reads: WHEREFORE, decision is hereby rendered finding the petitioner entitled to registration. Accordingly, after the finality of this decision, let a decree and, thereafter the corresponding certificate of title over Lot No. 2276 of the Ligao Cadastre as delimited by the Technical Description, Annex A-2 of the application, together with the improvements thereon, issue in the name of LUDOLFO Y. MUOZ, of legal age, Filipino citizen, married to JOSEFINA PALENCIA, of Mabini Street, Barangay Tinago, Municipality of Ligao, Province of Albay. Conformably with the above findings, as prayed for by the Director, Department of Registration, Land Registration Authority in his Report dated March 6, 1997, the application, if any, in Cad. Case No. 53, Cadastral Record No. 1404 is hereby ordered dismissed. The opposition of Alex Vasquez for lack of merit is hereby ordered dismissed.1wphi1 Let copy of this Decision be furnished the Office of the Solicitor General, Provincial Prosecutor of Albay, Oppositor Alez Vasquez and Petitioner. SO ORDERED.15 On appeal, petitioner argued that the trial court did not acquire jurisdiction over the subject lot because: (1) the notice of initial hearing was not timely filed; (2) the applicant failed to present the original tracing cloth plan of the property sought to be registered during the trial; and (3) the applicant failed to present evidence that the land is alienable and disposable. Subsequently, the CA affirmed the decision of the court a quo. The appellate court explained that there was conclusive proof that the jurisdictional requirement of due notice had been complied with as mandated under Section 24 of Presidential Decree No. 1529. Furthermore, the failure to present in evidence the tracing cloth plan of the subject property did not deprive the lower court of its jurisdiction to act on the application in question. Lastly, the CA ruled that respondent need not adduce documentary proof that the disputed property had been declared alienable and disposable for the simple reason that the lot had once been covered by free patent application; hence, this alone is conclusive evidence that the property was already declared by the government as open for public disposition. The petitioner, through the OSG, raises the following grounds for the petition: I. THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE TRIAL COURT HAS NOT ACQUIRED JURISDICTION OVER THE CASE. II. PRIVATE RESPONDENT HAS NOT PROVEN BY COMPETENT EVIDENCE THAT THE PROPERTY IS ALIENABLE AND DISPOSABLE PROPERTY OF THE PUBLIC DOMAIN.16 Anent the first issue, petitioner maintains that the failure to present the original tracing cloth plan is a fatal omission which necessarily affected the trial courts jurisdiction to proceed with the case. It bears stressing that the "constructive seizure of land accomplished by posting of notices and processes upon all persons mentioned in notices by means of publication and sending copies to said persons by registered mailin effect gives the court jurisdiction over the lands sought to be registered."17 While petitioner correctly contends that the submission in evidence of the original tracing cloth plan is a mandatory and even a jurisdictional requirement, this Court has recognized instances of substantial compliance with this rule.18 It is true that the best evidence to identify a piece of land for registration purposes is the original tracing cloth plan from the Bureau of Lands, but blueprint copies and other evidence could also provide sufficient identification.19 In the present application for registration, respondent submitted, among other things, the following supporting documents: (1) a blueprint copy of the survey plan20 approved by the Bureau of Lands; and (2) the technical descriptions21 duly verified and approved by the Director of Lands. The Court held in Recto v. Republic22 that the blueprint copy of the cloth plan together with the lots technical description duly certified as to their correctness by the Bureau of Lands are adequate to identify the land applied for registration, thus On the first challenge, the petitioner invokes the case of Director of Lands v. Reyes, where it was held that "the original tracing cloth plan of the land applied for which must be approved by the Director of Lands was "a statutory requirement of mandatory character" for the identification of the land sought to be registered. As what was submitted was not the tracing cloth plan but only the blueprint copy of the survey plan, the respondent court should have rejected the same as insufficient. We disagree with this contention. The Court of Appeals was correct when it observed that in that case the applicant in effect "had not submitted anything at all to identify the subject property" because the blueprint presented lacked the approval of the Director of Lands. By contrast In the present case, there was considerable compliance with the requirement of the law as the subject property was sufficiently identified with the presentation of blueprint copy of Plan AS-06-000002 (San Pedro v. Director of Lands, CA-G.R. No. 65332-R, May 28, 1981). It should be noted in this connection that the Bureau of Lands has certified to the correctness of the blueprint copy of the plan including the technical description that

go with it. Hence, we cannot ignore the fact, absent in the Reyes case, that applicant has provided ample evidence to establish the identity of the subject property. (Emphasis supplied) x x x.23 Moreover, if the survey plan is approved by the Director of Lands and its correctness has not been overcome by clear, strong and convincing evidence, the presentation of the tracing cloth plan may be dispensed with.24 All the evidence on record sufficiently identified the property as the one applied for by respondent, and containing the corresponding metes and bounds as well as area. Consequently, the original tracing cloth plan need not be presented in evidence.25 Anent the second issue, petitioner stresses that in proving the alienable and disposable nature of the property, there has to be a certification from the Department of Environment and Natural Resources and Community Environment and Natural Resources Office (CENRO). The CA is of the opinion that respondent need not adduce documentary proofs that the disputed property has been declared alienable and disposable because of the fact that it had once been covered by Free Patent Application No. 10-2-664 in the name of respondents mother, which was unfortunately not acted upon by the proper authorities. The CA declares that this is proof enough that the property was declared by the government as open for public disposition. This contention was adopted by the respondent both in his Comment and Memorandum filed before the Court. Notwithstanding all the foregoing, the Court cannot sustain the argument of respondent that the subject property was already declared alienable and disposable land. Petitioner is correct when it remarked that it was erroneous for the appellate court to assume that the property in question is alienable and disposable based only on the Report dated May 21, 1997 of the Director of Lands indicating that the "land involved in said case described as Lot 2276, CAD-239 is covered by Free Patent Application No. 10-2-664 of Anastacia Vitero." It must be pointed out that in its Report 26 dated March 6, 1997, the LRA stated that: 3. This Authority is not in a position to verify whether or not the parcel of land subject of registration is already covered by land patent, previously approved isolated survey and is within forest zone. WHEREFORE, to avoid duplication in the issuance of titles covering the same parcel of land and the issuance of titles for lands within the forest zone which have not been released and classified as alienable, the foregoing is respectfully submitted to the Honorable Court with the recommendation that the Lands Management Bureau, Manila, Community Environment and Natural Resources Office, Lands Management Sector and Forest Management Bureau, all in Legazpi City, be ordered to submit a report to the Court on the status of the land applied for, to determine whether or not said land or any portion thereof, is already covered by land patent, previously approved isolated survey and is within the forest zone and that should the instant application be given due course, the application in Cad. Case No. 53, Cadastral Record No. 1404 with respect to Lot 2276 be dismissed.27 Noteworthy is the fact that neither the Director of Lands nor the LRA attested that the land subject of this proceeding is alienable or disposable. For clarity, applications for confirmation of imperfect title must be able to prove the following: (1) that the land forms part of the alienable and disposable agricultural lands of the public domain ; and (2) that they have been in open, continuous, exclusive and notorious possession and occupation of the same under a bona fide claim of ownership either since time immemorial or since June 12, 1945.28 Commonwealth Act No. 141, also known as the Public Land Act, remains to this day the existing general lawgoverning the classification and disposition of lands of the public domain, other than timber and mineral lands.29Section 6 of CA No. 141 empowers the President to classify lands of the public domain into "alienable and disposable" lands of the public domain, which prior to such classification are inalienable and outside the commerce of man. Section 7 of CA No. 141 authorizes the President to "declare what lands are open to disposition or concession." Section 8 of CA No. 141 states that the government can declare open for disposition or concession only lands that are "officially delimited and classified." Under the Regalian doctrine embodied in our Constitution, all lands of the public domain belong to the State, which is the source of any asserted right to ownership of land. Therefore, all lands not appearing to be clearly within private ownership are presumed to belong to the State. Accordingly, public lands not shown to have been reclassified or released as alienable agricultural land or alienated to a private person by the State remain part of the alienable public domain.30 As already well-settled in jurisprudence, no public land can be acquired by private persons without any grant, express or implied, from the government; and it is indispensable that the person claiming title to public land should show that his title was acquired from the State or any other mode of acquisition recognized by law.31 To prove that the land subject of an application for registration is alienable, the applicant must establish the existence of a positive act of the government such as a presidential proclamation or an executive order; an administrative action; investigation reports of Bureau of Lands investigators; and a legislative act or a statute.32The applicant may also secure a certification from the Government that the land applied for is alienable and disposable.33 In the present case, respondent failed to submit a certification from the proper government agency to prove that the land subject for registration is indeed alienable and disposable. A CENRO certificate, which respondent failed to secure, could have evidenced the alienability of the land involved. Considering that respondent has failed to convince this Court of the alienable and disposable character of the land applied for, the Court cannot approve the application for registration.

WHEREFORE, the instant petition is GRANTED. Accordingly, the decision dated August 29, 2001 of the Court of Appeals in CA-G.R. CV No. 58170, as reiterated in its resolution of January 29, 2002, is REVERSED and SET ASIDE, and the application for registration filed by respondent Ludolfo V. Muoz is DENIED. No costs. SO ORDERED.

