Last Minute Tips Bar

Republic of the Philippines
Supreme Court
Manila
FIRST DIVISION
LUCIA RODRIGUEZ AND G.R. No. 171972

PRUDENCIA RODRIGUEZ,
Petitioners, Present:
CORONA, C. J., Chairperson,

VELASCO, JR.,
- versus- LEONARDO-DE CASTRO,
DEL CASTILLO, and
PEREZ, JJ.
TERESITA V. SALVADOR, Promulgated:

Respondent. June 8, 2011
x--------------------------------------------------------x
DECISION
DEL CASTILLO, J.:
Agricultural tenancy is not presumed but must be proven by the person alleging it.
This Petition for Certiorari[1] under Rule 65 of the Rules of Court assails the August
24, 2005 Decision[2] and the February 20, 2006 Resolution[3] of the Court of Appeals (CA) in
CA G.R. SP No. 86599. However, per Resolution[4] of this Court dated August 30, 2006, the
instant petition shall be treated as a Petition for Review on Certiorari under Rule 45 of the
same Rules.
Factual Antecedents
On May 22, 2003, respondent Teresita V. Salvador filed a Complaint for Unlawful
Detainer,[5] docketed as Civil Case No. 330, against petitioners Lucia (Lucia) and Prudencia
Rodriguez, mother and daughter, respectively before the Municipal Trial Court (MTC) of
Dalaguete, Cebu.[6] Respondent alleged that she is the absolute owner of a parcel of land
covered by Original Certificate of Title (OCT) No. P-27140[7] issued by virtue of Free Patent
No. (VII-5) 2646 in the name of the Heirs of Cristino Salvador represented by Teresita
Salvador;[8] that petitioners acquired possession of the subject land by mere tolerance of her
predecessors-in-interest;[9] and that despite several verbal and written demands made by her,
petitioners refused to vacate the subject land.[10]
In their Answer,[11] petitioners interposed the defense of agricultural tenancy. Lucia

claimed that she and her deceased husband, Serapio, entered the subject land with the consent
and permission of respondents predecessors-in-interest, siblings Cristino and Sana Salvador,
under the agreement that Lucia and Serapio would devote the property to agricultural
production and share the produce with the Salvador siblings.[12] Since there is a tenancy
relationship between the parties, petitioners argued that it is the Department of Agrarian
Reform Adjudication Board (DARAB) which has jurisdiction over the case and not the
MTC.[13]
On July 10, 2003, the preliminary conference was terminated and the parties were
ordered to submit their respective position papers together with the affidavits of their witnesses
and other evidence to support their respective claims.[14]
Ruling of the Municipal Trial Court
On September 10, 2003, the MTC promulgated a Decision[15] finding the existence of
an agricultural tenancy relationship between the parties, and thereby, dismissing the complaint
for lack of jurisdiction. Pertinent portions of the Decision read:
Based on the facts presented, it is established that defendant Lucia

Rodriguez and her husband Serapio Rodriguez were instituted as agricultural
tenants on the lot in question by the original owner who was the
predecessor-in-interest of herein plaintiff Teresita Salvador. The consent
given by [the]original owner to constitute [defendants] as agricultural tenants
of subject landholdings binds plaintiff who as successor-in-interest of the
original owner Cristino Salvador steps into the latters shoes acquiring not
only his rights but also his obligations towards the herein defendants. In the
instant case, the consent to tenurial arrangement between the parties is
inferred from the fact that the plaintiff and her successors-in-interest had
received their share of the harvests of the property in dispute from the
defendants.
Moreover, dispossession of agricultural tenants can only be ordered
by the Court for causes expressly provided under Sec. 36 of R.A. 3844.
However, this Court has no jurisdiction over detainer case involving
agricultural tenants as ejectment and dispossession of said tenants is within
the primary and exclusive jurisdiction of the Department of Agrarian Reform
and Agricultural Board (DARAB). ([S]ee Sec. 1(1.4) DARAB 2003 Rules of
Procedure[.])
WHEREFORE, in view of the foregoing, the instant complaint is
hereby ordered DISMISSED for lack of jurisdiction.
SO ORDERED.[16]
Aggrieved, respondent filed an appeal, docketed as Civil Case No. AV-1237, with the
Regional Trial Court (RTC) of Argao, Cebu, Branch 26.[17]
Ruling of the Regional Trial Court
On January 12, 2004, the RTC rendered a Decision[18] remanding the case to
the MTC for preliminary hearing to determine whether tenancy relationship exists between
the parties.
Petitioners moved for reconsideration[19] arguing that the purpose of a preliminary

hearing was served by the parties submission of their respective position papers and other
supporting evidence.
On June 23, 2004, the RTC granted the reconsideration and affirmed the MTC
Decision dated September 10, 2003. The fallo of the new Decision[20] reads:
WHEREFORE, the motion for reconsideration is GRANTED. The

Decision dated September 10, 2003 of the Municipal Trial Court of
Dalaguete, Cebu, is hereby AFFIRMED.
IT IS SO DECIDED.[21]
Respondent sought reconsideration[22] but it was denied by the RTC in an

Order[23] dated August 18, 2004.
Thus, respondent filed a Petition for Review[24] with the CA, docketed as CA G.R. SP
No. 86599.
Ruling of the Court of Appeals
On August 24, 2005, the CA rendered judgment in favor of respondent. It ruled that no
tenancy relationship exists between the parties because petitioners failed to prove that
respondent or her predecessors-in-interest consented to the tenancy relationship.[25] The
CA likewise gave no probative value to the affidavits
of petitioners witnesses as it found their statements insufficient to establish petitioners status as
agricultural tenants.[26] If at all, the affidavits merely showed that petitioners occupied the
subject land with the consent of the original owners.[27] And since petitioners are occupying the
subject land by mere tolerance, they are bound by an implied promise to vacate the same upon
demand by the respondent.[28] Failing to do so, petitioners are liable to pay damages.[29] Thus,
the CA disposed of the case in this manner:
WHEREFORE, in view of all the foregoing premises, judgment is

hereby rendered by us SETTING ASIDE, as we hereby set aside, the
decision rendered by the RTC of Argao, Cebu on June 23, 2004 in Civil Case
No. AV-1237 and ORDERING the remand of this case to the MTC of
Dalaguete, Cebu for the purpose of determining the amount of actual
damages suffered by the [respondent] by reason of the [petitioners] refusal
and failure to turn over to [respondent] the possession and enjoyment of the
land and, then, to make such award of damages to the [respondent].
SO ORDERED.[30]
Issues
Hence, this petition raising the following issues:
I.
WHETHER X X X THE COURT OF APPEALS ACTED WITH GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS
OF JURISDICTION IN RULING THAT PETITIONERS-DEFENDANTS
ARE NOT TENANTS OF THE SUBJECT LAND.
II.
WHETHER X X X SUCH RULING OF THE COURT OF APPEALS HAS
FACTUAL AND LEGAL BASIS AND IS SUPPORTED WITH
SUBSTANTIAL EVIDENCE.[31]
Petitioners Arguments
Petitioners contend that under Section 5[32] of Republic Act No. 3844, otherwise
known as the Agricultural Land Reform Code, tenancy may be constituted by agreement of the
parties either orally or in writing, expressly or impliedly.[33] In this case, there was an implied
consent to constitute a tenancy relationship as respondent and her predecessors-in-interest
allowed petitioners to cultivate the land and share the harvest with the landowners for more
than 40 years.[34]
Petitioners further argue that the CA erred in disregarding the affidavits executed by
their witnesses as these are sufficient to prove the existence of a tenancy
relationship.[35] Petitioners claim that their witnesses had personal knowledge of the cultivation
and the sharing of harvest.[36]
Respondents Arguments
Respondent, on the other hand, maintains that petitioners are not agricultural tenants because
mere cultivation of an agricultural land does not make the tiller an agricultural
tenant.[37]Respondent insists that her predecessors-in-interest merely tolerated petitioners
occupation of the subject land.[38]
Our Ruling
The petition lacks merit.
Agricultural tenancy relationship does not

exist in the instant case.
Agricultural tenancy exists when all the following requisites are present: 1) the parties
are the landowner and the tenant or agricultural lessee; 2) the subject matter of the relationship
is an agricultural land; 3) there is consent between the parties to the relationship; 4) the purpose
of the relationship is to bring about agricultural production; 5) there is personal cultivation on
the part of the tenant or agricultural lessee; and 6) the harvest is shared between landowner and
tenant or agricultural lessee.[39]
In this case, to prove that an agricultural tenancy relationship exists between the parties,
petitioners submitted as evidence the affidavits of petitioner Lucia and their neighbors. In her
affidavit,[40] petitioner Lucia declared that she and her late husband occupied the subject land
with the consent and permission of the original owners and that their agreement was that she
and her late husband would cultivate the subject land, devote it to agricultural production, share
the harvest with the landowners on a 50-50 basis, and at the same time watch over the
land. Witness Alejandro Arias attested in his affidavit[41] that petitioner Lucia and her husband,
Serapio, have been cultivating the subject land since 1960; that after the demise of Serapio,
petitioner Lucia and her children continued to cultivate the subject land; and that when
respondents predecessors-in-interest were still alive, he would often see them and respondent
get some of the harvest.The affidavit[42] of witness Conseso Muoz stated, in essence, that
petitioner Lucia has been in peaceful possession and cultivation of the subject property since
1960 and that the harvest was divided into two parts, for the landowner and for petitioner
Lucia.
The statements in the affidavits presented by the petitioners are not sufficient to prove
the existence of an agricultural tenancy.
As correctly found by the CA, the element of consent is lacking.[43] Except for the
self-serving affidavit of Lucia, no other evidence was submitted to show that respondents
predecessors-in-interest consented to a tenancy relationship with petitioners. Self-serving
statements, however, will not suffice to prove consent of the landowner; independent evidence
is necessary.[44]
Aside from consent, petitioners also failed to prove sharing of harvest. The affidavits
of petitioners neighbors declaring that respondent and her predecessors-in-interest received
their share in the harvest are not sufficient. Petitioners should have presented receipts or any
other evidence to show that there was sharing of harvest[45] and that there was an agreed system
of sharing between them and the landowners.[46]
As we have often said, mere occupation or cultivation of an agricultural land will

not ipso facto make the tiller an agricultural tenant.[47] It is incumbent upon a person who
claims to be an agricultural tenant to prove by substantial evidence all the requisites of
agricultural tenancy.[48]
In the instant case, petitioners failed to prove consent and sharing of harvest between
the parties. Consequently, their defense of agricultural tenancy must fail. The MTC has
jurisdiction over the instant case. No error can therefore be attributed to the CA in reversing
and setting aside the dismissal of respondents complaint for lack of jurisdiction. Accordingly,
the remand of the case to the MTC for the determination of the amount of damages due
respondent is proper.
Respondent is entitled to the fair rental

value or the reasonable compensation for
the use and occupation of the subject land.
We must, however, clarify that the only damage that can be recovered [by respondent]
is the fair rental value or the reasonable compensation for the use and occupation of the leased
property. The reason for this is that [in forcible entry or unlawful detainer cases], the only issue
raised in ejectment cases is that of rightful possession; hence, the damages which could be
recovered are those which the [respondent] could have sustained as a mere possessor, or those
caused by the loss of the use and occupation of the property, and not the damages which [she]
may have suffered but which have no direct relation to [her] loss of material possession.[49]
WHEREFORE, the petition is DENIED. The assailed August 24, 2005 Decision
and the February 20, 2006 Resolution of the Court of Appeals in CA G.R. SP No. 86599
are AFFIRMED. This case is ordered REMANDED to the Municipal Trial Court of
Dalaguete, Cebu, to determine the amount of damages suffered by respondent by reason of
the refusal and failure of petitioners to turn over the possession of the subject land, with
utmost dispatch consistent with the above disquisition.
SO ORDERED.
MARIANO C. DEL CASTILLO

Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
Chairperson
PRESBITERO J. VELASCO, JR. TERESITA J. LEONARDO-DE