G.R. No. L-8936 October 2, 1915 CONSUELO LEGARDA, with her husband MAURO PRIETO, plaintiffs-appellants, vs. N.M. SALEEBY, defendant-appellee. Singson, Ledesma and Lim for appellants.; D.R. Williams for appellee. From the record the following facts appear: First. That the plaintiffs and the defendant occupy, as owners, adjoining lots in the district of Ermita in the city of Manila. Second. That there exists and has existed a number of years a stone wall between the said lots. Said wall is located on the lot of the plaintiffs. Third. That the plaintiffs, on the 2d day of March, 1906, presented a petition in the Court of Land Registration for the registration of their lot. After a consideration of said petition the court, on the 25th day of October, 1906, decreed that the title of the plaintiffs should be registered and issued to them the original certificate provided for under the torrens system. Said registration and certificate included the wall. Fourth. Later the predecessor of the defendant presented a petition in the Court of Land Registration for the registration of the lot now occupied by him. On the 25th day of March, 1912, the court decreed the registration of said title and issued the original certificate provided for under the torrens system. The description of the lot given in the petition of the defendant also included said wall. Fifth. Several months later (the 13th day of December, 1912) the plaintiffs discovered that the wall which had been included in the certificate granted to them had also been included in the certificate granted to the defendant .They immediately presented a petition in the Court of Land Registration for an adjustment and correction of the error committed by including said wall in the registered title of each of said parties. The lower court however, without notice to the defendant, denied said petition upon the theory that, during the pendency of the petition for the registration of the defendant's land, they failed to make any objection to the registration of said lot, including the wall, in the name of the defendant. Sixth. That the land occupied by t he wall is registered in the name of each of the owners of the adjoining lots. The wall is not a joint wall. Under these facts, who is the owner of the wall and the land occupied by it? The decision of the lower court is based upon the theory that the action for the registration of the lot of the defendant was a judicial proceeding and that the judgment or decree was binding upon all parties who did not appear and oppose it. In other words, by reason of the fact that the plaintiffs had not opposed the registration of that part of the lot on which the wall was situate they had lost it, even though it had been theretofore registered in their name. Granting that theory to be correct one, and granting even that the wall and the land occupied by it, in fact, belonged to the defendant and his predecessors, then the same theory should be applied to the defendant himself. Applying that theory to him, he had already lost whatever right he had therein, by permitting the plaintiffs to have the same registered in their name, more than six years before. Having thus lost hid right, may he be permitted to regain it by simply including it in a petition for registration? The plaintiffs having secured the registration of their lot, including the wall, were they obliged to constantly be on the alert and to watch all the proceedings in the land court to see that some one else was not having all, or a portion of the same, registered? If that question is to be answered in the affirmative, then the whole scheme and purpose of the torrens system of land registration must fail. The real purpose of that system is to quiet title to land; to put a stop forever to any question of the legality of the title, except claims which were noted at the time of registration, in the certificate, or which may arise subsequent thereto. That being the purpose of the law, it would seem that once a title is registered the owner may rest secure, without the necessity of waiting in the portals of the court, or sitting in the "mirador de su casa," to avoid the possibility of losing his land. Of course, it can not be denied that the proceeding for the registration of land under the torrens system is judicial (Escueta vs. .Director of Lands, 16 Phil. Rep., 482). It is clothed with all the forms of an action and the result is final and binding upon all the world. It is an action in rem. (Escueta vs. Director of Lands (supra); Grey Alba vs. De la Cruz, 17 Phil. rep., 49 Roxas vs.Enriquez, 29 Phil. Rep., 31; Tyler vs. Judges, 175 Mass., 51 American Land Co. vs. Zeiss, 219 U.S., 47.) While the proceeding is judicial, it involves more in its consequences than does an ordinary action. All the world are parties, including the government. After the registration is complete and final and there exists no fraud, there are no innocent third parties who may claim an interest. The rights of all the world are foreclosed by the decree of registration. The government itself assumes the burden of giving notice to all parties. To permit persons who are parties in the registration proceeding (and they are all the world) to again litigate the same questions, and to again cast doubt upon the validity of the registered title, would destroy the very purpose and intent of the law. The registration, under the torrens system, does not give the owner any better title than he had. If he does not already have a perfect title, he can not have it registered. Fee simple titles only may be registered. The certificate of registration accumulates in open document a precise and correct statement of the exact status of the fee held by its owner. The certificate, in the absence of fraud, is the evidence of title and shows exactly the real interest of its owner. The title once registered, with very few exceptions, should not thereafter be impugned, altered, changed, modified, enlarged, or diminished, except in some direct proceeding permitted by law. Otherwise all security in registered titles would be lost. A registered title can not be altered, modified, enlarged, or diminished in a collateral proceeding and not even by a direct proceeding, after the lapse of the period prescribed by law. For the difficulty involved in the present case the Act (No. 496) providing for the registration of titles under the torrens system affords us no remedy. There is no provision in said Act giving the parties relief under

conditions like the present. There is nothing in the Act which indicates who should be the owner of land which has been registered in the name of two different persons. The rule, we think, is well settled that the decree ordering the registration of a particular parcel of land is a bar to future litigation over the same between the same parties .In view of the fact that all the world are parties, it must follow that future litigation over the title is forever barred; there can be no persons who are not parties to the action. This, we think, is the rule, except as to rights which are noted in the certificate or which arise subsequently, and with certain other exceptions which need not be dismissed at present. A title once registered can not be defeated, even by an adverse, open, and notorious possession. Registered title under the torrens system can not be defeated by prescription (section 46, Act No. 496). The title, once registered, is notice to the world. All persons must take notice. No one can plead ignorance of the registration. The question, who is the owner of land registered in the name of two different persons, has been presented to the courts in other jurisdictions. In some jurisdictions, where the "torrens" system has been adopted, the difficulty has been settled by express statutory provision. In others it has been settled by the courts. Hogg, in his excellent discussion of the "Australian Torrens System," at page 823, says: "The general rule is that in the case of two certificates of title, purporting to include the same land, the earlier in date prevails, whether the land comprised in the latter certificate be wholly, or only in part, comprised in the earlier certificate. (Oelkers vs. Merry, 2 Q.S.C.R., 193; Miller vs. Davy, 7 N.Z.R., 155; Lloyd vs. Myfield, 7 A.L.T. (V.) 48; Stevens vs. Williams, 12 V.L. R., 152; Register of Titles, vs. Esperance Land Co., 1 W.A.R., 118.)" Hogg adds however that, "if it can be very clearly ascertained by the ordinary rules of construction relating to written documents, that the inclusion of the land in the certificate of title of prior date is a mistake, the mistake may be rectified by holding the latter of the two certificates of title to be conclusive." (See Hogg on the "Australian torrens System," supra, and cases cited. See also the excellent work of Niblack in his "Analysis of the Torrens System," page 99.) Niblack, in discussing the general question, said: "Where two certificates purport to include the same land the earlier in date prevails. ... In successive registrations, where more than one certificate is issued in respect of a particular estate or interest in land, the person claiming under the prior certificates is entitled to the estate or interest; and that person is deemed to hold under the prior certificate who is the holder of, or whose claim is derived directly or indirectly from the person who was the holder of the earliest certificate issued in respect thereof. While the acts in this country do not expressly cover the case of the issue of two certificates for the same land, they provide that a registered owner shall hold the title, and the effect of this undoubtedly is that where two certificates purport to include the same registered land, the holder of the earlier one continues to hold the title" (p. 237). Section 38 of Act No. 496, provides that; "It (the decree of registration) shall be conclusive upon and against all persons, including the Insular Government and all the branches thereof, whether mentioned by name in the application, notice, or citation, or included in the general description "To all whom it may concern." Such decree shall not be opened by reason of the absence, infancy, or other disability of any person affected thereby, nor by any proceeding in any court for reversing judgments or decrees; subject, however, to the right of any person deprived of land or of any estate or interest therein by decree of registration obtained by fraud to file in the Court of Land Registration a petition for review within one year after entry of the decree (of registration), provided no innocent purchaser for value has acquired an interest. It will be noted, from said section, that the "decree of registration" shall not be opened, for any reason, in any court, except for fraud, and not even for fraud, after the lapse of one year. If then the decree of registration can not be opened for any reason, except for fraud, in a direct proceeding for that purpose, may such decree be opened or set aside in a collateral proceeding by including a portion of the land in a subsequent certificate or decree of registration? We do not believe the law contemplated that a person could be deprived of his registered title in that way. We have in this jurisdiction a general statutory provision which governs the right of the ownership of land when the same is registered in the ordinary registry in the name of two persons. Article 1473 of the Civil Code provides, among other things, that when one piece of real property had been sold to two different persons it shall belong to the person acquiring it, who first inscribes it in the registry. This rule, of course, presupposes that each of the vendees or purchasers has acquired title to the land. The real ownership in such a case depends upon priority of registration. While we do not now decide that the general provisions of the Civil Code are applicable to the Land Registration Act, even though we see no objection thereto, yet we think, in the absence of other express provisions, they should have a persuasive influence in adopting a rule for governing the effect of a double registration under said Act. Adopting the rule which we believe to be more in consonance with the purposes and the real intent of the torrens system, we are of the opinion and so decree that in case land has been registered under the Land Registration Act in the name of two different persons, the earlier in date shall prevail. In reaching the above conclusion, we have not overlooked the forceful argument of the appellee. He says, among other things; "When Prieto et al. were served with notice of the application of Teus (the predecessor of the defendant) they became defendants in a proceeding wherein he, Teus, was seeking to foreclose their right, and that of orders, to the parcel of land described in his application. Through their failure to appear and contest his right thereto, and the subsequent entry of a default judgment against them, they became irrevocably bound by the decree adjudicating such land to Teus. They had their day in court and can not set up their own omission as ground for impugning the validity of a judgment duly entered by a court of competent jurisdiction. To decide otherwise would be to hold that lands with torrens titles are above the law and beyond the jurisdiction of the courts". As was said above, the primary and fundamental purpose of the torrens system is to quiet title. If the holder of a certificate cannot rest secure in this registered title then the purpose of the law is defeated. If those

dealing with registered land cannot rely upon the certificate, then nothing has been gained by the registration and the expense incurred thereby has been in vain. If the holder may lose a strip of his registered land by the method adopted in the present case, he may lose it all. Suppose within the six years which elapsed after the plaintiff had secured their title, they had mortgaged or sold their right, what would be the position or right of the mortgagee or vendee? That mistakes are bound to occur cannot be denied, and sometimes the damage done thereby is irreparable. It is the duty of the courts to adjust the rights of the parties under such circumstances so as to minimize such damages, taking into consideration al of the conditions and the diligence of the respective parties to avoid them. In the present case, the appellee was the first negligent (granting that he was the real owner, and if he was not the real owner he can not complain) in not opposing the registration in the name of the appellants. He was a party-defendant in an action for the registration of the lot in question, in the name of the appellants, in 1906. "Through his failure to appear and to oppose such registration, and the subsequent entry of a default judgment against him, he became irrevocably bound by the decree adjudicating such land to the appellants. He had his day in court and should not be permitted to set up his own omissions as the ground for impugning the validity of a judgment duly entered by a court of competent jurisdiction." Granting that he was the owner of the land upon which the wall is located, his failure to oppose the registration of the same in the name of the appellants, in the absence of fraud, forever closes his mouth against impugning the validity of that judgment. There is no more reason why the doctrine invoked by the appellee should be applied to the appellants than to him. We have decided, in case of double registration under the Land Registration Act, that the owner of the earliest certificate is the owner of the land. That is the rule between original parties. May this rule be applied to successive vendees of the owners of such certificates? Suppose that one or the other of the parties, before the error is discovered, transfers his original certificate to an "innocent purchaser." The general rule is that the vendee of land has no greater right, title, or interest than his vendor; that he acquires the right which his vendor had, only. Under that rule the vendee of the earlier certificate would be the owner as against the vendee of the owner of the later certificate. We find statutory provisions which, upon first reading, seem to cast some doubt upon the rule that the vendee acquires the interest of the vendor only. Sections 38, 55, and 112 of Act No. 496 indicate that the vendee may acquire rights and be protected against defenses which the vendor would not. Said sections speak of available rights in favor of third parties which are cut off by virtue of the sale of the land to an "innocent purchaser." That is to say, persons who had had a right or interest in land wrongfully included in an original certificate would be unable to enforce such rights against an "innocent purchaser," by virtue of the provisions of said sections. In the present case Teus had his land, including the wall, registered in his name. He subsequently sold the same to the appellee. Is the appellee an "innocent purchaser," as that phrase is used in said sections? May those who have been deprived of their land by reason of a mistake in the original certificate in favor of Teus be deprived of their right to the same, by virtue of the sale by him to the appellee? Suppose the appellants had sold their lot, including the wall, to an "innocent purchaser," would such purchaser be included in the phrase "innocent purchaser," as the same is used in said sections? Under these examples there would be two innocent purchasers of the same land, is said sections are to be applied .Which of the two innocent purchasers, if they are both to be regarded as innocent purchasers, should be protected under the provisions of said sections? These questions indicate the difficulty with which we are met in giving meaning and effect to the phrase "innocent purchaser," in said sections. May the purchaser of land which has been included in a "second original certificate" ever be regarded as an "innocent purchaser," as against the rights or interest of the owner of the first original certificate, his heirs, assigns, or vendee? The first original certificate is recorded in the public registry. It is never issued until it is recorded. The record notice to all the world. All persons are charged with the knowledge of what it contains. All persons dealing with the land so recorded, or any portion of it, must be charged with notice of whatever it contains. The purchaser is charged with notice of every fact shown by the record and is presumed to know every fact which the record discloses .This rule is so well established that it is scarcely necessary to cite authorities in its support (Northwestern National Bank vs. Freeman, 171 U.S., 620, 629; Delvin on Real Estate, sections 710, 710 [a]). When a conveyance has been properly recorded such record is constructive notice of its contents and all interests, legal and equitable, included therein. (Grandin vs. Anderson, 15 Ohio State, 286, 289; Orvis vs. Newell, 17 Conn., 97; Buchanan vs. Intentional Bank, 78 Ill., 500; Youngs vs. Wilson, 27 N.Y., 351; McCabe vs. Grey, 20 Cal., 509; Montefiore vs. Browne, 7 House of Lords Cases, 341.) Under the rule of notice, it is presumed that the purchaser has examined every instrument of record affecting the title. Such presumption is irrebutable. He is charged with notice of every fact shown by the record and is presumed to know every fact which an examination of the record would have disclosed. This presumption cannot be overcome by proof of innocence or good faith. Otherwise the very purpose and object of the law requiring a record would be destroyed. Such presumption cannot be defeated by proof of want of knowledge of what the record contains any more than one may be permitted to show that he was ignorant of the provisions of the law. The rule that all persons must take notice of the facts which the public record contains is a rule of law. The rule must be absolute. Any variation would lead to endless confusion and useless litigation. While there is no statutory provision in force here requiring that original deeds of conveyance of real property be recorded, yet there is a rule requiring mortgages to be recorded. (Arts. 1875 and 606 of the Civil Code.) The record of a mortgage is indispensable to its validity. (Art .1875.) In the face of that statute would the courts allow a mortgage to be valid which had not been recorded, upon the plea of ignorance of the statutory provision, when third parties were interested? May a purchaser of land, subsequent to the recorded

mortgage, plead ignorance of its existence, and by reason of such ignorance have the land released from such lien? Could a purchaser of land, after the recorded mortgage, be relieved from the mortgage lien by the plea that he was abona fide purchaser? May there be a bona fide purchaser of said land, bona fide in the sense that he had no knowledge of the existence of the mortgage? We believe the rule that all persons must take notice of what the public record contains in just as obligatory upon all persons as the rule that all men must know the law; that no one can plead ignorance of the law. The fact that all men know the law is contrary to the presumption. The conduct of men, at times, shows clearly that they do not know the law. The rule, however, is mandatory and obligatory, notwithstanding. It would be just as logical to allow the defense of ignorance of the existence and contents of a public record. In view, therefore, of the foregoing rules of law, may the purchaser of land from the owner of the second original certificate be an "innocent purchaser," when a part or all of such land had theretofore been registered in the name of another, not the vendor? We are of the opinion that said sections 38, 55, and 112 should not be applied to such purchasers. We do not believe that the phrase "innocent purchaser should be applied to such a purchaser. He cannot be regarded as an "innocent purchaser" because of the facts contained in the record of the first original certificate. The rule should not be applied to the purchaser of a parcel of land the vendor of which is not the owner of the original certificate, or his successors. He, in nonsense, can be an "innocent purchaser" of the portion of the land included in another earlier original certificate. The rule of notice of what the record contains precludes the idea of innocence. By reason of the prior registry there cannot be an innocent purchaser of land included in a prior original certificate and in a name other than that of the vendor, or his successors. In order to minimize the difficulties we think this is the safe rule to establish. We believe the phrase "innocent purchaser," used in said sections, should be limited only to cases where unregistered land has been wrongfully included in a certificate under the torrens system. When land is once brought under the torrens system, the record of the original certificate and all subsequent transfers thereof is notice to all the world. That being the rule, could Teus even regarded as the holder in good fifth of that part of the land included in his certificate of the appellants? We think not. Suppose, for example, that Teus had never had his lot registered under the torrens system. Suppose he had sold his lot to the appellee and had included in his deed of transfer the very strip of land now in question. Could his vendee be regarded as an "innocent purchaser" of said strip? Would his vendee be an "innocent purchaser" of said strip? Certainly not. The record of the original certificate of the appellants precludes the possibility. Has the appellee gained any right by reason of the registration of the strip of land in the name of his vendor? Applying the rule of notice resulting from the record of the title of the appellants, the question must be answered in the negative. We are of the opinion that these rules are more in harmony with the purpose of Act No. 496 than the rule contended for by the appellee. We believe that the purchaser from the owner of the later certificate, and his successors, should be required to resort to his vendor for damages, in case of a mistake like the present, rather than to molest the holder of the first certificate who has been guilty of no negligence. The holder of the first original certificate and his successors should be permitted to rest secure in their title, against one who had acquired rights in conflict therewith and who had full and complete knowledge of their rights. The purchaser of land included in the second original certificate, by reason of the facts contained in the public record and the knowledge with which he is charged and by reason of his negligence, should suffer the loss, if any, resulting from such purchase, rather than he who has obtained the first certificate and who was innocent of any act of negligence. The foregoing decision does not solve, nor pretend to solve, all the difficulties resulting from double registration under the torrens system and the subsequent transfer of the land. Neither do we now attempt to decide the effect of the former registration in the ordinary registry upon the registration under the torrens system. We are inclined to the view, without deciding it, that the record under the torrens system, supersede all other registries. If that view is correct then it will be sufficient, in dealing with land registered and recorded alone. Once land is registered and recorded under the torrens system, that record alone can be examined for the purpose of ascertaining the real status of the title to the land. It would be seen to a just and equitable rule, when two persons have acquired equal rights in the same thing, to hold that the one who acquired it first and who has complied with all the requirements of the law should be protected. In view of our conclusions, above stated, the judgment of the lower court should be and is hereby revoked. The record is hereby returned to the court now having and exercising the jurisdiction heretofore exercised by the land court, with direction to make such orders and decrees in the premises as may correct the error heretofore made in including the land in the second original certificate issued in favor of the predecessor of the appellee, as well as in all other duplicate certificates issued. Without any findings as to costs, it is so ordered.