Associate Justice CASTRO
Associate Justice
JOSE PORTUGAL PEREZ

Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the
conclusions in the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Courts Division.
RENATO C. CORONA
Chief Justice
[1]
Rollo, pp. 3-134, with Annexes A to R inclusive.
[2]
Id. at 23-32; penned by Associate Justice Isaias P. Dicdican and concurred in by Associate
Justices Vicente L. Yap and Enrico A. Lanzanas.
[3]
Id. at 40-41.
[4]
Id. at 148. In the May 2, 2006 Resolution (id. at 136), the Court dismissed the
petition for certiorari for being a wrong mode of appeal; the petition was
evidently used as a substitute for the lost remedy of appeal; and for failure to
sufficiently show that the Court of Appeals committed grave abuse of discretion in
rendering the assailed Decision and Resolution. Petitioners moved for
reconsideration which was granted in the August 30, 2006 Resolution. We thus
reinstated the petition and treat the same as a petition for review
on certiorari under Rule 45 of the Rules of Court.
[5]
Id. at 42-52.
[6]
Id. at 24.
[7]
Id. at 47.
[8]
Id. at 42.
[9]
Id. at 43.
[10]
Id. at 43-44.
[11]
Id. at 53-59.
[12]
Id. at 54.
[13]
Id. at 56-57.
[14]
Id. at 60-61.
[15]
Id. at 81-84; penned by Presiding Judge Thelma N. De Los Santos.
[16]
Id. at 84.
[17]
Id. at 27.
[18]
Id. at 99; penned by Judge Maximo A. Perez.
[19]
Id. at 100-102.
[20]
Id. at 103-104.
[21]
Id. at 104.
[22]
Records, pp. 145-148.
[23]
CA rollo, p. 66.
[24]
Rollo, pp. 105-117.
[25]
Id. at 29.
[26]
Id. at 29-30.
[27]
Id. at 30.
[28]
Id. at 30-31.
[29]
Id. at 31.
[30]
Id.
[31]
Id. at 10.
[32]
SECTION 5. Establishment of Agricultural Leasehold Relation. The agricultural
leasehold relation shall be established by operation of law in accordance with
Section four of this Code and, in other cases, either orally or in writing, expressly
or impliedly.
[33]
Rollo, p. 178.
[34]
Id. at 178-179.
[35]
Id. at 180-183.
[36]
Id. at 181.
[37]
Id. at 193.
[38]
Id. at 192.
[39]
Soliman v. Pampanga Sugar Development Company (PASUDECO), Inc., G.R. No.
169589, June 16, 2009, 589 SCRA 236, 246.
[40]
Rollo, pp. 75-76.
[41]
Id. at 79-80.
[42]
Id. at 77-78.
[43]
Id. at 29.
[44]
De Jesus v. Moldex Realty, Inc., G.R. No. 153595, November 23, 2007, 538
SCRA 316, 322.
[45]
Landicho v. Sia, G.R. No. 169472, January 20, 2009, 576 SCRA 602,
621; Adriano v. Tanco, G.R. No. 168164, July 5, 2010, 623 SCRA 218, 229.
[46]
Heirs of Jose Barredo v. Besaes, G.R. No. 164695, December 13, 2010, citing De
Jesus v. Moldex Realty, Inc., supra at 323.
[47]
Landicho v. Sia, supra at 620.
[48]
NICORP Management and Development Corporation v. De Leon, G.R. Nos.
176942 & 177125, August 28, 2008, 563 SCRA 606, 612.
[49]
Araos v. Court of Appeals, G.R. No. 107057, June 2, 1994, 232 SCRA 770, 776.
G.R. No. 176043 January 15, 2014
SPOUSES BERNADETTE and RODULFO VILBAR, Petitioners,

vs.
ANGELITO L. OPINION, Respondent.
DECISION
DEL CASTILLO, J.:

"Registration is the operative act which gives validity to the transfer or creates a lien
upon the land."1 Before this Court is a Petition for Review on Certiorari2 of the May
26, 2006 Decision3 of the Court of Appeals (CA) in CA-G.R. CV No. 84409 which
affirmed the January 31, 2005 Decision4 of the Regional Trial Court (RTC), Branch
255, Las Piñas City in Civil Case No. 98-0302, an accion reinvindicatoria case filed
by respondent Angelito L Opinion (Opinion) against petitioner-spouses Bernadette
and Rodulfo Vilbar (spouses Vilbar) and others.
Also assailed is the CA' s December 22, 2006 Resolution5 which denied spouses
Vilbar's Motion for Reconsideration.6
Factual Antecedents
Spouses Vilbar claimed that on July 10, 1979, they and Dulos Realty and
Development Corporation (Dulos Realty), entered into a Contract to Sell 7 involving a
108-square meter lot designated as Lot 20-B located in Airmen’s Village, Las Piñas
City and covered by Transfer Certificate of Title (TCT) No. S-39849 for ₱19,440.00.
Lot 20-A which is also covered and embraced by the same certificate of title is the
subject of another Contract to Sell between Elena Guingon (Elena) and Dulos Realty.
Sometime in August 1979, spouses Vilbar took possession of Lot 20-B in the concept
of owners and exercised acts of ownership thereon with the permission of Dulos
Realty after making some advance payment.8
Upon full payment of the purchase price for Lot 20, or on June 1, 1981, Dulos Realty
executed a duly notarized Deed of Absolute Sale9 in favor of spouses Vilbar and their
co-purchaser Elena. Dulos Realty also surrendered and delivered the owner’s
duplicate copy of TCT No. S-39849 covering Lot 20 to the buyers and new owners of
the property. However, spouses Vilbar and Elena were not able to register and transfer
the title in their names because Dulos Realty allegedly failed to have the lot formally
subdivided despite its commitment to do so, until its President, Juan B. Dulos (Juan),
died without the subdivision being accomplished.10
Spouses Vilbar and Dulos Realty also executed a Contract to Sell11 dated July 10,
1979 covering Lot 21, Block 4 of Airmen’s Village, with an area of 216 square meters
and covered by TCT No. S-39850 amounting to ₱128,880.00. To pay for the balance
of the purchase price amounting to ₱99,216.00, spouses Vilbar obtained a housing
loan from the Development Bank of the Philippines (DBP) secured by a real estate
mortgage12 over the said lot. Dulos Realty facilitated the approval of the loan, the
proceeds of which were immediately paid to it as full payment of the purchase price.13
In 1991, the spouses Vilbar were able to pay the loan in full and DBP issued the
requisite Cancellation of Mortgage14 on March 25, 1991. Thereafter, DBP surrendered
TCT No. 36777 / T-17725-A issued by the Registry of Deeds of Pasay City in the
name of Bernadette Vilbar to the spouses Vilbar.15 The spouses Vilbar have been in
actual, open and peaceful possession of Lot 21 and occupy the same as absolute
owners since 1981.
In contrast, Opinion claimed that he legally acquired Lots 20 and 21 through
extra-judicial foreclosure of mortgage constituted over the said properties by Otilio
Gorospe, Sr. and Otilio "Lito" Gorospe, Jr. (Gorospes) in his favor. Opinion alleged
that on January 12, 1995, the Gorospes borrowed ₱440,000.00 and, to secure the loan,
executed a Deed of Real Estate Mortgage16 over the subject lots covered by TCT Nos.
T-44796 (Lot 21)17 and T-44797 (Lot 20).18 The Gorospes defaulted, prompting
Opinion to file a Petition for Extra-Judicial Foreclosure of Real Estate
Mortgage19 dated October 17, 1995 with the Office of the Notary Public of Las Piñas
City. Subsequently, the subject properties were sold at a public auction where Opinion
emerged as the highest bidder. A Certificate of Sale20 was issued in his favor on
December 18, 1995 and subsequently annotated on the TCTs of the properties. The
Gorospes failed to redeem the properties within the reglementary period resulting in
the eventual cancellation of their titles. Thus, TCT No. T-59010 (Lot 21)21 and TCT
No. T-59011 (Lot 20)22 in the name of Opinion were issued on January 22, 1997 by
the Registry of Deeds of Las Piñas City.
On February 13, 1997, Opinion filed a Petition for Issuance of a Writ of

Possession23 against the Gorospes with the RTC of Las Piñas City, Branch 253,
docketed as LRC Case No. LP-162. Branch 253 initially issued a Writ of Possession
and spouses Vilbar and Elena were served with a notice to vacate the premises.
However, the writ was quashed when spouses Vilbar filed an urgent motion for the
quashal of the writ and presented their title to Lot 21, while Elena presented the Deed
of Absolute Sale executed by Dulos Realty covering Lot 20. Consequently, Opinion
filed a Complaint for Accion Reinvindicatoria with Damages24 docketed as Civil Case
No. 98-0302 and raffled to Branch 255 of the RTC of Las Piñas City for him to be
declared as the lawful owner and possessor of the subject properties and for his titles
to be declared as authentic. He likewise prayed for the cancellation of the titles of
spouses Vilbar and Elena.25
During trial, spouses Vilbar presented the Absolute Deed of Sale26 executed by Dulos
Realty in their favor and the owner’s duplicate copy of TCT No. S-3984927 covering
Lot 20. With respect to Lot 21, spouses Vilbar presented the real estate
mortgage28 they executed in favor of DBP; the official receipts29 issued by DBP
showing that they had paid the amortizations for the housing loan; the Cancellation of
Mortgage30 issued by DBP as proof that they have fully paid the loan; tax
declarations31 and receipts32 to show that the property’s tax declaration under the
name of Dulos Realty had been cancelled and a new one had been issued in their
name in 1987 and that they have been paying the real property taxes on the property
since 1980. The spouses Vilbar also presented TCT No. 36777/T-17725-A33 issued by
the Registry of Deeds of Pasay City on May 22, 1981, as proof of their ownership of
Lot 21.
Opinion, on the other hand, justified the legality of his claim over the properties by
tacking his rights on the rights passed on to him by the Gorospes. He traced his rights
over the properties by claiming that Gorospe, Sr. was the former chairman of the
Board of Directors and Chief Executive Officer (CEO) of Dulos Realty. He was
offered substantial benefits and privileges by Dulos Realty as compensation for the
positions he held, including a residential house and lot in Airmen’s Village, Las Piñas
City valued at ₱180,000.00 and various allowances. However, Dulos Realty was not
able to give to Gorospe, Sr. the promised allowances despite repeated demands. Thus,
Gorospe, Sr. was constrained to file a Complaint for Sum of Money, Specific
Performance and Damages34 dated May 12, 1981 with the then Court of First Instance
(CFI) of Manila. Subsequently, Juan signed a compromise agreement and based
thereon the trial court rendered a Decision35 dated April 1, 1982 ordering Dulos
Realty to pay Gorospe, Sr. the total amount of ₱578,000.00. A Writ of Execution and
Alias Writ of Execution were issued by the trial court in its Orders36 dated May 7,
1982 and September 30, 1983, respectively. Dulos Realty filed several cases
challenging the validity of the compromise agreement and seeking to nullify the writs
of execution, as well as the consequent levy and public auction sale of its
properties.37 One of the cases it filed was Civil Case No. 88-280038 seeking the
nullification, cancellation and reconveyance of title on the ground, among others, that
during the auction sale its properties were undervalued. All of its efforts, however,
proved futile. Meanwhile, real properties of Dulos Realty were levied on October 31,
1984, which included Lots 20 and 21 covered by TCT Nos. S-39849 and S-39850,
respectively.39 The disputed properties were eventually sold at public auction on June
24, 1985 where Gorospe, Sr. emerged as the highest bidder.40 On June 2, 1987, the
Registry of Deeds of Pasay City issued TCT Nos. 117331 (Lot 20)41 and 117330 (Lot
21)42 in the name of Gorospe, Sr. and his wife. Upon the death of Gorospe, Sr.’s wife,
the Gorospes transferred the titles in their names resulting in the issuance of TCT Nos.
T-44797 (Lot 20)43 and T-44796 (Lot 21)44 by the Registry of Deeds of Las Piñas
City.
During the course of the trial, Opinion likewise stated under oath that prior to the
execution of the real estate mortgage between him and the Gorospes, he was given
copies of the titles to the properties which he verified with the Registry of Deeds to be
authentic45 and that he inspected the subject properties and learned that there were
occupants.46 Opinion stated that he was informed by the Gorospes that the occupants,
spouses Vilbar and Elena, were mere tenants renting from them.47 Opinion admitted
that he neither talked to the occupants nor made any inquiries as to the nature of their
occupation over the subject properties;48 he did not inquire further to determine
whether there was a pending controversy;49 and, that he merely relied on the
statements of Gorospe, Sr. regarding the tenancy of the occupants without having
been shown any contract of lease, proof of rental payments, or even an electric bill
statement.50
It was only after his Writ of Possession was quashed when he learned that spouses
Vilbar and Elena are also claiming ownership over the properties, prompting him to
make a more thorough investigation.51 Opinion stated that despite the discovery of the
adverse claims over the properties mortgaged to him, he did not ask Gorospe, Sr. why
there are other claimants to the subject properties.52 When asked about what he
learned after investigating said claims, he declared that the titles of the spouses Vilbar
are spurious because they contain discrepancies with the originals on file with the
Registry of Deeds. According to Opinion, spouses Vilbar’s titles do not have entries
indicating the titles from which they were derived.53 To bolster his claim, Opinion
also presented a 2nd Indorsement54 dated May 11, 1988 issued by the Registry of
Deeds of Pasay City which states that TCT No. 36777 of the spouses Vilbar is
presumed to be not validly issued.55 Upon clarification, however, Opinion admitted
that he made no further follow-up with the Registry of Deeds to determine the final
outcome of the investigation on the title of the spouses Vilbar.56
On January 31, 2005, the trial court rendered its Decision57 in favor of Opinion
declaring that he lawfully acquired the disputed properties and that his titles are valid,
the sources of which having been duly established.58 The dispositive portion of the
Decision reads:
WHEREFORE, the foregoing considered, judgment is hereby rendered in favor of