G.R. No. 170528 August 26, 2008 HEIRS OF JULIAN TIRO, petitioners, vs. PHILIPPINE ESTATES CORPORATION, respondent. This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the Decision 1dated 1 July 2005, rendered by the Court of Appeals in CA-G.R. CV No. 78582, which affirmed the Decision2 dated 16 April 2002 of the Regional Trial Court (RTC), Branch 54, Lapu-Lapu City, in Civil Case No. 4824-L dismissing petitioners complaint and declaring the respondent as the owner of the disputed property. Petitioners Guillerma Tiro, Dominga Tiro Nunez and Maximo Tiro filed before the RTC a Complaint for Quieting of Title against respondent Philippine Estates Corporation, a corporation duly organized and existing under the laws of the Philippines. The complaint was docketed as Civil Case No. 4824-L. Petitioners alleged that they are the children of the late Julian Tiro and the authorized representatives of the Heirs of the late Pedro Tiro. Both decedents were purportedly, during their lifetime, the lawful absolute and registered owners of the disputed land as evidenced by Original Certificate of Title (OCT) No. RO-1121.3 The disputed property is herein described as follows: A parcel of land (Lot 2914 of the Cadastral Survey of Opon, L.R.C. Record No. 1003) situated in the Barrio of Marigondon, Municipality of Opon, Province of Cebu, Island of Mactan x x x; containing an area of EIGHT THOUSAND ONE HUNDRED TWENTY (8,120) SQUARE METERS.4 Petitioners averred that they and their predecessors-in-interest had been in actual possession of the disputed land since time immemorial until they were prevented from entering the same by persons claiming to be the new owners sometime in 1995. After examining the records found in the Office of the Register of Deeds of LapuLapu City, they discovered that OCT No. RO-1121 had already been cancelled as early as 1969 and that the subject property, after several other transfers, was presently registered in the name of respondent under Transfer Certificate of Title (TCT) No. 35672.5 The records in the Office of the Register of Deeds showed each transfer involving the disputed land. Petitioners learned that OCT No. RO-1121, registered in the names of Julian and Pedro Tiro, was cancelled on 10 September 1969. In its place, TCT No. 2848 was issued in favor of Spouses Julio Baba and Olimpia Mesa. The registration of the disputed property in favor of the Spouses Baba was supported by two documents: (1) an Extrajudicial Declaration of Heir and Confirmation of Sale 6 dated 20 August 1969, executed by Maxima Ochea (Ochea), claiming to be the only surviving heir of Julian and Pedro Tiro, wherein she confirmed and ratified an alleged sale of the subject land made before World War II by Julian and Pedro Tiro in favor of Spouses Bibiano Amores and Isabel Digno; and (2) another document entitled "Deed of Confirmation, 7" also dated 20 August 1969, executed by the Spouses Amores, wherein they verified that they subsequently transferred the disputed property to the Spouses Baba sometime in 1947. On 20 June 1979, TCT No. 2848 was cancelled to give way to the issuance of TCT No. 9415 in the name of Spouses Ronaldo Velayo and Leonor Manuel, after the Spouses Baba sold the disputed property to them.8 Subsequently, the same property was sold by the Spouses Velayo to Pacific Rehouse Corporation, as a consequence of which TCT No. 9415 was cancelled and TCT No. 30186 was issued in the name of the latter on 16 February 1995.9 Finally, on 25 October 1996, following the sale of the disputed land to respondent, TCT No. 30186 was cancelled and TCT No. 35672 was issued in its name.10 Petitioners averred that Ochea, who executed the document "Extrajudicial Declaration of Heir and Confirmation of Sale," which resulted in the cancellation of OCT No. RO-1121 in the name of Julian and Pedro Tiro, was not in any way related to Julian and Pedro Tir o. It was the petitioners contention that since Ochea was not an heir of the original registered owners, she had no right to cause the transfer of the disputed property and, thus, her transfer and all subsequent transfers of said property, including that made to respondent, were invalid.11 Instead of presenting documents to evidence their relationship to the decedents Julian and Pedro Tiro, petitioners offered the testimonies of petitioners Maximo Tiro12 and his son-in-law Joveniano Diasana.13 Finally, the petitioners prayed that all the transactions emanating from the "Extrajudicial Declaration of Heirs and Confirmation of Sale," executed by Maxima Ochea, be declared void, including the transfer made in favor of the respondent; that the title which was issued in the name of respondent be cancelled; and that the property be restored and registered in the name of the petitioners.14 In its Answer dated 10 February 1998, respondent claimed that its predecessor-in-interest Pacific Rehouse Corporation acquired the subject land from the Spouses Velayo, the registered owners of the property who were also in possession of the same at the time of the sale. There was nothing in the title or any circumstances during the sale that would indicate any defect in the Spouses Velayos title to the property. Respondent pointed out that 27 years had elapsed since the cancellation of OCT No. RO-1121 before petitioners asserted their rights over the disputed land. Moreover, petitioners predecessors -in-interest Julian and Pedro Tiro did not question the cancellation of their title to the property during their lifetimes. Hence, respondent argued that petitioners action for quieting of title was barred by laches and prescription.15 To support its allegations, respondent presented TCT No. 2914 in the name of the Spouses Velayo as proof that they were the registered owners of the disputed property at the time they sold it to Pacific Rehouse Corporation.16 Additionally, respondent presented a Decision17 dated 28 June 1994 in Civil Case No. R-1202, entitled Spouses Velayo v. Spouses Tiro, rendered by the Municipal Trial Court (MTC) of Lapu-Lapu City to further prove that the Spouses Velayo were also in possession of the disputed property at the time of its sale to Pacific Rehouse Corporation. Civil Case No. R-1202 was a case for Forcible Entry with Writ of Preliminary Mandatory Injunction, and in its Decision dated 28 June 1994, the MTC declared the Spouses Velayo the rightful possessors of the subject property and ordered petitioner Maximo Tiro and his co-defendant spouse to vacate the portion of the property which they forcibly entered on 7 May 1994. Respondent likewise presented the Deed of

Sale18 dated 4 October 1994 executed by the Spouses Velayo in favor of Pacific Rehouse Corporation; the Deed of Transfer19 dated 23 October 1996 executed by Pacific Rehouse Corporation in favor of respondent; and various tax declarations issued in the names of the Spouses Baba, Spouses Velayo, Pacific Rehouse Corporation, and respondent during the years that each of them claimed ownership over the disputed property.20 On 16 April 2002, the RTC issued a Decision21 in Civil Case No. 4824-L dismissing petitioners Complaint. The trial court noted that petitioners claims of filiation to Julian and Pedro Tiro were not supported by documents. The testimonies of petitioners witnesses were also inconsistent as to the location of the disputed land, as well as the number of Pedro Tiros children. The RTC stressed that even assuming that petitioners were heirs of the late Julian and Pedro Tiro, and Maxima Ochea was in no way related to them, petitioners claims had already prescribed, considering that the Complaint was filed more than ten years since the registration of the disputed property in the name of the Spouses Baba in 1969. Petitioners allegation that they were in continuous possession of the subject property until 1995 was also belied by the Decision dated 28 June 1994 of the MTC in Civil Case No. R-1202, ordering petitioners to vacate the disputed property, which they forcibly entered, and to restore possession to the Spouses Velayo. Lastly, the RTC ruled that respondent was an innocent purchaser for value who relied on the correctness of the certificate of title in the name of the vendor. Petitioners filed a Notice of Appeal on 2 May 2002 questioning the 16 April 2002 Decision of the RTC. The petitioners filed with the Court of Appeals an appeal docketed as CA-G.R. CV No. 78582, questioning the decision rendered by the trial court. However, instead of filing an Appellants Brief as required by the Court of Appeals, petitioners filed before the Court of Appeals in CA-G.R. CV No. 78582 a Motion to Grant New Trial Pursuant to Section 1, Rule 53,22 on 8 January 2004. They attached as annexes to their motion the following documents to prove that Julian Tiro was their father: (1) Certificates of Baptism of Pastor Tiro and Dominga Tiro;23 (2) marriage contract of Dominga Tiro;24 (3) Certificate of Marriage of Guillerma Tiro;25 (4) Certification of Marriage of Pastor Tiro;26 and (5) Certificate of Baptism of Victoria Tiro.27In a Resolution28 dated 5 August 2004, the appellate court denied the motion. In its Decision dated 1 July 2005, the Court of Appeals likewise denied the petitioners appeal in CA-G.R. CV No. 78582 and affirmed the RTC Decision dated 16 April 2002 in Civil Case No. 4824-L. The appellate court found that petitioners failed to prove that they were the heirs of Julian and Pedro Tiro. It also took into account the fact that during their lifetime, Julian and Pedro Tiro never questioned the transactions which affected their land. The Court of Appeals gave significant weight to the respondents statements that it had acquired the subject property from the registered owners, supported by the registered titles that were presented in court. Thus, the Court of Appeals held that even assuming that the first few transfers turned out to be fraudulent, the transfer to respondent, a purchaser in good faith, may be the root of a valid title.29 Petitioners filed a Motion for Reconsideration dated 25 July 2005,30 which the Court of Appeals denied in a Resolution dated 28 October 2005.31 Hence, the present Petition, in which petitioners make the following assignment of errors: I THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT FINDING THAT THE ACT OF THE REGISTER (sic) OF DEEDS OF REGISTERING A CLEARLY VOID AND UNREGISTRABLE DOCUMENT CONFERS NO VALID TITLE ON THE PRESENTOR AND HIS SUCCESSORS-IN-INTEREST. II THE COURT OF APPEALS GRAVELY ERRED IN NOT APPLYING THE DOCTRINE IN SPOUSES SANTIAGO, ET AL. VS. COURT OF APPEALS, ET AL., G.R. [NO.] 103959, AUGUST 21, 1997 WHEREBY IT IS HELD [THAT] "THE TORRENS SYSTEM DOES NOT CREATE OR VEST TITLE. IT ONLY CONFIRMS AND RECORDS TITLE ALREADY EXISTING AND VESTED. IT DOES NOT PROTECT A USURPER FROM THE TRUE OWNER NOR CAN IT BE A SHIELD IN THE COMMISSION OF FRAUD. WHERE ONE DOES NOT HAVE ANY RIGHTFUL CLAIM OVER A REAL PROPERTY, THE TORRENS SYSTEM OF REGISTRATION CONFIRM[S] OR RECORD[S] NOTHING.32 This Petition lacks merit. Petitioners main contention is, since Ochea was not even related to either Julian or Pedro Tiro, the "Declaration of Heir and Confirmation of Sale" which she executed could not have resulted in the cancellation of OCT No. RO-1121 in the names of Julian and Pedro Tiro. They further argue that since the initial transfer of the disputed land was fraudulent, therefore, all the subsequent transfers, including that made to respondent, were all invalid. Petitioners arguments are unfounded. Insofar as a person who has fraudulently obtained property is concerned, the consequently fraudulent registration of the property in the name of such person would not be sufficient to vest in him or her title to the property. Certificates of title merely confirm or record title already existing and vested. The indefeasibility of the torrens title should not be used as a means to perpetrate fraud against the rightful owner of real property. Good faith must concur with registration because, otherwise, registration would be an exercise in futility.33 However, where good faith is established, as in the case of an innocent purchaser for value, a forged document may become the root of a valid title. 34 A person is considered in law as an innocent purchaser for value when he buys the property of another, without notice that some other person has a right or an interest in such property, and pays a full price for the same at the time of such purchase, or before he has notice of the claims or interest of some other person in the property. A person dealing with registered land may safely rely on the correctness of the certificate of title of the vendor/transferor, and the law will in no way oblige him to go behind the certificate to determine the condition of the property. The courts cannot disregard the rights of innocent third persons, for that would impair or erode public confidence in the torrens system of land registration. Thus, a title procured by fraud or