plaintiff Angelito L. Opinion, and against defendants Sps. Bernadette and Rodulfo
Vilbar, including defendants Otilio Gorospe, Sr., Otilio Gorospe, Jr. and Elena
Guingon, ordering the said defendants to immediately turn over possession of Lots 20
and 21, both of Block 4, located at Airmen’s Village, Las Piñas City, to the herein
plaintiff being the registered owner thereof per TCT Nos. T-59010 and T-59011
issued in his name.
Likewise, the above defendants are hereby directed to pay to the herein plaintiff the
sum of ₱100,00.00 as and by way of attorney’s fees, including the cost of suit.
SO ORDERED.59
The trial court, in ruling for Opinion, ratiocinated that there was no doubt that
Opinion’s predecessors-in-interest likewise acquired title to the properties through
lawful means.60 Titles originally in the name of Dulos Realty were cancelled after
implementation and execution of the April 1, 1982 Decision of the CFI in favor of
Gorospe, Sr. and new titles were issued in his name.61 The trial court noted that when
a new title for Lot 21 was issued in the name of Gorospe, Sr. on June 2, 1987, there
was no indication that the title of Dulos Realty was already cancelled by Bernadette
Vilbar’s TCT No. 36777 purporting to have been issued on May 22, 1981.62 As to Lot
20, the trial court noted that the supposed Deed of Absolute Sale dated June 1, 1981 in
favor of defendants Bernadette Vilbar and Guingon was not annotated on TCT No.
39849. Thus, when this was cancelled by the subsequent titles, the property was not
subject to any lien or encumbrance whatsoever pertaining to said purported Deed of
Absolute Sale.63 The trial court also opined that the efforts of Dulos Realty to
question and annul the earlier rulings of the then Intermediate Appellate Court and
Supreme Court did not prosper thereby strengthening the validity of the title of the
Gorospes.64 Further, the trial court found the mortgage in favor of Opinion, and the
subsequent extrajudicial foreclosure thereof to be in order.65
As to spouses Vilbars’ evidence, the trial court found their title to Lot 21 questionable
as there was no showing that it came from TCT No. 39850 issued in the name of
Dulos Realty.66 The Contract to Sell of the spouses Vilbar can hardly serve as basis
for the transfer of Lot 21 in their favor. Besides, the same was not even annotated on
the title of Dulos Realty.67 The trial court also found the issuance of TCT No. 36777
questionable because there was no proof that the purchase price was already paid
considering that only a Contract to Sell was available. As a result, spouses Vilbar only
had an inchoate right over the property.68 The trial court went on to state:
Definitely, defendants Sps. Vilbar cannot readily claim that they acquired Lot 21 in
good faith and for value. Based on the documents they presented, they cannot assert
ignorance or allege that they were not aware that the purchase price for Lot 21,
including any interest they may have in Lot 20, has not been duly settled at the time
TCT No. 36777 for Lot 21 was issued in their favor or even when the Deed of
Absolute Sale dated 01 June 1981 for Lot 20 was executed.
The payments supposedly made by the defendants Sps. Vilbar to the DBP only
establishes the fact that they have not complied with what they obligated themselves
with insofar as the above contracts to sell are concerned. More importantly, there is
nothing in the records which would show that these contracts have been superseded
by another deed to justify the transfer, among others, of TCT No. 39850 registered in
the name of the defendant Dulos Realty to the defendants Sps. Vilbar, or the
execution of a deed of sale involving Lot 20 covered by TCT No. 39849. Needless to
state, the fact that a mortgage contract was allegedly entered into by the defendants
Sps. Vilbar with the DBP does not, by itself, result in a conclusive presumption that
they have a valid title to Lot 21. Instead, this begs more questions than answers since
the said mortgage was entered into on 21 May 1981, or a day after TCT No. 36777
was issued in favor of the defendants Sps. Vilbar. Added to this, the herein defendants
failed to establish the basis for the issuance of their said title even when their
contracts to sell indicate that the purchase price for Lot 21 would be paid on
installments over a long period of time.
As to the tax declarations and real property tax payments made by the defendants Sps.
Vilbar for Lot 21 the same are of no moment. It has been held that tax declarations are
not conclusive proofs of ownership, let alone of the private character of the land – at
best, they are merely ‘indicia of a claim of ownership.’ (Seville v. National
Development Company, 351 SCRA 112) However, and with the plaintiff presenting
convincing evidence of the basis and validity of his acquisition of the subject lots,
such "indicia" in favor of the defendants Sps. Vilbar had been effectively impugned or
refuted.
Moreso, the possession of the alleged original owner’s copy of TCT No. 39849 for
Lot 20 by the defendants Sps. Vilbar or the execution of a deed of sale in favor of
defendants Bernadette Vilbar and Guingon over the same cannot ripen into ownership
thereof. It must be stressed that no subsequent title was issued in favor of the said
defendants even when they have the above documents with them. On the other hand,
the plaintiff eventually secured a title over Lot 20 after consolidating his ownership
with respect thereto.
The fact that the defendants Sps. Vilbar are in possession of the subject lots cannot
persuade the Court to rule in their favor. This is more settled insofar as Lot 20 is
concerned. Having a valid title thereto, the claim of the plaintiff cannot just be
ignored. It is a fundamental principle in land registration that a certificate of title
serves as evidence of an indefeasible and incontrovertible title to the property in favor
of the person whose name appears therein. (Vda. De Retuerto vs. Barz, 372 SCRA
712)69
Further, the trial court gave much credence to the 2nd Indorsement dated May 11,
1988 from the Registry of Deeds of Pasay City which provided that TCT No. 36777 is
presumed not to be validly issued considering that no inscription exists at the back of
the original title (TCT No. S-39850) showing that a Deed of Sale between Dulos
Realty and spouses Vilbar had been registered. The discrepancy in the entries, or lack
of it, in the TCTs in the custody of the spouses Vilbar and the Registry of Deeds of
Las Piñas City70 also tilted the balance against the said spouses.
Aggrieved, the spouses Vilbar appealed to the CA on February 22, 2005.71
On May 26, 2006, the CA promulgated its Decision72 affirming the Decision of the
RTC. The CA agreed with the trial court’s ruling that Opinion validly acquired title
over Lots 20 and 21 through a valid mortgage, extrajudicial foreclosure, and eventual
consolidation proceedings instituted over the said properties.73 The CA went on to
state that there was no doubt as to the validity of the title of Opinion’s
predecessors-in-interest, the Gorospes, because the same was affirmed by the
Supreme Court in a case involving the said properties.74 In contrast, spouses Vilbar’s
TCT No. 36777 does not state the title from which it was derived.75 Spouses Vilbar’s
title becomes even more dubious in light of the aforementioned 2nd Indorsement
issued by the Registry of Deeds of Pasay City, which they failed to refute. 76 The CA
further stated that acquisitive prescription will not set in because spouses Vilbar
lacked the prerequisite just title, while the tax declaration is not a conclusive evidence
of ownership.77 As to Lot 20, the CA ratiocinated that the spouses Vilbar never
registered the property in their names despite the lapse of several years, while Opinion
was able to register the same property in his name. Being the registered owner,
Opinion’s title thus takes precedence over the unregistered claim of ownership of
spouses Vilbar.78
Lastly, the CA opined that it is the registration that binds the whole world and that
mere possession of the properties in question cannot defeat the right of Opinion as
registered owner of the property. Since the sale claimed by the spouses Vilbar was
never registered, it cannot bind Opinion.79
The spouses Vilbar moved for reconsideration of the CA Decision which was denied
in a Resolution dated December 22, 2006. Hence, this Petition.
Issues
Petitioners raise the following issues:
A.
THE HONORABLE COURT OF APPEALS SERIOUSLY

ERRED IN FINDING THAT THE RESPONDENT ANGELITO
OPINION HAS A BETTER TITLE AND/OR HAS
PREFERENCE OVER THE SUBJECT PROPERTIES
IDENTIFIED AS LOTS 20 AND 21.
B.
THE COURT OF APPEALS SERIOUSLY ERRED WHEN IT

OVERLOOKED THE FACT THAT OTILIO GOROSPE, AS
STOCKHOLDER AND CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER OF DULOS REALTY AND
RESPONDENT OPINION’S PREDECESSOR-IN-INTEREST,
ACTED IN BAD FAITH WHEN HE LEVIED ON EXECUTION
AND WHEN HE PURCHASED IN AN AUCTION SALE THE
TWO LOTS SUBJECT OF THE INSTANT CASE ALREADY
SOLD AND DELIVERED TO THE PETITIONERS BY DULOS
REALTY.
C.

ERRED WHEN IT OVERLOOKED THE FACT THAT X X X
RESPONDENT OPINION WAS LIKEWISE A PURCHASER IN
BAD FAITH.
D.

ERRED WHEN IT OVERLOOKED THAT THE PETITIONERS
SPOUSES VILBAR ARE THE OWNERS OF LOT[S] 21 AND 20
UPON DELIVERY THEREOF.
E.
THE COURT OF APPEALS ERRED IN ASSUMING THAT TCT

NO. 36777 WAS NOT VALIDLY ISSUED IN FAVOR OF THE
PETITIONERS.80
The pivotal issue to be resolved is: who between the parties has a better right
over Lots 20 and 21?
Petitioners contend that they are the rightful owners and possessors of the contested
properties through a valid sale perfected in 1981. They maintain that Gorospe, Sr., the
predecessor-in-interest of Opinion, did not acquire ownership over Lots 20 and 21
because at the time of the levy and execution, said properties were no longer owned
by Dulos Realty. Gorospe, Sr. could not, therefore, validly pass any rights to Opinion
which the former did not have in the first place.81
Our Ruling
The Court finds no merit in the Petition.