misrepresentation can still be the source of a completely legal and valid title if the same is in the hands of an innocent purchaser for value.35 In the present case, respondent was clearly an innocent purchaser for value. It purchased the disputed property from Pacific Rehouse Corporation, along with other parcels of land for a valuable consideration, i.e., shares of common stock of respondent with a value of P148,100,400.00. Pacific Rehouse Corporation, in turn, purchased the property from Spouses Velayo, also for valuable consideration in the amount of P1,461,600.00. The certificates of title of Pacific Rehouse Corporation and the Spouses Velayo were clean and appeared valid on their face, and there was nothing therein which should have put the respondent on its guard of some defect in the previous registered owners title to the disputed property. In addition to their certificate of title, the Spouses Velayo even presented to Pacific Rehouse Corporation a copy of the MTC Decision dated 28 June 1994 in Civil Case No. R-1202 ordering petitioners to vacate the disputed property, which they forcibly entered, and to restore possession thereof to the Spouses Velayo. The said Decision supported the Spouses Velayos claim of title to the disputed property. In Spouses Chu, Sr. v. Benelda Estate Development Corporation ,36 this Court pronounced that it is crucial that a complaint for annulment of title must allege that the purchaser was aware of the defect in the title, so that the cause of action against him or her will be sufficient. Failure to do so, as in the case at bar, is fatal for the reason that the court cannot render a valid judgment against the purchaser who is presumed to be in good faith in acquiring said property. Failure to prove, much less impute, bad faith to said purchaser who has acquired a title in his or her favor would make it impossible for the court to render a valid judgment thereon, due to the indefeasibility and conclusiveness of his or her title. In this case, petitioners directed all allegations of bad faith solely at Ochea. The property in question had already been the subject of five succeeding transfers to persons who were not accused of having purchased the same in bad faith. Petitioners attempt, therefore, to have respondents certificate of title to the disputed property annulled, must fail. In Veloso v. Court of Appeals,37 this Court enunciated that a title issued to an innocent purchaser and for value cannot be revoked on the basis that the deed of sale was falsified, if he had no knowledge of the fraud committed. The Court also provided the person prejudiced with the following recourse: Even granting for the sake of argument, that the petitioners signature was falsified and consequentl y, the power of attorney and the deed of sale were null and void, such fact would not revoke the title subsequently issued in favor of private respondent Aglaloma. In Tenio-Obsequio v. Court of Appeals, it was held, viz: "The right of an innocent purchaser for value must be respected and protected, even if the seller obtained his title through fraud. The remedy of the person prejudiced is to bring an action for damages against those who caused or employed the fraud, and if the latter are insolvent, an action against the Treasurer of the Philippines may be filed for recovery of damages against the Assurance Fund." (Emphasis supplied.) Petitioners cite Sps. Santiago v. Court of Appeals.38 In Santiago, the plaintiff and the defendants were the parties to the void contract of sale of the disputed property. The contract was considered simulated for lack of consideration and given the fact that defendants failed to take possession of the subject property. For this reason, the Court did not hesitate to cancel the certificates of title in the defendants names, since they were found not to be the rightful owners of the property. More importantly, the defendants were not innocent purchasers for value, since they were privy to the nullity of the contract of sale covering the property. Santiago is clearly inapplicable to the present case. Respondent herein who paid adequate consideration for the disputed land, took possession of the same, and is already the fifth transferee following the allegedly fraudulent initial transfer of the land, cannot be placed in the same position as a vendor who was a party to a simulated sale of a real property. IN VIEW OF THE FOREGOING, the instant Petition is DENIED. The assailed Decision of the Court of Appeals in CAG.R. CV No. 78582, promulgated on 1 July 2005, is AFFIRMED. Costs against petitioners. SO ORDERED.

G.R. No. 164687 February 12, 2009 SM PRIME HOLDINGS, INC., Petitioner, vs. ANGELA V. MADAYAG, Respondent. This is a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) dated March 19, 2004 and Resolution dated July 15, 2004, which set aside the lower courts order to suspend the proceedings on respondents application for land registration. On July 12, 2001, respondent Angela V. Madayag filed with the Regional Trial Court (RTC) of Urdaneta, Pangasinan an application for registration of a parcel of land with an area of 1,492 square meters located in Barangay Anonas, Urdaneta City, Pangasinan.2 Attached to the application was a tracing cloth of Survey Plan Psu-01-008438, approved by the Land Management Services (LMS) of the Department of Environment and Natural Resources (DENR), Region 1, San Fernando City. On August 20, 2001, petitioner SM Prime Holdings, Inc., through counsel, wrote the Chief, Regional Survey Division, DENR, Region I, demanding the cancellation of the respondents survey plan because the lot encroached on the properties it recently purchased from several lot owners and that, despite being the new owner of the adjoining lots, it was not notified of the survey conducted on June 8, 2001.3 Petitioner then manifested its opposition t o the respondents application for registration. The Republic of the Philippines, through the Office of the Solicitor General, and the heirs of Romulo Visperas also filed their respective oppositions. On February 6, 2002, petitioner filed its formal opposition. Petitioner alleged that it had recently bought seven parcels of land in Barangay Anonas, Urdaneta, delineated as Lots B, C, D, E, G, H and I in ConsolidationSubdivision Plan No. (LRC) Pcs-21329, approved by the Land Registration Commission on August 26, 1976, and previously covered by Survey Plan No. Psu-236090 approved by the Bureau of Lands on December 29, 1970. These parcels of land are covered by separate certificates of title, some of which are already in the name of the petitioner while the others are still in the name of the previous owners. On February 20, 2002, the RTC declared a general default, except as to the petitioner, the Republic, and the heirs of Romulo Visperas. Thereafter, respondent commenced the presentation of evidence. Meanwhile, acting on petitioners request for the cancellation of the respondents survey plan, DENR Assistant Regional Executive Director for Legal Services and Public Affairs, Allan V. Barcena, advised the petitioner to file a petition for cancellation in due form so that the DENR could properly act on the same.4 Accordingly, petitioner formally filed with the DENR a petition 5 for cancellation of the survey plan sometime in March 2002, alleging the following grounds: I. THERE IS NO SUCH THING AS ALIENABLE OR DISPOSABLE PROPERTY WHICH IS THE SUBJECT LOT IN THIS CASE II. NO NOTICE WAS MADE UPON PETITIONER (AS ADJOINING LANDOWNER AND WHO BEARS INTEREST OVER THE SUBJECT LOT) MUCH LESS THE OWNERS OF ADJOINING LANDS. III. THE CIRCUMSTANCES EVIDENTLY SHOW THAT BAD FAITH AND/OR MALICE ATTENDED THE APPROVAL OF (PLAN WITH PSU NO. 01-008438).6 On July 17, 2002, petitioner filed an Urgent Motion to Suspend Proceedings 7 in the land registration case, alleging that the court should await the DENR resolution of the petition for the cancellation of the survey plan "as the administrative case is prejudicial to the determination" of the land registration case. On October 8, 2002, the RTC issued an Order granting the motion, thus: WHEREFORE, PREMISES CONSIDERED, the Court hereby GRANTS the instant motion and suspends the proceedings herein. In the meantime, and until receipt by this Court of a copy of the resolution of the petition for cancellation by the DENR, the instant case is hereby ARCHIVED. SO ORDERED.8 Emphasizing that a survey plan is one of the mandatory requirements in land registration proceedings, the RTC agreed with the petitioner that the cancellation of the survey plan would be prejudicial to the petition for land registration.9 On February 13, 2003, the RTC denied the respondents motion for reconsideration of its order. 10 Respondent thereafter filed a petition for certiorari with the CA assailing the order suspending the proceedings. On March 19, 2004, finding that the RTC committed grave abuse of discretion in suspending the proceedings, the CA granted the petition for certiorari, thus: WHEREFORE, premises considered, the instant petition is hereby GRANTED. The challenged Orders dated October 8, 2002 and February 13, 2003 of the respondent Court are declared NULL and VOID. The Court a quo is directed to continue the proceedings until its final determination. No pronouncement as to costs. SO ORDERED.11 The CA ratiocinated that the survey plan which was duly approved by the DENR should be accorded the presumption of regularity, and that the RTC has the power to hear and determine all questions arising from an application for registration.12 On July 15, 2004, the CA issued a Resolution13 denying the petitioners motion for reconsideration. Petitioner was, thus, compelled to file this petition for review, ascribing the following errors to the CA: I. THE COURT OF APPEALS COMMITTED MANIFEST ERROR IN NOT FINDING THAT THE SUSPENSION OF THE PROCEEDINGS IN THE LAND REGISTRATION CASE IS LEGAL AND PROPER PENDING THE DETERMINATION AND