Respondent Opinion’s predecessor-in-
interest is an innocent third party
purchaser in the public auction sale,
absent proof to the contrary.
This Court notes that Dulos Realty, the former owner and common predecessor of the
parties herein, contracted with the spouses Vilbar for the sale and transfer of Lots 20
and 21 on July 10, 1979. As early as August 1979, the spouses Vilbar were already in
peaceful and actual possession of the subject properties and have been exercising acts
of ownership and dominion over their portion of Lot 20 and the entire Lot 21 despite
the fact that the purchase price of the lots have not yet been paid in full. Admittedly,
all these took place before Gorospe, Sr. filed his Complaint for Sum of Money,
Specific Performance and Damages against Dulos Realty on May 12, 1981; prior to
the issuance of the Writ of Execution and Alias Writ of Execution by the trial court on
May 7, 1982 and September 30, 1983, respectively;82 prior to the levy of the
properties of Dulos Realty on October 31, 1984 to answer for the judgment favorable
to Gorospe, Sr. in said collection/specific performance case; and prior to the public
auction sale held on June 24, 1985. However, the Court also notes that the sale of Lot
20 was not annotated on the original title in the name of Dulos Realty, while only a
Contract to Sell was executed between the spouses Vilbar and Dulos Realty as regards
Lot 21 which makes the issuance of the title in the name of Bernadette Vilbar
questionable. What makes spouses Vilbar’s title over Lot 21 even more doubtful is the
2nd Indorsement issued by the Registry of Deeds of Pasay City which states that
Bernadette Vilbar’s title over said lot is presumed to be not validly issued.
The spouses Vilbar contend that Gorospe, Sr. acted in bad faith when he levied on the
disputed properties and bought them at public auction. However, this Court cannot
treat as significant the alleged fact that Gorospe, Sr. was the Chief Executive Officer
and Chairman of the Board of Directors of Dulos Realty at the time the transactions
with the spouses Vilbar were entered into by the company. Evidence on record shows
that the Deed of Absolute Sale dated June 1, 1981 covering Lot 20, as well as the
Contract to Sell over Lot 21, was signed by Juan as President of Dulos Realty. Simply,
spouses Vilbar cannot ascribe bad faith on the part of Gorospe, Sr. absent clear and
convincing proof that he had knowledge of the said spouses’ transactions with the
company. As far as the Court is concerned, the evidence presented shows that
Gorospe, Sr. had no knowledge of the transactions between Dulos Realty and the
spouses Vilbar because it was Juan who executed and signed the documents. More
importantly, the aforementioned Deed of Absolute Sale and Contract to Sell were not
registered and annotated on the original titles in the name of Dulos Realty. Under land
registration laws, the said properties were not encumbered then, and third parties need
only to rely on the face of the duly issued titles. Consequently, the Court finds no bad
faith on Gorospe, Sr.’s part when he bought the properties at public auction free from
liens and encumbrances.
It is worth stressing at this point that bad faith cannot be presumed. "It is a question of
fact that must be proven"83 by clear and convincing evidence. "[T]he burden of
proving bad faith rests on the one alleging it."84 Sadly, spouses Vilbar failed to adduce
the necessary evidence. Thus, this Court finds no error on the part of the CA when it
did not find bad faith on the part of Gorospe, Sr.
Furthermore, the Court recognizes "[t]he settled rule that levy on attachment, duly
registered, takes preference over a prior unregistered sale. This result is a necessary
consequence of the fact that the [properties] involved [were] duly covered by the
Torrens system which works under the fundamental principle that registration is the
operative act which gives validity to the transfer or creates a lien upon the land."85 As
aptly observed by the trial court:
To say the least, there is no reason to doubt that the predecessors-in-interest of the
plaintiff (Opinion) with respect to the said properties, the defendants Gorospes,
likewise acquired the same through lawful means. Indeed, and as acknowledged by
both plaintiff Opinion and defendants Sps. Vilbar, the defendant Dulos Realty
previously owned the above parcels of land under TCT Nos. 39849 and 39850.
However, the said titles were cancelled after the Decision dated 01 April 1982
rendered in favor of defendant Otilio Gorospe, Sr. was implemented or executed.
Consequently, TCT Nos. 117330 and 117331 were issued in the name of defendant
Otilio Gorospe, Sr. Later on, the foregoing titles were cancelled owing to the death of
the wife of defendant Otilio Gorospe, Sr., the late Leonor Gorospe, and TCT Nos.
44796 and 44797 were issued to defendants Gorospes as surviving heirs. These two
titles then became the subject of the mortgage agreement that defendants Gorospes
executed in favor of plaintiff Opinion on 12 January 1995.
The Court notes that when TCT No. 117330 dated 02 June 1987 for Lot 21 in the
name of defendant Otilio Gorospe, Sr. was issued to cancel TCT No. 39850 for the
same lot registered in favor of the defendant Dulos Realty there was no mention
whatsoever that the latter title was already cancelled by TCT No. 36777 supposedly
issued on 22 May 1981 to defendant Bernadette Vilbar. This being so, the subsequent
cancellation of TCT No. 117330 by TCT No. 44796 dated 09 January 1995 for Lot 21
could not be affected by the supposed existence of the title of defendants Spouses
Vilbar.
As to Lot 20, it is also noteworthy that the supposed Deed of Absolute Sale dated 01
June 1981 in favor of defendants Bernadette Vilbar and Guingon was not annotated
on TCT No. 39849. Thus, when this was cancelled by TCT No. 117331 and, later on,
by TCT No. 44797 also dated 09 January 1995, it was not subject to any lien or
encumbrance whatsoever pertaining to the claim of the above defendants over the
same.86 (Emphasis supplied)
In effect, Gorospe, Sr. acquired through lawful means a valid right to the properties,
and he and his son had a legal right to mortgage the same to Opinion. As a
consequence, the Goropes transmitted property rights to Opinion, who, in turn,
acquired valid rights from the Gorospes.
Respondent Opinion is a Buyer in Good Faith.
This Court also treats Opinion as a buyer in good faith. Admittedly, Opinion stated
that prior to the execution of the mortgage, he only went to Lots 20 and 21 once and
saw that the properties had occupants. He likewise admitted that he never talked to the
spouses Vilbar and Guingon to determine the nature of their possession of the
properties, but merely relied on the representation of Gorospe, Sr. that the occupants
were mere tenants. He never bothered to request for any kind of proof, documentary
or otherwise, to confirm this claim. Nevertheless, this Court agrees with the CA that
Opinion is not required to go beyond the Torrens title, viz:
Contrary to the [Spouses Vilbar’s] claim, [Opinion] was never remiss in his duty of
ensuring that the Gorospes had clean title over the property. [Opinion] had even
conducted an investigation. He had, in this regard, no reason not to believe in the
assurance of the Gorospes, more so that the claimed right of [Spouses Vilbar] was
never annotated on the certificate of title covering lot 20, because it is settled that a
party dealing with a registered land does not have to inquire beyond the Certificate of
Title in determining the true owner thereof, and in guarding or protecting his interest,
for all that he has to look into and rely on are the entries in the Certificate of Title.87
Inarguably, Opinion acted in good faith in dealing with the registered owners of the
properties. He relied on the titles presented to him, which were confirmed by the
Registry of Deeds to be authentic, issued in accordance with the law, and without any
liens or encumbrances.88
Besides, assuming arguendo that the Gorospes’ titles to the subject properties
happened to be fraudulent, public policy considers Opinion to still have acquired legal
title as a mortgagee in good faith. As held in Cavite Development Bank v. Spouses
Lim:89
There is, however, a situation where, despite the fact that the mortgagor is not the
owner of the mortgaged property, his title being fraudulent, the mortgage contract and
any foreclosure sale arising therefrom are given effect by reason of public policy. This
is the doctrine of ‘the mortgagee in good faith’ based on the rule that all persons
dealing with property covered by a Torrens Certificate of Title, as buyers or
mortgagees, are not required to go beyond what appears on the face of the title. The
public interest in upholding the indefeasibility of a certificate of title, as evidence of
the lawful ownership of the land or of any encumbrance thereon, protects a buyer or
mortgagee who, in good faith, relied upon what appears on the face of the certificate
of title.90
Respondent Opinion was proven to be in good faith when he dealt with the Gorospes
and relied on the titles presented to him. Spouses Vilbar, on the other hand, failed to
present substantial evidence to prove otherwise.
Proofs of ownership of spouses Vilbar

over Lots 20 and 21 are insufficient to
conclude real ownership, thus, they
cannot be considered as owners of
subject lots.
In support of their claim of ownership, spouses Vilbar presented the following

documentary evidence: (1) Contracts to Sell; (2) Deed of Absolute Sale over Lot 20;
(3) Real Estate Mortgage Agreement with DBP over Lot 21 with reference to the
spouses Vilbar as owners of the said property covered by TCT No. 36777; (4)
Cancellation of Mortgage issued by the DBP in favor of the spouses Vilbar in
connection with Lot 21; (5) various original Official Receipts issued by Dulos Realty
in favor of the spouses Vilbar for installment payments of the purchase price of the
lots in question; (6) various original Official Receipts issued by the DBP in favor of
the spouses Vilbar for payment of loan amortizations; (7) owner’s duplicate copy of
TCT No. 36777 in the name of Bernadette Vilbar; (8) owner’s duplicate copy of TCT
No. S-39849 in the custody of the spouses Vilbar; and, (9) tax declarations and
receipts.
A review of these documents leads the Court to the same inescapable conclusion
reached by the trial court.1âwphi1 With regard to Lot 20, spouses Vilbar brag of a
Deed of Absolute Sale executed by Dulos Realty in their favor and aver that they have
the owner’s copy of TCT No. S-39849 and are presently enjoying actual possession of
said property. However, these are not sufficient proofs of ownership. For some
unknown reasons, the spouses Vilbar did not cause the transfer of the certificate title
in their name, or at the very least, annotate or register such sale in the original title in
the name of Dulos Realty. This, sadly, proved fatal to their cause. Time and time
again, this Court has ruled that "a certificate of title serves as evidence of an
indefeasible and incontrovertible title to the property in favor of the person whose
name appears therein."91 Having no certificate of title issued in their names, spouses
Vilbar have no indefeasible and incontrovertible title over Lot 20 to support their
claim. Further, it is an established rule that "registration is the operative act which
gives validity to the transfer or creates a lien upon the land."92 "Any buyer or
mortgagee of realty covered by a Torrens certificate of title x x x is charged with
notice only of such burdens and claims as are annotated on the title."93 Failing to
annotate the deed for the eventual transfer of title over Lot 20 in their names, the
spouses Vilbar cannot claim a greater right over Opinion, who acquired the property
with clean title in good faith and registered the same in his name by going through the
legally required procedure.
Spouses Vilbar’s possession of the owner’s copy of TCT No. 39849 is of no moment.
It neither cast doubt on Gorospe Sr.’s TCT No. 117331 from which Opinion’s TCT
No. T-59011 covering Lot 20 emanated nor bar Gorospe Sr. from transferring the title
over Lot 20 to his name. It should be recalled that Gorospe Sr. acquired Lots 20 and
21 thru forced sale. Under Section 10794 of Presidential Decree No. 1529,95 Gorospe
Sr. could have the TCTs of said lots cancelled and transferred to his name even if the
previous registered owner (Dulos Realty) refused or neglected to surrender the
owner’s copy thereof. In Valbuena v. Reyes,96 it was held that:
[W]here one acquires a valid deed or title to a property as a result of execution sale,
tax sale, or any sale to enforce a lien, after the expiration of the period, if any, allowed
by law for redemption, when said new owner goes to court and the office of the
register of deeds to have his deed recorded and have a new certificate of title issued in
his name, it is sufficient for purposes of notifying the former owner to surrender his
certificate of title and show cause why it should not be cancelled, that the notification
is effected by mail or by publication as the court may order; and if despite such
notification by mail or by publication, he fails to appear and surrender his certificate
of title, the court may validly order the cancellation of that certificate of title and the
issuance of a new one in favor of the new owner.97
Here, it is clear that Gorospe Sr. was able to secure TCT No. 117331,98 which was
marked as Exhibit "N." Said title explicitly provides that it cancelled TCT No. 39849.
Hence, having been superseded by TCT No. 117331, spouses Vilbar’s possession of
TCT No. 39849 is of no consequence. It may not be amiss to state at this point that
spouses Vilbar’s claim that Dulos Realty conveyed to them Lot 20 on June 1, 1981 is
incongruous with Dulos Realty’s filing of a complaint for reconveyance against
Gorospe Sr. on January 4, 1990. We simply find it difficult to understand why Dulos
Realty would seek recovenyance of Lot 20 from Gorospe Sr. if, indeed, it had already
sold the same almost a decade earlier to spouses Vilbar as evidenced by the latter’s
Deed of Absolute Sale99 dated June 1, 1981. (This complaint docketed as Civil Case
No. 88-2800 though was dismissed for failure to prosecute.)100
With respect to Lot 21, the Court is likewise puzzled as to why spouses Vilbar’s TCT
No. 36777 does not indicate where it came from. The issuance of the said title also
becomes suspect in light of the fact that no Deed of Absolute Sale was ever presented
as basis for the transfer of the title from Dulos Realty. In fact, the spouses Vilbar do
not even know if a Deed of Absolute Sale over Lot 21 was executed in their favor. As
the evidence extant on record stands, only a Contract to Sell which is legally
insufficient to serve as basis for the transfer of title over the property is available. At
most, it affords spouses Vilbar an inchoate right over the property. Absent that
important deed of conveyance over Lot 21 executed between Dulos Realty and the
spouses Vilbar, TCT No. 36777 issued in the name of Bernadette Vilbar cannot be
deemed to have been issued in accordance with the processes required by law. In the
same manner, absent the corresponding inscription or annotation of the required
transfer document in the original title issued in the name of Dulos Realty, third parties
are not charged with notice of said burden and/or claim over the property. The
aforementioned flaws in the title (TCT No. 36777) of spouses Vilbar is aggravated by
the 2nd Indorsement dated May 11, 1988 of the Registry of Deeds of Pasay City
which provides that TCT No. 36777 is presumed not to have been validly issued
considering that no inscription or annotation exists at the back of the original title
(TCT No. S-39850) showing that a deed of sale between Dulos Realty and spouses
Vilbar had been registered, coupled with the established material discrepancies in the
certificate of title in the custody of the Registry of Deeds of Las Piñas City and the
title presented by the spouses Vilbar.
Simply, the spouses Vilbar were not able to present material evidence to prove that
TCT No. 36777 was issued in accordance with the land registration rules.
In addition, the real estate mortgage entered into by the spouses Vilbar with the DBP
does not, by itself, result in a conclusive presumption that they have a valid title to Lot
21. The basic fact remains that there is no proof of conveyance showing how they
acquired ownership over Lot 21 justifying the issuance of the certificate of title in
their name.
With respect to the tax declarations, the trial court aptly declared, thus:
such "indicia" in favor of the defendant Sps. Vilbar had been effectively impugned or
refuted.101
WHEREFORE, the instant Petition for Review on Certiorari is hereby DENIED. The
Decision dated May 26 2006 of he Court of Appeals in CA-G.R CV No. 84409
affirming the Decision dated January 31, 2005 of the Regional Trial Court Branch 255
Las Piñas City in Civil Case No. 98-0302 is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 201405, August 24, 2015
LIWAYWAY ANDRES, RONNIE ANDRES, AND PABLO B.

FRANCISCO, Petitioners, v. STA. LUCIA REALTY & DEVELOPMENT,
INCORPORATED, Respondent.
DECISION
DEL CASTILLO, J.:

Not all may demand for an easement of right-of-way. Under the law, an easement of
right-of-way may only be demanded by the owner of an immovable property or by
any person who by virtue of a real right may cultivate or use the same.
This Petition for Review on Certiorari assails the November 17, 2011 Decision1 of the
Court of Appeals in CA-G.R. CV No. 87715, which reversed and set aside the May
22, 2006 Decision2 of the Regional Trial Court (RTC), Binangonan, Rizal, Branch 68
granting petitioners Pablo B. Francisco (Pablo), Liwayway Andres (Liwayway),
Ronnie Andres (Ronnie) and their co-plaintiff Liza Andres (Liza) a 50-square meter
right-of-way within the subdivision of respondent Sta. Lucia Realty and Development,
Incorporated (respondent).
Likewise assailed is the March 27, 2012 CA Resolution3 which denied petitioners and
Liza's Motion for Reconsideration thereto.
Factual Antecedents
Petitioners and Liza filed a Complaint4 for Easement of Right-of-Way against

respondent before the RTC on November 28,2000. They alleged that they are
co-owners and possessors for more than 50 years of three parcels of unregistered
agricultural land in Pag-asa, Binangonan, Rizal with a total area of more or less
10,500 square meters (subject property). A few years back, however, respondent
acquired the lands surrounding the subject property, developed the same into a
residential subdivision known as the Binangonan Metropolis East, and built a
concrete perimeter fence around it such that petitioners and Liza were denied
access from subject property to the nearest public road and vice versa. They thus
prayed for a right-of-way within Binangonan Metropolis East in order for them to
have access to Col. Guido Street, a public road.
In its Answer,5 respondent denied knowledge of any property adjoining its

subdivision owned by petitioners and Liza. At any rate, it pointed out that
petitioners and Liza failed to sufficiently allege in their complaint the existence of
the requisites for the grant of an easement of right-of-way.
During trial, Pablo testified that he bought a 4,000-square meter-portion of the

subject property from Carlos Andres (Carlos), the husband of Liwayway and father
of Ronnie and Liza.6 According to Pablo, he and his co-plaintiffs are still in
possession of the subject property as evidenced by an April 13, 1998
Certification7 issued by the Barangay Chairman of Pag-asa.8 Further, Pablo
clarified that the easement of right-of-way that they are asking from respondent
would traverse the latter's subdivision for about 50 meters from the subject
property all the way to another subdivision that he co-owns, Victoria Village,
which in turn, leads to Col. Guido Street.9 He claimed that the prevailing market
value of lands in the area is about P600.00 per square meter. Pablo also explained that
the subject property is still not registered under the Land Registration Act since
no tax declaration over the same has been issued to them despite application with
the Municipal Assessor of Binangonan.10 When required by the court to submit
documents regarding the said application,11 Pablo attached in his
Compliance,12 among others, Carlos' letter13 of Maty 18, 1998 to the Municipal
Assessor of Binangonan requesting for the issuance of a tax declaration and the reply
thereto dated August 5, 199814 of the Provincial Assessor of Rizal. In the aforesaid
reply, the Provincial Assessor denied the request on the ground that the subject
property was already declared for taxation purposes under the name of Juan
Diaz and later, in the name of Juanito15Blanco, et al. (the Blancos).
Liwayway testified next. According to her, she and her children Ronnie and Liza are
the surviving heirs of the late Carlos who owned the subject property.16 Carlos
acquired ownership over the same after he had been in continuous, public and
peaceful possession thereof for 50 years,17 the circumstances of which he narrated in
a Sinumpaang Salaysay18 that he executed while he was still alive. Carlos stated
therein that even before he was born in 1939, his father was already in possession and
working on the subject property; that in 1948, he started to help his father in tilling the
land; that when his father became weak and eventually died, he took over the land;
and, that he already sought to register his ownership of the property with the
Department of Environment and Natural Resources (DENR) and to declare the same
for taxation purposes.
For its part, respondent presented as a lone witness the then Municipal Assessor
of Binangonan, Virgilio Flordeliza (Flordeliza). Flordeliza confirmed that Carlos
wrote him a letter-request for the issuance of a tax declaration.19 He, however,
referred the matter to the Provincial Assessor of Rizal since the property for
which the tax declaration was being applied for was already declared for
taxation purposes in the name of one Juan Diaz.20 Later, the tax declaration of
Juan Diaz was cancelled and in lieu thereof, a tax declaration in the name of the
Blancos was issued.21 For this reason, the Provincial Assessor of Rizal denied
Carlos' application for issuance of tax declaration.22cralawrednad
The RTC rendered its Decision23 on May 22, 2006. It observed that petitioners and
Liza's allegation in their Complaint that they were in possession of the subject
property for more than 50 years was not denied by respondent in its Answer.
Thus, the same is deemed to have been impliedly admitted by the latter. It then
ratiocinated that based on Article 113724 of the Civil Code, petitioners and Liza
are considered owners of the subject property through extraordinary
prescription. Having real right over the same, therefore, they are entitled to
demand an easement of right-of-way under Article 64925cralawred of the Civil
Code.
The RTC further held that Pablo's testimony sufficiently established: (1) that the
subject property was surrounded by respondent's property; (2) the area and
location of the right-of-way sought; (3) the value of the land on which the
right-of-way is to be constituted which was P600.00 per square meter; and (4)
petitioners and Liza's possession of the subject property up to the present time.
In the ultimate, said court concluded that petitioners and Liza are entitled to an
easement of right-of-way, thus:cralawlawlibrary
WHEREFORE, judgment is hereby rendered giving the plaintiffs a

right of way of 50 square meters to reach Victoria Village towards Col.
Guido Street. Defendant Sta. Lucia is hereby ordered to grant the right
of way to the plaintiffs as previously described upon payment of an
indemnity equivalent to the market value of the [50-square meter right
of way].
SO ORDERED.26
Respondent filed a Notice of Appeal27 which was given due course by the RTC in an
Order28 dated June 27, 2006.
On appeal, respondent argued mat petitioners and Liza were neither able to prove
that they were owners nor that they have any real right over the subject property
intended to be the dominant estate. Hence, they are not entitled to demand an
easement of right-of-way. At any rate, they likewise failed to establish that the
only route available from their property to Col. Guido Street is through
respondent's subdivision.
In a Decision29 dated November 17, 2011, the CA held that the evidence adduced by
petitioners and Liza failed to sufficiently establish their asserted ownership and
possession of the subject property. Moreover, it held that contrary to the RTC's
observation, respondent in fact denied in its Answer the allegation of petitioners
and Liza that they have been in possession of subject property for more than 50 years.
In view of these, the CA concluded that petitioners and Liza have no right to demand
an easement of right-of-way from respondent, thus:cralawlawlibrary
WHEREFORE, in view of the foregoing, the appeal is hereby
GRANTED. Accordingly, the May 22, 2006 Decision of the Regional
Trial Court of Binangonan, Rizal, Branch 68 is REVERSED and SET
ASIDE. Civil Case No. 00-037-B is ordered DISMISSED.
SO ORDERED.30
Petitioners and Liza's Motion for Reconsideration31 was denied in the CA
Resolution32 dated March 27, 2012.
Hence, petitioners seek recourse to this Court through this Petition for Review
on Certiorari.
Issue
Whether petitioners are entitled to demand an easement of right-of-way from

respondent.
Our Ruling
The Petition has no merit.
Under Article 649 of the Civil Code, an easement of right-of-way may be demanded
by the owner of an immovable or by any person who by virtue of a real right may
cultivate or use the same.
Here, petitioners argue that they are entitled to demand an easement of right-of-way
from respondent because they are the owners of the subject property intended to be
the dominant estate. They contend that they have already acquired ownership of the
subject property through ordinary acquisitive prescription.33 This is considering that
their possession became adverse as against the Blancos (under whose names the
subject property is declared for taxation) when Carlos formally registered his claim of
ownership with the DENR and sought to declare the subject property for taxation
purposes in 1998. And since more than 10 years34 had lapsed from that time without
the Blancos doing anything to contest their continued possession of the subject
property, petitioners aver that ordinary acquisitive prescription had already set in their
favor and against the Blancos.
In the alternative, petitioners assert that they have already become owners of the
subject property through extraordinary acquisitive prescription since (1) they have
been in open, continuous and peaceful possession thereof for more than 50 years; (2)
the subject property, as depicted in the Survey Plan they caused to be prepared is
alienable and disposable; (3) Carlos filed a claim of ownership over the property with
the DENR, the agency charged with the administration of alienable public land; and
(4) Carlos' manifestation of willingness to declare the property for taxation purposes
not only had the effect of giving notice of his adverse claim on the property but also
strengthened his bona fide claim of ownership over the same.
It must be stressed at the outset that contrary to petitioners' allegations, there is no

showing that Carlos filed a claim of ownership over the subject property with the
DENR. His April 13, 1998 letter35 to the said office which petitioners assert to be an
application for the registration of such claim is actually just a request for the issuance
of certain documents and nothing more. Moreover, while Carlos indeed attempted to
declare the subject property for taxation purposes, his application, as previously
mentioned, was denied because a tax declaration was already issued to the Blancos.
Anent petitioners' invocation of ordinary acquisitive prescription, the Court notes that
the same was raised for the first time on appeal. Before the RTC, petitioners based
their claim of ownership on extraordinary acquisitive prescription under Article 1137
of the Civil Code36 such that the said court declared them owners of the subject
property by virtue thereof in its May 22, 2006 Decision.37 Also with the CA,
petitioners initially asserted ownership through extraordinary acquisitive
prescription.38 It was only later in their Motion for Reconsideration39 therein that they
averred that their ownership could also be based on ordinary acquisitive
prescription.40 "Settled is the rule that points of law, theories, issues and arguments
not brought to the attention of the lower court need not be considered by a reviewing
court, as they cannot be raised for the first time at that late stage. Basic considerations
of fairness and due process impel this rule."41cralawrednad
Even if timely raised, such argument of petitioners, as well as with respect to

extraordinary acquisitive prescription, fails. "Prescription is one of the modes of
acquiring ownership under the Civil Code."42 There are two modes of prescription
through which immovables may be acquired - ordinary acquisitive prescription which
requires possession in good faith and just title for 10 years and, extraordinary
prescription wherein ownership and other real rights over immovable property are
acquired through uninterrupted adverse possession for 30 years without need of title
or of good faith.43 However, it was clarified in the Heirs of Mario Malabanan v.
Republic of the Philippines,44 that only lands of the public domain subsequently
classified or declared as no longer intended for public use or for the development of
national wealth, or removed from the sphere of public dominion and are considered
converted into patrimonial lands or lands of private ownership, may be alienated or
disposed through any of the modes of acquiring ownership under the Civil
Code.45 And if the mode of acquisition is prescription, whether ordinary or
extraordinary, it must first be shown that the land has already been converted to
private ownership prior to the requisite acquisitive prescriptive period. Otherwise,
Article 1113 of the Civil Code, which provides that property of the State not
patrimonial in character shall not be the subject of prescription,
applies.46cralawrednad
Sifting through petitioners' allegations, it appears that the subject property is an

unregistered public agricultural land. Thus, being a land of the public domain,
petitioners, in order to validly claim acquisition thereof through prescription, must
first be able to show that the State has -
expressly declared through either a law enacted by Congress or a
proclamation issued by the President that the subject [property] is no
longer retained for public service or the development of the national
wealth or that the property has been converted into patrimonial.
Consequently, without an express declaration by the State, the land
remains to be a property of public dominion and hence, not susceptible
to acquisition by virtue of prescription.47
In the absence of such proof of declaration in this case, petitioners' claim of
ownership over the subject property based on prescription necessarily crumbles.
Conversely, they cannot demand an easement of right-of-way from respondent for
lack of personality.
All told, the Court finds no error on the part of the CA in reversing and setting aside
the May 22, 2006 Decision of the RTC and in ordering the dismissal of petitioners'
Complaint for Easement of Right-of-Way against respondent.
WHEREFORE, the Petition is DENIED. The November 17, 2011 Decision and
March 27, 2014 Resolution of the Court of Appeals in CA-G.R. CV No. 87715
are AFFIRMED.
SO ORDERED.chanrobles virtuallawlibrary
LTD

Supreme Court
Manila
FIRST DIVISION
ASUNCION URIETA VDA. DE G.R. No. 164402

AGUILAR, represented by
ORLANDO U. AGUILAR, Present:
Petitioner,
CORONA, C. J., Chairperson,
VELASCO, JR.,
- versus - LEONARDO-DE CASTRO,
DEL CASTILLO, and
PEREZ, JJ.
SPOUSES EDERLINA B. ALFARO
and RAUL ALFARO, Promulgated:
Respondents. July 5, 2010
x------------------------------------------------------------------
-x
DECISION
DEL CASTILLO, J.:

In an action for recovery of possession of realty, who has the better right of possession, the
registered owner armed with a Torrens title or the occupants brandishing a notarized but
unregistered deed of sale executed before the land was registered under the Torrens system?
As we previously ruled in similar cases,[1] we resolve the question in favor of the
titleholder.
Factual Antecedents
On August 3, 1995, petitioner filed a Complaint for Recovery of Possession and