RESOLUTION OF THE ADMINISTRATIVE CASE BEFORE THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES-REGION 1. II. THE COURT OF APPEALS COMMITTED MANIFEST ERROR IN FAILING TO FIND THAT THE ASSAILED ORDERS OF THE LOWER COURT HAVE PROPER AND SUFFICIENT BASES IN FACT AND IN LAW. III. THE COURT OF APPEALS COMMITTED MANIFEST ERROR IN HOLDING THAT THE LOWER COURT HAS ACTED WITH GRAVE ABUSE OF DISCRETION IN SUSPENDING THE PROCEEDINGS AND ARCHIVING THE CASE. IV. THE COURT OF APPEALS COMMITTED MANIFEST ERROR IN FAILING TO FIND THAT THE FILING OF THE PETITION FOR CERTIORARI, UNDER RULE 65 OF THE REVISED RULES OF CIVIL PROCEDURE, IS NOT THE ONLY PLAIN, SPEEDY AND ADEQUATE REMEDY IN THE ORDINARY COURSE OF LAW ON THE PART OF HEREIN RESPONDENT. 14 The petition has no merit. Petitioner contends that, since the respondents cause of action in the land registration case depends heavily on the survey plan, it was only prudent for the RTC to suspend the proceedings therein pending the resolution of the petition for cancellation of the survey plan by the DENR.15 It, therefore, insists that recourse to a petition for certiorari was not proper considering that respondent was not arbitrarily deprived of her right to prosecute her application for registration.16 Undeniably, the power to stay proceedings is an incident to the power inherent in every court to control the disposition of the cases in its dockets, with economy of time and effort for the court, counsel and litigants. But courts should be mindful of the right of every party to a speedy disposition of his case and, thus, should not be too eager to suspend proceedings of the cases before them. Hence, every order suspending proceedings must be guided by the following precepts: it shall be done in order to avoid multiplicity of suits and prevent vexatious litigations, conflicting judgments, confusion between litigants and courts, 17 or when the rights of parties to the second action cannot be properly determined until the questions raised in the first action are settled.18 Otherwise, the suspension will be regarded as an arbitrary exercise of the courts discretion and can be corrected only by a petition for certiorari. None of the circumstances that would justify the stay of proceedings is present. In fact, to await the resolution of the petition for cancellation would only delay the resolution of the land registration case and undermine the purpose of land registration. The fundamental purpose of the Land Registration Law (Presidential Decree No. 1529) is to finally settle title to real property in order to preempt any question on the legality of the title except claims that were noted on the certificate itself at the time of registration or those that arose subsequent thereto.1avvphi1 Consequently, once the title is registered under the said law, owners can rest secure on their ownership and possession.19 Glaringly, the petition for cancellation raises practically the very same issues that the herein petitioner raised in its opposition to the respondents application for registration. Principally, it alleges that the survey plan should be cancelled because it includes portions of the seven properties that it purchased from several landowners, which properties are already covered by existing certificates of title. Petitioner posits that it is the DENR that has the sole authority to decide the validity of the survey plan that was approved by the LMS.20 It cites Section 4(15), Chapter 1, Title XIV, Administrative Code of 1987 which provides that the DENR shall (15) Exercise (of) exclusive jurisdiction on the management and disposition of all lands of the public domain and serve as the sole agency responsible for classification, sub-classification, surveying and titling of lands in consultation with appropriate agencies. However, respondent argues that the land registration court is clothed with adequate authority to resolve the conflicting claims of the parties, and that even if the DENR cancels her survey plan, the land registration court is not by duty bound to dismiss the application for registration based solely on the cancellation of the survey plan.21lawphil.net Without delving into the jurisdiction of the DENR to resolve the petition for cancellation, we hold that, as an incident to its authority to settle all questions over the title of the subject property, the land registration court may resolve the underlying issue of whether the subject property overlaps the petitioners properties without necessarily having to declare the survey plan as void. It is well to note at this point that, in its bid to avoid multiplicity of suits and to promote the expeditious resolution of cases, Presidential Decree (P.D.) No. 1529 eliminated the distinction between the general jurisdiction vested in the RTC and the latters limited jurisdiction when acting merely as a land registration court. Land registration courts, as such, can now hear and decide even controversial and contentious cases, as well as those involving substantial issues.22 When the law confers jurisdiction upon a court, the latter is deemed to have all the necessary powers to exercise such jurisdiction to make it effective.23 It may, therefore, hear and determine all questions that arise from a petition for registration. In view of the nature of a Torrens title, a land registration court has the duty to determine whether the issuance of a new certificate of title will alter a valid and existing certificate of title.24 An application for registration of an already titled land constitutes a collateral attack on the existing title, 25 which is not allowed by law.26 But the RTC need not wait for the decision of the DENR in the petition to cancel the survey plan in order to determine whether the subject property is already titled or forms part of already titled property. The court may now verify this allegation based on the respondents survey plan vis--vis the certificates of title of the petitioner and its predecessors-in-interest. After all, a survey plan precisely serves to establish the true identity of the land to ensure that it does not overlap a parcel of land or a portion thereof already covered by a previous land registration, and to forestall the possibility that it will be overlapped by a subsequent registration of any adjoining land.27 Should the court find it difficult to do so, the court may require the filing of additional papers to aid in its determination of the propriety of the application, based on Section 21 of P.D. No. 1529:

SEC. 21. Requirement of additional facts and papers; ocular inspection. The court may require facts to be stated in the application in addition to those prescribed by this Decree not inconsistent therewith and may require the filing of any additional papers. The court may also directly require the DENR and the Land Registration Authority to submit a report on whether the subject property has already been registered and covered by certificates of title, like what the court did in Carvajal v. Court of Appeals.28 In that case, we commended such move by the land registration court for being "in accordance with the purposes of the Land Registration Law." 29 WHEREFORE, premises considered, the petition is DENIED. The Court of Appeals Decision dated March 19, 2004 and Resolution dated July 15, 2004 are AFFIRMED. The Regional Trial Court of Urdaneta, Pangasinan is DIRECTED to continue with the proceedings in L.R.C. Case No. U-1134 and to resolve the same with dispatch. SO ORDERED.

G.R. No. 83383 May 6, 1991 SOLID STATE MULTI-PRODUCTS CORPORATION, petitioner, vs. THE COURT OF APPEALS (Former Sixth Division) and THE INTESTATE ESTATE OF ANTENOR S. VIRATA and the DEVELOPMENT BANK OF THE PHILIPPINES, respondents. Antonio M. Chavez for petitioner.; Rodolfo M. Dela Rosa for respondent Intestate Estate of Antenor S. Virata. This is a petition for review on certiorari of the decision of the Court of Appeals which affirmed the decision of the trial court dismissing the complaint filed by petitioner for quieting of title and declaring Antenor Virata as the true and lawful owner of the disputed property. The antecedent facts are as follows: On September 28, 1982, petitioner, a domestic corporation, filed an action for quieting of title against the respondent estate of Virata alleging that it is the registered owner of a parcel of land located at Imus, Cavite, with an area of 48,182 sq. meters, covered by Certificate of Title No. T-80889 of the Register of Deeds of Cavite, which was issued on February 24, 1976; that Virata, during his lifetime thru the use of fraud, caused the issuance of Certificate of Title No. T-11520 RT 1660 on September 1, 1959 thru an administrative reconstitution of a nonexistent original title covering the same parcel of land; that by reason of the said reconstitution and subsequent issuance of TCT No. T-11520 RT 1660, there now exists a cloud on the title of petitioner. As gathered by the respondent appellate court and trial court, the evidence for the petitioner consists of the following: Pursuant to the provisions of Act No. 32, as amended, Julian Pearanda submitted with the Bureau of Lands, thru its District Land Office at Rosario, Cavite an application dated November 22, 1968, in a verified Indorsement dated November 25, 1968, to purchase a friar land which was subscribed and sworn to before Manuel Cupino, Acting District Land Officer (Exh. "D"). The application covers Lot No. 7449 of the Imus Friar Lands Estate, situated at Barrio Molino, Bacoor, Cavite, containing an area of 4 hectares, 81 ares and 82 centares. Said application was accompanied by a "SALAYSAY" (Exhibit "A") signed and sworn to by one Mabini Legaspi before said District Land Officer Cupino, purporting to transfer to, and to waive in favor of, Julian Pearanda, all the rights of executor to Lot No. 7449. Following the routine in cases of this nature, District Land Officer Cupino referred to Land Investigator Alberto Buhain for investigation and in a verified Indorsement dated November 25, 1968, said investigator made a Report (Exh. "B") on the result of his investigation, to District Land Officer Cupino, District Land Office No. III-8 Bureau of Lands, Rosario, Cavite, certifying that applicant Julian Pearanda is the actual occupant of Lot No. 7449, has introduced improvements consisting of upland rice and other seasonal crops; that Pearanda's occupation of the land is derived through a voluntary assignment of right of the former occupant, Mabini Legaspi, and that the same is free from claims and conflicts and that the said applicant has established his rights over the subject land, in view of which, said investigator recommended that said lot be awarded to applicant Julian Pearanda according to law. Thereafter, the Report having been submitted to Cupino, the latter directed investigator Buhain to prepare an Information Sheet (Exh. "G" up to "G-3") and Cupino made the Appraisal Report (Exh. "E-2"). The above requirements having been accomplished, District Land Officer Cupino forwarded Pearanda's application to the Director of Lands, thru the Chief, Land Management Division, recommending disposition of Lot No. 7449 be made in accordance with the findings of his office, to Julian Pearanda, pursuant to the provisions of C.A. of No. 32, as amended. By second Indorsement dated December 16, 1968, Higinio P. Sunico, Chief, Land Management Division, acting for and in behalf of the Director of Lands, forwarded to the Secretary of Agriculture and Natural Resources, the application of Julian Pearanda, recommending that Lot No. 7449 be sold to said applicant without public auction for a sum of P1,198.00 (Exh. "I") and by a 3rd Indorsement dated December 16, 1969, the application of Julian Pearanda was returned by the Secretary of Agriculture and Natural Resources, to the Director of Lands, Manila, approving that sale without auction, to Julian Pearanda, of lot No. 7449. Pursuant to this approval, the Director of Lands authorized the District Land Officer, Rosario, Cavite, to sell without auction to Julian Pearanda, and directing that the sales contract should be executed soonest (Exh- "I"). The Director of Lands and Julian Pearanda executed, therefore, Sales Contract No. V-447 (Exh. "K"), on February 28, 1969, for a consideration of P1,198.00, to be paid in ten (10) monthly installments, the first installment of P290.00 having been paid upon execution of the sales contract and the payment of the P1,198.00 was fully paid on August 6, 1969 (Exh. "O"). The contract price of the land having been paid by Pearanda , Undersecretary of Agriculture and Natural Resources Isoceles Pascual, on August 13, 1969, issued the final deed of conveyance of lot No. 7449 (Exh. "8") in favor of Julian Pearanda and the said deed of conveyance contains the physical and technical description of the lot in question (See Exh. "S-l"). xxx xxx xxx On the basis of said Deed of Conveyance No. 10431, the Register of Deeds of Cavite issued on November 14, 1969 in favor of Julian Pearanda TCT No. T-39631 (Exh. "Z-6") which on its face shows it to have come from a direct transfer from OCT no. 1002, and on February 17, 1976, the plaintiff, by way of a Deed of Absolute Sale (Exh. "Z") bought said Lot No. 7449 as a consequence of which, TCT No. T-39631 was cancelled and new TCT No. T-80889 was issued on February 24, 1976 to the plaintiff, Solid State Multi Products Corporation.