Damages[2] before the Regional Trial Court (RTC) of San Jose, Occidental Mindoro. She
alleged that on May 16, 1977, her husband Ignacio Aguilar (Ignacio) was issued Original
Certificate of Title (OCT) No. P-9354[3] over a 606-square meter parcel of land designated
as Lot 83 situated in Brgy. Buenavista, Sablayan, Occidental Mindoro. Prior thereto, or in
1968, Ignacio allowed petitioners sister, Anastacia Urieta (Anastacia), mother of respondent
Ederlina B. Alfaro (Ederlina), to construct a house on the southern portion of said land and to
stay therein temporarily.
In 1994, Ignacio died and his heirs decided to partition Lot 83. Petitioner thus asked the
respondents, who took possession of the premises after the death of Anastacia, to
vacate Lot 83. They did not heed her demand.
Thus, petitioner filed a case for accion publiciana praying that respondents be ordered to
vacate subject property, and to pay moral, temperate, and exemplary damages, as well as
attorneys fees and the costs of suit.
In their Answer with Counterclaims and Affirmative Defenses,[4] respondents did not
dispute that Ignacio was able to secure title over the entire Lot 83. However, they asserted that
on April 17, 1973, Ignacio and herein petitioner sold to their mother Anastacia the southern
portion of Lot 83 consisting of 367.5 square meters as shown by the Kasulatan sa
Bilihan[5] which bears the signatures of petitioner and Ignacio. Since then, they and their
mother have been in possession thereof. Respondents also presented several Tax
Declarations[6] in support of their allegations.
Respondents also raised the defense of prescription. They pointed out that accion
publiciana or an action to recover the real right of possession independent of ownership
prescribes in 10 years. However, it took petitioner more than 25 years before she asserted her
rights by filing accion publiciana. As alleged in the complaint, they took possession of the
disputed portion of Lot 83 as early as 1968, but petitioner filed the case only in 1995.
By way of counterclaim, respondents prayed that petitioner be directed to execute the
necessary documents so that title to the 367.5-square meter portion of Lot 83 could be issued
in their name. They likewise prayed for the dismissal of the complaint and for award of moral
and exemplary damages, as well as attorneys fees.
In her Reply and Answer to Counterclaim,[7] petitioner denied having signed

the Kasulatan sa Bilihan and averred that her signature appearing thereon is a forgery. She
presented an unsworn written declaration dated January 28, 1994 where her husband declared
that he did not sell the property in question to anyone. As to the issue of prescription, she
asserted that respondents occupation of subject property cannot ripen into ownership
considering that the same is by mere tolerance of the owner. Besides, the purported Kasulatan
sa Bilihan was not registered with the proper Registry of Deeds.
During the trial, petitioner presented the testimonies of Orlando Aguilar (Orlando)
and Zenaida Baldeo (Zenaida). Orlando testified that he has been staying in Lot 83 since 1960
and had built a house thereon where he is presently residing; and, that his mother, herein
petitioner, denied having sold the property or having signed any document for that matter.
Zenaida also testified that in 1981, her father (Ignacio) and Ederlina had a
confrontation before the barangay during which her father denied having conveyed any
portion of Lot 83 to anybody. She further testified that she is familiar with the signature of her
father and that the signature appearing on the Kasulatan sa Bilihan is not her fathers
signature.
For their part, respondents offered in evidence the testimonies of Estrella Bermudo
Alfaro (Estrella), Ederlina, and Jose Tampolino (Jose). Estrella declared that she was present
when Ignacio and the petitioner affixed their signatures on the Kasulatan sa Bilihan, which
was acknowledged before Notary Public Juan Q. Dantayana on April 17, 1973. She narrated
that her mother actually purchased the property in 1954, but it was only in 1973 when the
vendor executed the deed of sale. In fact, her father Francisco Bermudo was able to secure a
permit to erect a house on the disputed property from the Office of the Mayor of Sablayan,
Occidental Mindoro in 1954.[8] She was surprised to learn though that their property is still
registered in the name of the petitioner.
Ederlina corroborated the declarations of Estrella. She also alleged that her parents
occupied the property in 1954 when they built a hut there, then later on, a house of strong
materials.
Jose corroborated the declarations of the other witnesses for the respondents that the
disputed portion of Lot 83 is owned by Anastacia.
In its Decision[9] dated September 21, 1998, the court a quo ordered the respondents
to vacate subject premises and denied their counterclaim for reconveyance on the grounds of
prescription and laches. It held that the prescriptive period for reconvenyance of fraudulently
registered real property is 10 years reckoned from the date of the issuance of the certificate of
title.In this case, however, it is not disputed that OCT No. P-9354 covering the entire Lot 83
was issued to Ignacio in 1977. The trial court likewise held that respondents are guilty of
laches and that the reconveyance of the disputed property in their favor would violate the rule
on indefeasibility of Torrens title.
The dispositive portion of the trial courts Decision reads:
WHEREFORE, and in the light of all the foregoing considerations,

judgment is hereby rendered in favor of plaintiff and against the defendants,
to wit:
1. Ordering the defendants and any person claiming right under them
to vacate the premises in question and surrender the possession thereof to
plaintiff;
2. To pay the amount of Ten Thousand Pesos (P10,000.00) as and for

reasonable attorneys fees;
3. To pay the costs of this suit.
SO ORDERED.[10]
On June 7, 2004, the CA promulgated its Decision[11] reversing the trial courts
Decision and dismissing the complaint, as well as respondents counterclaim. The CA upheld
the validity of the Kasulatan sa Bilihan since it is a notarized document and disputably
presumed to be authentic and duly executed. In addition, witness Estrella categorically
declared that she was present when petitioner and Ignacio signed the Kasulatan sa
Bilihan. The CA elaborated that in order to disprove the presumption accorded to a notarized
document, the party contesting its authenticity and due execution must present a clear and
convincing evidence to the contrary, which the petitioner failed to do.
The CA likewise disagreed with the court a quo that respondents counterclaim should
be dismissed on the ground of indefeasibility of title. It emphasized that the Torrens system
was adopted to protect innocent third parties for value and not to protect fraud. Nonetheless,
the CA did not grant the relief sought in respondents counterclaim considering that not all
interested parties were impleaded in the case.
The dispositive portion of the CAs Decision reads:
IN VIEW OF THE FOREGOING, the decision appealed from is

REVERSED, and a new one ENTERED dismissing the complaint and
counterclaim.
SO ORDERED.[12]
Issue
Without seeking reconsideration of the CAs Decision, petitioner interposed the

present recourse raising the sole issue of:
WHETHER X X X THE HONORABLE COURT OF APPEALS ERRED

IN UPHOLDING THE VALIDITY/GENUINENESS AND DUE
EXECUTION OF THE PURPORTED DEED OF SALE OF THE
PORTION OF THE LOT DESPITE THE VEHEMENT DENIAL OF THE
ALLEGED VENDORS.[13]
Petitioner contends that the CA grievously erred in upholding the validity and
genuineness of the Kasulatan sa Bilihan. She alleges that she wanted to take the witness stand
to disclaim in open court her purported signature appearing on respondents Kasulatan sa
Bilihan, but could not do so because she is too old, bed-ridden and has to bear a tortuous
five-hour drive to reach the court. Nevertheless, she executed a sworn statement declaring that
she and her husband never sold any portion of Lot 83 and that their signatures appearing on
said deed were forged. She avers that the assistance of an expert witness is not even necessary
to detect the patent dissimilarities between said forged signatures and their authentic
signatures.
Petitioner likewise argues that the CA erred in taking into consideration the
appearance and condition of the paper where the Kasulatan sa Bilihan is written. She posits
that the fabrication of an ancient-looking document nowadays is no longer difficult. She also
points to several circumstances which cast doubt on the authenticity and due execution of
the Kasulatan sa Bilihan, but which the CA inexplicably ignored
Furthermore, petitioner maintains that her title is indefeasible. And while there are
exceptions to the rule on indefeasibility of title,[14] she emphasizes that respondents never
disputed her title. With regard to the tax declarations presented by respondents, petitioner
asserts that it has been the consistent ruling of this Court that tax declarations are not
necessarily proof of ownership.
In their comment, respondents assert that in petitions filed under Rule 45 of the Rules
of Court, only questions of law can be raised. Factual issues are prohibited. From the
arguments advanced by the petitioner, however, it is clear that she is asking this Court to
examine and weigh again the evidence on record.
Our Ruling
We grant the petition.
This case falls under the exceptions where

the Supreme Court may review factual
issues.
As a rule, only questions of law may be raised in petitions for review

on certiorari.[15] It is settled that in the exercise of the Supreme Courts power of review, the
court is not a trier of facts and does not normally undertake the re-examination of the
evidence presented by the contending parties during the trial of the case.[16] This rule, however,
is subject to a number of exceptions,[17] one of which is when the findings of the appellate
court are contrary to those of the trial court, like in the present case.
Nature and purpose of accion publiciana.
Also known as accion plenaria de posesion,[18] accion publiciana is an

ordinary civil proceeding to determine the better right of possession of realty independently of
title.[19] It refers to an ejectment suit filed after the expiration of one year from the accrual of
the cause of action or from the unlawful withholding of possession of the realty.[20]
The objective of the plaintiffs in accion publiciana is to recover possession only, not
ownership.[21] However, where the parties raise the issue of ownership, the courts may pass
upon the issue to determine who between the parties has the right to possess the
property. This adjudication, however, is not a final and binding determination of the issue of
ownership; it is only for the purpose of resolving the issue of possession, where the issue of
ownership is inseparably linked to the issue of possession. The adjudication of the issue of
ownership, being provisional, is not a bar to an action between the same parties involving title
to the property.[22] The adjudication, in short, is not conclusive on the issue of ownership.[23]
Guided by the foregoing jurisprudential guideposts, we shall now resolve the

arguments raised by the parties in this petition.
As against petitioners Torrens title,

respondents Kasulatan sa Bilihan cannot
confer better right to possess.
It is settled that a Torrens title is evidence of indefeasible title to property in favor of

the person in whose name the title appears.[24] It is conclusive evidence with respect to the
ownership of the land described therein.[25] It is also settled that the titleholder is entitled to all
the attributes of ownership of the property, including possession.[26] Thus, in Arambulo v.
Gungab,[27] this Court declared that the age-old rule is that the person who has a Torrens title
over a land is entitled to possession thereof.
In the present case, there is no dispute that petitioner is the holder of a Torrens title
over the entire Lot 83. Respondents have only their notarized but unregistered Kasulatan sa
Bilihan to support their claim of ownership. Thus, even if respondents proof of ownership has
in its favor a juris tantum presumption of authenticity and due execution, the same cannot
prevail over petitioners Torrens title. This has been our consistent ruling which we recently
reiterated in Pascual v. Coronel,[28] viz:
Even if we sustain the petitioners arguments and rule that the deeds
of sale are valid contracts, it would still not bolster the petitioners case. In a
number of cases, the Court had upheld the registered owners superior right to
possess the property. In Co v. Militar, the Court was confronted with a
similar issue of which between the certificate of title and an unregistered deed
of sale should be given more probative weight in resolving the issue of who
has the better right to possess. There, the Court held that the court a
quo correctly relied on the transfer certificate of title in the name of petitioner,
as opposed to the unregistered title in the name of respondents. The Court
stressed therein that the Torrens System was adopted in this country because
it was believed to be the most effective measure to guarantee the integrity of
land titles and to protect their indefeasibility once the claim of ownership is
established and recognized.
Likewise, in the recent case of Umpoc v. Mercado, the Court

declared that the trial court did not err in giving more probative weight to the
TCT in the name of the decedent vis--vis the contested unregistered Deed of
Sale. Later in Arambulo v. Gungab, the Court held that the registered owner
is preferred to possess the property subject of the unlawful detainer case. The
age-old rule is that the person who has a Torrens Title over a land is entitled
to possession thereof. (Citations omitted.)
As the titleholder, therefore, petitioner is preferred to possess the

entire Lot 83. Besides, there are telltale signs which cast doubt on the genuineness of
the Kasulatan. To cite a few:
1. The date of its execution unbelievably coincides with the date the buyer,
Anastacia, died;
2. Despite its alleged execution on April 17, 1973, respondents brought up

the Kasulatan only when petitioner asked them to vacate the disputed
premises. Prior thereto, they neither asserted their rights thereunder nor registered
the same with the proper Registry of Deeds;
3. The lawyer who notarized the Kasulatan sa Bilihan, as well as the witnesses
thereto, was not presented in court; and,
4. The District Land Officer who signed OCT No. P-9354 by authority of the
President is a public officer who has in his favor the presumption of regularity in
issuing said title.
Torrens certificate of title cannot be the

subject of collateral attack.
Moreover, respondents attack on the validity of petitioners title by claiming that their
mother became the true owner of the southern portion of Lot 83 even before the issuance of
OCT No. P-9354 constitutes as a collateral attack on said title. It is an attack incidental to their
quest to defend their possession of the property in an accion publiciana, not in a direct action
whose main objective is to impugn the validity of the judgment granting the title.[29] This
cannot be allowed. Under Section 48 of Presidential Decree No. 1529, otherwise known as
the Property Registration Decree, a certificate of title cannot be the subject of collateral
attack. Thus:
SEC. 48. Certificate not subject to collateral attack. A certificate of

title shall not be subject to collateral attack. It cannot be altered, modified, or
canceled except in a direct proceeding in accordance with law.
A collateral attack transpires when, in another action to obtain a different relief and as
an incident to the present action, an attack is made against the judgment granting the
title.[30] This manner of attack is to be distinguished from a direct attack against a judgment
granting the title, through an action whose main objective is to annul, set aside, or enjoin the
enforcement of such judgment if not yet implemented, or to seek recovery if the property
titled under the judgment had been disposed of.[31] Thus, in Magay v. Estiandan,[32] therein
plaintiff-appellee filed an accion publiciana. In his defense, defendant-appellant alleged
among others that plaintiff-appellees Transfer Certificate of Title No. 2004 was issued under
anomalous circumstances. When the case reached this Court, we rejected
defendant-appellants defense on the ground that the issue on the validity of said title can only
be raised in an action expressly instituted for that purpose.Also, in Co v. Court of
Appeals[33] we arrived at the same conclusion and elaborated as follows:
In their reply dated September 1990, petitioners argue that the issues
of fraud and ownership raised in their so-called compulsory counterclaim
partake of the nature of an independent complaint which they may pursue for
the purpose of assailing the validity of the transfer certificate of title of private
respondents. That theory will not prosper.
While a counterclaim may be filed with a subject matter or for a

relief different from those in the basic complaint in the case, it does not
follow that such counterclaim is in the nature of a separate and independent
action in itself. In fact, its allowance in the action is subject to explicit
conditions, as above set forth, particularly in its required relation to the
subject matter of opposing partys claim. Failing in that respect, it cannot even
be filed and pursued as an altogether different and original action.
It is evident that the objective of such claim is to nullify the title of

private respondents to the property in question, which thereby challenges the
judgment pursuant to which the title was decreed. This is apparently a
collateral attack which is not permitted under the principle of indefeasibility
of a Torrens title. It is well settled that a Torrens title cannot be collaterally
attacked. The issue on the validity of title, i.e., whether or not it was
fraudulently issued, can only be raised in an action expressly instituted for
that purpose. Hence, whether or not petitioners have the right to claim
ownership of the land in question is beyond the province of the instant
proceeding. That should be threshed out in a proper action.
The lower courts cannot pass upon or grant

respondents counterclaim for lack of
jurisdiction.
Both the trial court and the appellate court considered respondents counterclaim as a
petition for reconveyance. In which case, it should be treated merely as a permissive
counterclaim because the evidence required to prove their claim differs from the evidence
needed to establish petitioners demand for recovery of possession. Being a permissive
counterclaim, therefore, respondents should have paid the corresponding docket
fees.[34] However, there is no proof on record that respondents paid the required docket
fees. The official receipts were neither attached to nor annotated on respondents Answer with
Counterclaims and Affirmative Defenses[35] which was filed via registered mail[36] on August
19, 1995. It has been our consistent ruling that it is not simply the filing of the complaint or
appropriate initiatory pleading, but the payment of the full amount of the prescribed docket
fee, that vests a trial court with jurisdiction over the subject matter or nature of the
action.[37] The same rule applies to permissive counterclaims, third-party claims and similar
pleadings, which shall not be considered filed until and unless the filing fee prescribed
therefor is paid.[38]
On a final note, and as discussed above, we stress that our ruling in this case is limited
only to the issue of determining who between the parties has a better right to possession. This
adjudication is not a final and binding determination of the issue of ownership. As such, this is
not a bar for the parties to file an action for the determination of the issue of ownership where
the validity of the Kasulatan sa Bilihan and of OCT No. P-9354 can be properly threshed out.
WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of

Appeals dated June 7, 2004 is REVERSED and SET ASIDE and the September 21, 1998
Decision of Regional Trial Court, Branch 46, San Jose, Occidental Mindoro, insofar as it
orders the respondents to vacate the premises is REINSTATED and AFFIRMED.
SO ORDERED.

Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
Chairperson
PRESBITERO J. VELASCO, JR. TERESITA J. LEONARDO-DE CASTRO

Associate Justice Associate Justice
JOSE PORTUGAL PEREZ

Associate Justice
CERTIFICATION
RENATO C. CORONA
Chief Justice
[1]
Co v. Militar, 466 Phil. 217 (2004); Umpoc v. Mercado, 490 Phil. 118; Arambulo v.
Gungab, G.R. No. 156581, September 30, 2005, 471 SCRA 640; Pascual v.
Coronel, G.R. No. 159292, July 12, 2007, 527 SCRA 474.
[2]
Records, pp. 1-4. The case was raffled to Branch 46 and docketed as Civil Case No.
R-924.
[3]
Id. at 5.
[4]
Id. at 12-16.
[5]
Id. at 128.
[6]
Id. at 129-138.
[7]
Id. at 21-24.
[8]
Id. at 139.
[9]
Id. at 153-161; penned by Judge Ernesto P. Pagayatan.
[10]
Id. at 161.
[11]
CA rollo, pp. 82-89; penned by Associate Justice Mario L. Guaria III and
concurred in by Associate Justices Rodrigo V. Cosico and Santiago Javier
Ranada.
[12]
Id. at 89.
[13]
Rollo, p. 201.
[14]
Such as when a land in possession of a rightful possessor in the concept of owner
is fraudulently registered in the name of another.
[15]
RULES OF COURT, Rule 45, Section 1.
[16]
Santos v. Lumbao, G.R. No. 169129, March 28, 2007, 519 SCRA 408, 420.
[17]
The recognized exceptions are: (1) when the inference made is manifestly
mistaken, absurd or impossible; (2) when there is a grave abuse of discretion; (3)
when the finding is grounded entirely on speculations, surmises or conjectures; (4)
when the judgment of the CA is based on misapprehension of facts; (5) when the
findings of fact are conflicting; (6) when the CA, in making its findings, went
beyond the issues of the case and the same [are] contrary to the admissions of both
parties; (7) when the findings of the CA are contrary to those of the trial court; (8)
when the findings of fact are conclusions without citation of specific evidence on
which they are based; (9) when the CA manifestly overlooked certain relevant
facts not disputed by the parties and which, if properly considered, would justify a
different conclusion; and (10) when the findings of fact of the CA are premised on
the absence of evidence and are contradicted by the evidence on record. (Sering v.
Court of Appeals, 422 Phil. 467, 471-472; Fuentes v. Court of Appeals, 335 Phil.
1163, 1168 (1997)).
[18]
Bejar v. Caluag, G.R. No. 171277, February 17, 2007, 516 SCRA 84, 90; Barredo
v. Santiago, 102 Phil. 127, 130 (1957).
[19]
Bejar v. Caluag, id.; Sps. Cruz v. Torres, 374 Phil. 529, 533 (1999); Bishop
of Cebu v. Mangaron, 6 Phil. 286, 291 (1906); Ledesma v. Marcos, 9 Phil. 618,
620 (1908).
[20]
Encarnacion v. Amigo, G.R. No. 169793, September 15, 2006, 502 SCRA 172,
179; Lopez v. David, Jr., G.R. No. 152145, March 30, 2004, 426 SCRA 535, 543.
[21]
Natalia Realty, Inc. v. Court of Appeals, 440 Phil. 1, 25 (2002).
[22]
Rivera v. Rivera, 453 Phil. 404, 412 (2003).
[23]
Umpoc v. Mercado, 490 Phil. 118, 136 (2005).
[24]
See Baloloy v. Hular, 481 Phil. 398, 410 (2004).
[25]
Carvajal v. Court of Appeals, 345 Phil. 582, 594 (1997).
[26]
Supra note 24.
[27]
G.R. No. 156581, September 30, 2005, 471 SCRA 648.
[28]
G.R. No. 159292, July 12, 2007, 527 SCRA 474, 484-485.
[29]
Ugale v. Gorospe, G.R. No. 149516, September 11, 2006, 501 SCRA 376,
386; Caraan v. Court of Appeals, G.R. No. 140752, November 11, 2005, 474
SCRA 543, 550; Baloloy v. Hular, 481 Phil. 398, 410 (2004) and CIVIL CODE,
Article 428.
[30]
Teoville Homeowners Association, Inc. v. Ferreira, G.R. No. 140086, June 8,
2005, 459 SCRA 459, 474.
[31]
Id.
[32]
161 Phil. 586, 587 (1976).
[33]
274 Phil. 108, 116 (1991).
[34]
See Alday v. FGU Insurance Corporation, 402 Phil. 962 (2001).
[35]
Records, pp. 12-16.
[36]
Id. at 20.
[37]
Sun Insurance Office v. Asuncion, 252 Phil. 280, 291 (1989).
[38]
Id.
G.R. No. 202805, March 23, 2015
ROSARIO BANGUIS-TAMBUYAT, Petitioner, v. WENIFREDA

BALCOM-TAMBUYAT, Respondent.
DECISION
DEL CASTILLO, J.:
This Petition for Review on Certiorari1 seeks to set aside the February 14, 2012
Decision2 of the Court of Appeals (CA) in CA-G.R. CV No. 84954 affirming with
modification the May 26, 2003 Decision3 of the Regional Trial Court of Malolos,
Bulacan, Branch 10 in LRC Case No. P-443-99, as well as its July 26, 2012
Resolution4 denying petitioner’s Motion for Reconsideration5 of the herein assailed
judgment.
Factual Antecedents
Adriano M. Tambuyat (Adriano) and respondent Wenifreda Balcom-Tambuyat

(Wenifreda) were married on September 16, 1965.6 During their marriage,
Adriano acquired several real properties, including a 700-square meter parcel of
land located at Barangay Muzon, San Jose del Monte, Bulacan (the subject
property),7 which was bought on November 17, 1991.8 The deed of sale over the
said property was signed by Adriano alone as vendee; one of the signing
witnesses to the deed of sale was petitioner Rosario Banguis-Tambuyat (Banguis),
who signed therein as “Rosario Banguis.”9 When Transfer Certificate of Title No.
T-145321(M) (TCT T-145321) covering the subject property was issued, however, it
was made under the name of “ADRIANO M. TAMBUYAT married to
ROSARIO E. BANGUIS.”10
All this time, petitioner Banguis remained married to Eduardo Nolasco (Nolasco).
They were married on October 15, 1975, and at all times material to this case,
Nolasco was alive, and his marriage to petitioner subsisted and was never
annulled.11
On June 7, 1998, Adriano died intestate.12
On October 18, 1999, Wenifreda filed a Petition for Cancellation13 of TCT

T-145321, which was docketed as LRC Case No. P-443-99 and assigned to Branch 10
of the Regional Trial Court of Malolos, Bulacan (Malolos RTC). She alleged therein
that she was the surviving spouse of Adriano; that TCT T-145321 was
erroneously registered and made in the name of “ADRIANO M. TAMBUYAT
married to ROSARIO E. BANGUIS;” that per annexed Marriage Contract,
Banguis was still married to Nolasco; that Banguis could not have been married
to Adriano; that the issuance of the title in Banguis’s name as Adriano’s spouse was
due to “an insidious machination by her and the person who brokered the sale of the
subject property, allegedly a cousin or relative of hers;”14 and that consequently, she
suffered damages. Thus, Wenifreda prayed that TCT T-145321 be cancelled; that a
new certificate of title be made out in Adriano’s name, with her as the spouse
indicated; that Banguis be ordered to surrender her copy of TCT T-145321; and that
moral and exemplary damages, attorney’s fees, and costs of litigation be adjudged in
her favor.
In her Opposition15 to the petition for cancellation, Banguis denied specifically that
the subject property was acquired by Adriano and Wenifreda during their
marriage. She claimed that on the other hand, she alone bought the subject
property using her personal funds; that she and Adriano were married on
September 2, 1988 and thereafter lived together as a married couple; that their
union produced a son, who was born on April 1, 1990; that the trial court has no
jurisdiction over the petition for cancellation, which is merely a summary proceeding
– considering that a thorough determination will have to be made as to whether the
property is conjugal or exclusive property, and since she and Adriano have a child
whose rights will be adversely affected by any judgment in the case; and that
Wenifreda is guilty of forum-shopping in filing LRC Case No. P-443-99, considering
that a prior similar case was already filed by her and dismissed on April 22, 1999 by
Branch 76 of the Malolos RTC. Banguis prayed for the dismissal of LRC Case No.
P-443-99 and to be paid moral damages and attorney’s fees by way of counterclaim.
During the course of the proceedings, the parties presented the following evidence,
among others:
1. Marriage Contract of Adriano and Wenifreda;16
2. Publication of Adriano’s death;17
3. Social Security System (SSS) data record of Adriano indicating that

Wenifreda is his spouse;18
4. Barangay Council Certificate indicating that Adriano and Wenifreda were

legally married and residents of No. 13 Hyacinth Road, Phase V, Pilar Village,
Las Piñas City since 1981;19
5. Marriage Contract of Banguis and Nolasco dated October 15, 1975;20
6. Banguis’s SSS Member’s Data Change or Addition Report indicating that

Banguis: a) sought to change her name from “Rosario E. Banguis” to “Rosario
B. Nolasco”; b) listed Nolasco as her husband; and c) changed her civil status
to “married;”21
7. Banguis’s correspondence at work – Ocean East Agency Corporation (Ocean