Plaintiff Solid State Multi-Products Corporation enrolled Lot No. 7449 with the issuance of Tax Declaration No. 20893 which was superseded by Tax Declaration No. 10973 and continued to religiously pay the realty taxes as covered by receipts of tax payments (Exh. for 1977 and Exh. "7-19" for 1984) and the subject property is in its actual possession since its acquisition from Pearanda up to the present. (pp. 109-112, Rollo (Emphasis Ours) On the other hand, respondent Virata denied the allegations in the complaint and presented evidence to prove his claim over the land. The appellate court and trial court made the following findings: . . . on March 20, 1943, the Director of Lands, Mr. Jose F. Dans, gave authority to sell at public auction Lot No. 7449 of the Imus Estate, containing an area of 4.8182 hectares at the price of not less than its appraised value of P290.00 (Exh. X-33). Accordingly on April 20, 1943, the Bureau of Friar Lands Agent Severo Rivera issued a Notice fixing the public auction of Lot No. 7449, among others, on May 5, 1943 at 10:00 a.m. (Exh. 1). On said date, Mabini Legaspi (appellee Virata's predecessor-in-interest) submitted a winning bid of P290.00 and paid P29.00 (10% of the purchase price) and even issued Bureau of Lands Official Receipt No. 77735 dated May 5, 1943 (Exh. 7). The subsequent installments were paid on January 14, 1944, April 24, 1944, August 17, 1944, and September 20, 1944 in the amounts of P29.00, P29.00, 87.00 and P116.00, respectively. The payments were evidenced by Official Receipts Nos. 78396, 783392, 784704 and 78466 (Exhs. 7-A, 7-B, 7-C and V) On December 12, 1944, the Bureau of Lands, through Mr. Vicente Tordesillas, sent a letter to the Register of Deeds at Imus, Cavite, requesting the issuance of the corresponding certificates of title to eight persons, among whom was Mabini Legaspi, specifying with respect to him Lot No. 7449 with an area of 4.8182 located at Bacoor, Cavite Exh. 2). Accordingly, the Register of Deeds of Cavite issued TCT No. A2188 to Mabini Legaspi who held ownership of the property up to December 6, 1957 when he executed a Deed of Sale transferring it to Antenor S. Virata (Exh. 6). The deed was registered with the Registry of Deeds on December 10, 1957 . . . . On the same day, December 10, 1957, the Register of Deeds issued TCT No. 11520 (Exh. 12) to Antenor Virata . . . However, on June 7, 1959, the Provincial Capitol building of Cavite which housed the Registry of Deeds was burned, destroying land records and titles in d registry among which were the records relating to Lot No. 7449. On September 1, 1959, the Registry of Deeds administratively reconstituted the original of TCT No. T11520 based on owner's duplicate certificate (Exh. 12) and renumbered the same as TCT No. (T-11520) RT-1660. xxx xxx xxx The sentence of TCT No. 80889 issued in the name of appellant on February 24, 1976 came to the knowledge of Antenor Virata in August 1978 when he received a subpoena from the National Bureau of Investigation (NBI) in connection with its investigation of the conflicting land titles on Lot No. 7449. Virata presented Mabini Legaspi as his witness. NBI Agent Manuel C. Dionisio took the sworn testimony of Mabini Legaspi on August 27, 1978 (Exh. 10) and submitted a written report (Exhs. 9 to 9-H) of his investigation on October 27, 1978. Mabini Legaspi in her sworn testimony (Exh. 10) declared that she acquired Lot 7449 during the Japanese occupation and in support of her acquisition, she presented to NBI agent Dionisio the carbon or duplicate original of the notice of public auction and the letters dated December 12, 1944 of Vicente Tordesillas of the Bureau of Lands to the Register of Deeds requesting the issuance of a certificate of title in favor of Mabini Legaspi, which documents were substituted on the same occasion with xerox copies (Exh. 1 and 2) also marked as Exhibits 10-C and 10-D, respectively, after a comparison with the duplicate originals. Legaspi also presented the originals of the receipts of payment she made to the Bureau of Lands, which were substituted with xerox copies (Exhs. 7, 7-A, 7-B and 7-C, also marked as Exhibit 10-E, 10-F 10-G and 10-H) after comparison with the original. She (Mabini) also testified on the sale of the lot in favor of Antenor Virata on December 6, 1957, presenting as proof thereof, the duplicate or carbon original of the Absolute Deed of Sale of Agricultural Land, which was likewise, substituted with xerox copies (Exhs. 6 to 6-F, inclusive, also marked Exh. 11). Mabini Legaspi testified that the originals of Exhibits 1 and 2 got lost. She said she placed the documents on the table in her house after returning from the NBI investigation, thinking "all the while that those documents will be useless because I had my property sold." (Tsn., p. 17, December 19, 1984). She denied having sold the land to Julian Pearanda, nor having waived her right over the land in his favor (tsn., p. 12, March 18, 1985). (pp. 113-116, Rollo). On June 15, 1985, the trial court rendered its decision, the dispositive portion of which reads: WHEREFORE, by preponderance of evidence, judgment is hereby rendered for defendant Virata and against the plaintiff, to wit: a. Dismissing the complaint which states no cause of action; b. Recognizing that defendant Virata is the true and lawful owner of the land covered by Transfer Certificate of Title No. (T-11520) RT 1660 of the Register of Deeds of the Province of Cavite and holding that the same is valid; c. Declaring that Transfer Certificate of Title No. T-80889 in the name of plaintiff, the Solid State Multi Products Corporation is null and void and of no force and effect and is, therefore, ordered cancelled; d. Sentencing the plaintiff to pay the costs of the proceeding. SO ORDERED. (p. 70, Rollo). Not satisfied with the decision of the trial court, the petitioner appealed to the Court of Appeals. On July 13, 1987, the respondent appellate court rendered its decision affirming the decision of the trial court. Hence, this petition was filed with the petitioner assigning the following errors:

THE RESPONDENT COURT GROSSLY ERRED WHEN IT IGNORED THE BASIC CONSIDERATION THAT THE CONTESTED PROPERTY CAME FROM THE FRIAR LANDS ESTATE THE DISPOSITION OF WHICH IS GOVERNED BY SPECIAL LAWS SPECIFYING THE REQUIREMENTS FOR ITS ACQUISITION FROM THE GOVERNMENT THROUGH SALE, WHICH LAW AND SPECIAL REQUIREMENTS SHOULD SERVE AS THE MEASURE AGAINST WHICH THE EVIDENCE OF THE PARTIES TO THIS CASE SHOULD BE WEIGHED, SUCH GROSS ERROR LEADING THE APPELLATE COURT TO (A) ERRONEOUSLY INFER THE EXISTENCE AND/OR DUE ISSUANCE OF THE SUPPOSED TCT NO. A-2188 (IN THE NAME OF PRIVATE RESPONDENTS PREDECESSOR-IN INTEREST), FROM DOCUMENTS THAT CAME AFTER WERE BASED ON SUCH TCT NO. A-2188, CLEARLY BEGGING THE ISSUE WHICH IS PRECISELY WHETHER OR NOT THE TRANSFER CERTIFICATE OF TITLE WAS IN FACT ISSUED IN COMPLIANCE WITH THE FRIAR LANDS ACT AND CA-32 TO COVER THE PROPERTY IN QUESTION; (B) ERRONEOUSLY BASE ITS DECISION IN FAVOR OF PRIVATE RESPONDENT ON TCTs ISSUED BY THE REGISTER OF DEEDS INSPITE OF THE FACT THAT IT IS THE BUREAU OF LANDS UNDER THE DIRECTION OF THE SECRETARY OF AGRICULTURE AND COMMERCE (NATURAL RESOURCES) WHICH DISPOSES FRIAR LANDS AND NOT THE REGISTER OF DEEDS WHOSE RECORDS CAN BE NO BETTER THAN THE RIGHT IT HAS REGISTERED; (C) ERRONEOUSLY DISREGARD THE PATENT INADMISSIBILITY OF THE DOCUMENTARY EVIDENCE OFFERED BY THE PRIVATE RESPONDENT THE ORIGINALS OF WHICH WERE NEVER PRESENTED BEFORE THE TRIAL COURT; (D) ERRONEOUSLY IGNORE THE LACK OF PROBATIVE VALUE OF SUCH DOCUMENTARY EVIDENCE SUCH LACK OF PROBATIVE VALUE BEING PATENT ON THE FACE OF SUCH DOCUMENT; (E) ERRONEOUSLY IGNORE THE VERITY THAT THE DOCUMENTARY EVIDENCE COULD SUPPORT NO MORE THAN THE FACT THAT THE RESPONDENTS PREDECESSOR-IN-INTEREST HAD MERELY A QUESTIONABLE INCHOATE AND INCOMPLETE RIGHT TO ACQUIRE THE PROPERTY IN QUESTION, WHICH QUESTIONABLE INCHOATE AND IN FACT UNCOMPLETED RIGHT CANNOT PREVAIL OVER THE TITLE OF PETITIONER'S PREDECESSOR IN INTEREST WHO WAS THE ACTUAL POSSESSOR THAT APPLIED FOR THE PURCHASE OF THE LAND EVERY NEEDED STEP FOR THE PURCHASE HAVING BEEN PASSED UPON AND RECORDED BY THE BUREAU OF LANDS WHOSE RECORDS SHOW ONE AND ONLY TITLE ISSUED OVER THE LAND, THAT IS, THE TITLE OF THE PETITIONER'S PREDECESSOR-ININTEREST (pp. 20, 22, Rollo) We find the petition impressed with merit. Since the assigned errors were interrelated, it would be well for this Court to discuss them jointly. Petitioner does not question the factual findings made by the respondent appellate court and supported by the records (p. 22, Rollo). It does not however accept the legal conclusion made by the appellate court and trial court that the registered title of private respondent to the land should prevail over its own title. Petitioner contends that Act No. 1120, otherwise known as the Friar Lands Act provides the procedure for the sale and disposition of the friar lands to private persons; that pursuant thereto, the acquisition by petitioner's predecessor-in-interest Julian Pearanda of the disputed Lot 7449, which was formerly part of the friar lands estate, was in compliance with all legal requisites laid down in Act No. 1120, for the validity of the sale by the government in favor of Pearanda of such friar lands. It also argues that the sale of Lot No. 7449 to respondent's predecessor, Mabini Legaspi, and the issuance of a certificate of title in her favor was in violation of the Friar Lands Act as there was no required approval by the Secretary of Agriculture and Natural Resources. There is no dispute here that the land involved in this case is a friar land and that the laws which are applicable are Act No. 1120, know as the Friar Lands Act, providing for the administration and temporary leasing and sale of certain haciendas and parcels of land, commonly known as friar lands, and Commonwealth Act No. 32 dated September 15, 1936 as amended by Commonwealth Act No. 316 dated June 9, 1938, which provided for the subdivision and sale of all the portions of the friar lands estated remaining undisposed of. Sec. 12 of Act No. 1120 provides in part: . . . the Chief of the Bureau of Public Lands shall give the said settler and occupant a certificate which shall set forth in detail that the Government has agreed to sell to such settler and occupant the amount of land so held by him at the price so fixed payable as provided in this Act at the Office of the Chief of the Bureau of Public Lands . . . and that upon the payment of the final installment together with all accrued interest the Government will convey to such settler and occupant the said land so held by him by proper instrument of conveyance, which shall be issued and become effective in the manner provided in section one hundred and twenty two of the Land Registration Act. Also, Sec. 18 of the same Act provides: No lease or sale made by the Chief of the Bureau of Public Lands under the provisions of this Act shall be valid until approved by the Secretary of the Interior. (Emphasis ours) Similarly, Sec. 2 of C.A. No. 32, as amended by C.A. No. 316 provides in part: . . . The persons who, at the time of the subdivision survey are actual and bona fide occupants of any portion of the Friar Lands Estates, not exceeding ten hectares, shall be given preference to purchase the portion occupied at a private sale and at a price to be fixed in such case , by the Director of Lands, subject to the approval of the Secretary of Agriculture and Commerce , after taking into consideration its location, quality, and any other circumstances as may affect its value, the provisions of section twelve of Act Numbered Eleven hundred and twenty, as amended, to the contrary, . . . (Emphasis ours)

It is clear from the foregoing provisions that the friar lands were purchased by the government for sale to actual settlers and occupants at the time said lands are acquired by the government. The Bureau of Lands shall first issue a certificate stating therein that the government has agreed to sell the land to such settler or occupant. The latter then shall accept the certificate and agree to pay the purchase price so fixed and in the installments and at the interest specified in the certificate. The conveyance executed in favor of a buyer or purchaser, or the so called certificate of sale, is a conveyance of the ownership of the property, subject only to the resolutory condition that the sale may be cancelled if the price agreed upon is not paid for in full. The purchaser becomes the owner upon the issuance of the certificate of sale in his favor subject only to the cancellation thereof in case the price agreed upon is not paid (Pugeda vs. Trias, No. L-16925, March 31, 1962, 4 SCRA 849.) Upon the payment of the final installment together with all accrued interests, the government shall then issue a final deed of conveyance in favor of the purchaser. However, the sale of such friar lands shall be valid only if approved by the Secretary of Interior as provided in Act No. 1120. Later laws, however, required that the sale shall be approved by the Secretary of Agriculture and Commerce. In short, the approval by the Secretary of Agriculture and Commerce is indispensable for the validity of the sale. It is undisputed that petitioner's predecessor, Julian Pearanda was the actual occupant of Lot 7449 when he filed his application to purchase the said lot on November 22, 1968; that on December 16, 1989, the Secretary of Agriculture and Natural Resources approved the sale of the lot without auction to Pearanda; that a sales contract was executed between the Director of Lands and Pearanda on February 28, 1969 for a consideration of P 1,198.00 payable in 10 monthly installments; that upon the full payment of the price, the Undersecretary of Agriculture and Natural Resources issued the final deed of conveyance of Lot No. 7449 in favor of Pearanda. Subsequently, the Register of Deeds of Cavite issued TCT No. 39631 in the name of Pearanda, and when the latter sold the land to petitioner, TCT No. 39631 was cancelled and TCT No. T-80889 was issued in favor of the latter. Clearly, the purchase of the friar land made by Pearanda was in compliance with law. The execution of the sales contract vested the right of ownership in Pearanda over the land. There is no doubt whatsoever that the said sale was valid as it was approved by the Secretary of Agriculture and Natural Resources. Hence, the sale made by Pearanda in favor of the petitioner transferred the ownership of the land in favor of the latter resulting in the proper issuance of TCT No. T-80889 in its name. On the other hand, the antecedents leading to the acquisition of title by respondent Virata are clearly shown in the records. The latter's predecessor, Mabini Legaspi bought Lot 7449 in a sale by public auction held on May 5, 1943 conducted by the Bureau of Lands and friar lands agent Severino Rivera, and paid the purchase price thereof in installments in 1943; that on December 12, 1944, the Bureau of Lands sent a letter to the Register of Deeds of Cavite requesting the issuance of certificates of title to several persons including Mabini Legaspi, in whose favor TCT A-2188 was issued; that subsequently on December 6, 1957, she sold the disputed land to respondent Virata, which was evidenced by a deed of sale registered with the Registry of Deeds of Cavite on December 10, 1957; that on the same date, TCT No. 11520 was issued in the name of Virata. Due to the fire which gutted the building housing the Registry of Cavite on June 7, 1959, the latter administratively reconstituted the original of TCT No. 11520 on September 1, 1959, based on the owner's duplicate certificate and renumbered the same as TCT No. 1120 RT 1660. Apparently, the sale of the lot to Mabini Legaspi occurred much earlier than the date of acquisition of same lot by petitioner's predecessor, and the evidence presented by respondent Virata indicates that the latter's predecessor paid the purchase price of Lot No. 7449 on installments. Nowhere in the evidence for the respondent or in the records of this case however, would show that a certificate of sale was ever issued by the Bureau of Lands, which would vest ownership and title over the land in favor of Mabini Legaspi. The existence of the official receipts showing payment of the price of the land by Legaspi does not prove that the land was legally conveyed to her without any contract of sale having been executed by the government in her favor. Viewed from all angles, the acquisition of the lot by Legaspi was highly irregular and void, and not in compliance with the procedure mandated by law for the sale of friar lands. For one thing, Mabini Legaspi allegedly purchased the land in a sale at public auction, which procedure is nowhere provided in Act No. 1120 or in C.A. 32, as amended by C.A. 316. The laws expressly state that an actual occupant of the land shall purchase the lot occupied by him at a private sale and not in a sale at public auction (Sec. 2, C.A. 32 as amended). Further, neither was there any deed of conveyance issued to Legaspi by the government after the full payment of the installments on the disputed lot. Highly significant at this point is the ' e fact that there was neither allegation nor proof that the sale was with the approval of the Secretary of Agriculture and Commerce. The absence of such approval made the supposed sale null and void ab initio. Without the certificate of sale to prove the transfer of the ownership of the land from the government Mabini Legaspi and without the required approval of the sale by the Secretary of Agriculture and Commerce, We find that Mabini Legaspi did not in any manner acquire ownership over the land in 1943. The ownership or title over the friar land, specifically Lot No. 7449 remained in the government until Pearanda, petitioners predecessor, lawfully acquired ownership over the same lot on February 28, 1969 by virtue of a sales contract executed in his favor. The issuance of a certificate of title in favor of Mabini Legaspi did not vest ownership upon her over the land nor did it validate the alleged purchase of the lot, which is null and void. Time and again, it has been held that registration does not vest title. It is merely evidence of such title over a particular property. Our land registration laws do not give the holder any better title than that what he actually has (De man et al. vs. Court of Appeals, G.R. L- 46935 December 21, 1987, 156 SCRA 701; Cruz vs. Cabana, No. 56232, June 22, 1984, 129 SCRA 656).

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