East), which was owned and operated by Adriano – in which she signed as
“Rosario B. Nolasco;”22
8. Banguis’s résumé on file with Ocean East, reflecting that she was married;23
9. Negative Certification of Marriage issued by the Civil Registrar of Bulacan to

the effect that the Civil Register does not have any record of Adriano and
Banguis’s marriage which was supposedly solemnized on September 2,
1988;24
10. Certification dated April 17, 2002 issued by Rev. Fr. Narciso Sampana, Parish
Priest of St. Joseph Parish, to the effect that the parish never had a parish
priest by the name of Fr. Roberto de Guzman – who is claimed to have
solemnized the alleged marriage between Adriano and Banguis;25
11. Banguis’s testimony on direct examination that she and Adriano were married
on September 2, 1988; that they had a son named Adrian; that Adriano
purchased the subject property on November 17, 1991 per Deed of Sale –
executed in Manila and with Adriano as the purchaser – entered as “Document
No. 173; Page No. 3550; series of 1990” in the notarial registry of Mr. Julian
B. Tubig; that she paid for the same with her own money; and that she stayed
at the subject property each Friday night up to Sunday night;26
12. Banguis’s testimony on cross-examination that she is married to Nolasco, who

is still alive; that her marriage to the latter is still subsisting and has not been
annulled; and that she knew that Adriano was married to someone else;27
13. Photographs depicting Adriano and Banguis as a couple and with a child,
supposedly taken at the subject property.28
On May 26, 2003, the Malolos RTC rendered its Decision, decreeing thus:
WHEREFORE, premises considered, judgment is hereby RENDERED
in favor of the petitioner herein, as follows:
1. Directing the Register of Deeds of Meycauayan, Bulacan to

cancel TCT No. T-145321 (M) and in lieu thereof to issue a
new certificate of title in the name of Adriano M. Tambuyat
married to Wenifreda “Winnie” Balcom Tambuyat;
2. Directing the defendant Rosario Banguis Nolasco of 1714
Ibarra St., Sampaloc, Manila to surrender to the Register of
Deeds for Meycauayan, Bulacan, the owner’s duplicate copy of
TCT No. T-145321 (M) within five (5) days from receipt of the
order, failing which the Register of Deeds should proceed with
the cancellation of said TCT.
3. Directing defendant Rosario Banguis Nolasco to pay petitioner

the sum of P100,000.00 as and by way of moral damages.

the sum of P100,000.00 as and by way of exemplary damages;
and

attorney’s fees in the amount of P100,000.00, and the cost of
suit.
Accordingly, the counterclaim of the oppositor is hereby DISMISSED

for lack of merit.
SO ORDERED.29
In arriving at the above pronouncement, the trial court held among others that under
Section 112 of Act No. 496 or the Land Registration Act – now Section 108 of
Presidential Decree No. 1529 (PD 1529) or the Property Registration Decree30 – court
authorization is required for any alteration or amendment of a certificate of title when
any error, omission or mistake was made in entering a certificate or any memorandum
thereon, or on any duplicate certificate, or when there is reasonable ground for the
amendment or alteration of the title; that it has been established that Wenifreda is the
surviving spouse of Adriano, and the subject property was acquired during their
marriage, but it was erroneously registered in the name of another; that Banguis had a
subsisting marriage with Nolasco when TCT T-145321 was issued with her being
erroneously included and referred to therein as Adriano’s spouse; that Adrian’s
filiation may not be proved collaterally through LRC Case No. P-443-99; that
Wenifreda is entitled to an award of moral and exemplary damages without proof of
pecuniary loss, for the damage caused upon her reputation and social standing caused
by the wanton, fraudulent, malicious and unwarranted inclusion of Banguis’s name in
the title; and that Wenifreda is likewise entitled to attorney’s fees as she was
compelled to litigate and incur expenses to protect her interests by reason of
Banguis’s unjustified act.
Petitioner appealed the trial court’s Decision with the CA. Docketed as CA-G.R. CV
No. 84954, the appeal basically revolved around the thesis that the trial court erred in
applying Section 108 of PD 1529; that with the serious objections raised by Banguis
and considering that she is the actual owner and possessor of the subject property, a
proper action in a different court exercising general jurisdiction should be filed, rather
than in the current trial court which sits merely as a land registration court; that the
trial court disregarded Article 148 of the Family Code31 which provides for the
division of properties acquired by individuals united in a defective marriage; that the
trial court erred in awarding damages, attorney’s fees and costs of suit; that the trial
court erred in granting execution pending appeal despite the absence of any good or
special reasons; and that the denial of her counterclaim was improper.32
Meanwhile, on October 30, 2003, Wenifreda moved for execution pending appeal. It
appears that Banguis failed to oppose the motion; she did not appear during the
scheduled hearings on the motion as well. As a result, the trial court issued a March
30, 2004 Order directing the issuance of a Writ of Execution. Such writ was thus
issued on April 14, 2004. TCT T-145321 was cancelled, and a new title – TCT
T-433713(M) – was issued in its place.
On February 14, 2012, the CA issued the assailed Decision containing the following
decretal portion:
WHEREFORE, the appeal is PARTIALLY GRANTED. The assailed

Decision dated May 26, 2003 issued by the Regional Trial Court,
Branch 10 of Malolos, Bulacan is AFFIRMED with the modification
that the award of moral and exemplary damages, attorney’s fees and
cost of the suit in favor of Wenifreda Tambuyat is hereby deleted.
SO ORDERED.33
The CA sustained the trial court’s application of Section 108 of PD 1529, noting that
Banguis’s name was included in TCT T-145321 by error or mistake. It held that the
evidence adduced proved that Wenifreda – and not Banguis – is the lawful wife of
Adriano; that there is a valid and subsisting marriage between Nolasco and Banguis,
and the latter admitted to such fact during the course of the proceedings in the trial
court; and that Banguis’s opposition to Wenifreda’s petition for cancellation of TCT
T-145321 is not real and genuine as to place the latter’s title to the subject property in
doubt.34
The CA added that contrary to Banguis’s position, a separate and different proceeding
is not necessary to resolve her opposition to the petition in LRC Case No. P-443-99,
as: 1) she in effect acquiesced and freely submitted her issues and concerns to the trial
court for complete determination, submitting all her relevant documentary and other
evidence to the court in order to prove her allegations – particularly that she is the
lawful spouse of Adriano and that she is the actual owner and possessor of the subject
property; and 2) pursuant to law35 and jurisprudence,36 the distinction between the
trial court sitting as a land registration court and as a court of general jurisdiction has
been eliminated with the passage of PD 1529. It held further that, based on the
evidence adduced, Adriano and Banguis are not co-owners of the subject property as
it has been shown that: a) both of them had valid and subsisting marriages when they
conducted their adulterous relations; b) Banguis failed to present even a modicum of
evidence that she contributed to the purchase of the subject property; and c) the deed
of sale itself indicated that Adriano alone was the vendee. Finally, in denying
Wenifreda’s pecuniary awards and Banguis’s counterclaim, the CA held that the
parties are not entitled thereto as there is no legal and factual basis to grant them.
Banguis moved for reconsideration, but in a July 26, 2012 Resolution, the CA was
unconvinced. Hence, the present Petition.
Issues
Banguis cites the following issues for resolution:
1. THE COURT OF APPEALS GROSSLY ERRED IN

SUSTAINING THE RTC WHICH CANCELLED AND
CORRECTED THE QUESTIONED ENTRY IN TCT NO.
T-145321 (M) FROM “ROSARIO E. BANGUIS” TO
“WENIFREDA ‘WINNIE’ BALCOM TAMBUYAT” UNDER
SECTION 108 OF THE PROPERTY REGISTRATION
DECREE DESPITE THE LACK OF JURISDICTION TO
HEAR THE SAME IN VIEW OF THE SERIOUS AND
WEIGHTY OBJECTIONS OF THE PETITIONER AND
THAT THE INSTITUTION OF ESTATE PROCEEDINGS OF
THE LATE ADRIANO M. TAMBUYAT AND THE
CONSEQUENT APPOINTMENT OF AN EXECUTOR OR
ADMINISTRATOR WHICH IS THE PROPER REMEDY
WHO CAN GO AFTER HIS PROPERTIES HELD BY
OTHER PERSONS.

SUSTAINING THE RTC WHICH CORRECTED AND
CANCELLED THE QUESTIONED ENTRY IN TCT NO.
T-145321 (M) THROUGH AN ABSOLUTE AND
COMPLETE DISREGARD OF THE PROOF OF
OWNERSHIP AND POSSESSION BY THE PETITIONER
OVER THE SUBJECT PROPERTY.

SUSTAINING THE RTC WHICH CORRECTED AND
CANCELLED THE QUESTIONED ENTRY IN TCT NO.
T-145321 (M) IN CLEAR VIOLATION OF ARTICLE 148
OF THE FAMILY CODE PROVIDING FOR THE SHARING
OF PROPERTIES ACQUIRED BY PERSONS UNITED IN A
DEFECTIVE MARRIAGE.
SUSTAINING THE RTC WHICH GRANTED THE
IMMEDIATE EXECUTION OF ITS DECISION
NOTWITHSTANDING THE SEASONABLE APPEAL OF
THE PETITIONER AND THE UTTER LACK OF ANY
GOOD OR SPECIAL REASONS JUSTIFYING THE
SAME.37
Petitioner’s Arguments
In her Petition and Reply38 seeking to reverse and set aside the assailed CA
dispositions and thus dismiss Wenifreda’s petition for cancellation in LRC Case No.
P-443-99, Banguis insists on her original position adopted below that Section 108 of
PD 1529 cannot apply in view of the contentious and controversial nature of her
opposition to the petition for cancellation, which can be threshed out only in a
separate proper proceeding where the court sits not merely as a land registration court,
but as a court of general jurisdiction. She cites Tagaytay-Taal Tourist Development
Corporation v. Court of Appeals,39Liwag v. Court of Appeals,40 and Vda. de Arceo v.
Court of Appeals,41 which made pronouncements to such effect.
Banguis adds that the instant case involved the partition of Adriano’s estate which in
effect transfers the subject property to Wenifreda and thus divests her and her son
Adrian of their rights and interests therein; that based on the evidence she introduced,
it should be concluded that the property belongs to her as it was acquired using solely
her own funds and money borrowed from her sister, and because she has been in
constant possession thereof, introducing improvements thereon through the years; that
the subject property is owned in common by her and Adriano since it was acquired
during their cohabitation; and that the CA erred in refusing to rule on the propriety of
the trial court’s grant of execution pending appeal.
Respondent’s Arguments
In Wenifreda’s Comment,42 it is stressed that the distinction between the trial court
acting as a land registration court, on one hand, and its acting as a court of general
jurisdiction, on the other, has been removed with the effectivity of PD 1529; thus, trial
courts are no longer fettered by their former limited jurisdiction which enabled them
to grant relief in land registration cases only when there is unanimity among the
parties, or when none of them raises any adverse claims or serious objections. It is
further argued that Banguis’s claim of ownership cannot stand, for the evidence fails
to indicate that she contributed to the purchase of the subject property, even as the
deed of sale to the property itself shows that Adriano alone is the vendee thereof, and
Banguis signed merely as a witness thereto. Finally, respondent explains that during
the proceedings covering the motion for the issuance of a writ of execution pending
appeal, Banguis was accorded the opportunity to participate, but she did not; as a
result, the old title was cancelled and a new one was accordingly issued in its stead.
Our Ruling
The Court denies the Petition.
The trial court in LRC Case No. P-443-99 was not precluded from resolving the
objections raised by Banguis in her opposition to the petition for cancellation; a
separate action need not be filed in a different court exercising general jurisdiction.
Banguis should be considered to have acquiesced and freely submitted the case to the
trial court for complete determination on her opposition, when she went to trial and
adduced and submitted all her relevant evidence to the court. “The active participation
of the party against whom the action was brought, coupled with his failure to object to
the jurisdiction of the court or quasi-judicial body where the action is pending, is
tantamount to an invocation of that jurisdiction and a willingness to abide by the
resolution of the case and will bar said party from later on impugning the court or
body’s jurisdiction.”43
Under Section 108 of PD 1529, the proceeding for the erasure, alteration, or
amendment of a certificate of title may be resorted to in seven instances: (1) when
registered interests of any description, whether vested, contingent, expectant, or
inchoate, have terminated and ceased; (2) when new interests have arisen or been
created which do not appear upon the certificate; (3) when any error, omission or
mistake was made in entering a certificate or any memorandum thereon or on any
duplicate certificate; (4) when the name of any person on the certificate has been
changed; (5) when the registered owner has been married, or, registered as married,
the marriage has been terminated and no right or interest of heirs or creditors will
thereby be affected; (6) when a corporation, which owned registered land and has
been dissolved, has not conveyed the same within three years after its dissolution; and
(7) when there is reasonable ground for the amendment or alteration of title. 44 The
present case falls under (3) and (7), where the Registrar of Deeds of Bulacan
committed an error in issuing TCT T-145321 in the name of “Adriano M. Tambuyat
married to Rosario E. Banguis” when, in truth and in fact, respondent Wenifreda –
and not Banguis – is Adriano’s lawful spouse.
Proceedings under Section 108 are “summary in nature, contemplating corrections or

insertions of mistakes which are only clerical but certainly not controversial
issues.”45 Banguis’s opposition to the petition for cancellation ostensibly raised
controversial issues involving her claimed ownership and the hereditary rights of
Adrian, which she claims to be her son by Adriano. However, apart from the fact that
evidence of Banguis’s ownership is irrelevant in Wenifreda’s petition, the evidence
apparently indicates that Banguis could not be the owner of the subject property,
while a resolution of the issue of succession is irrelevant and unnecessary to the
complete determination of Wenifreda’s petition. The Court is thus led to the
conclusion that the Registrar of Deeds of Bulacan simply erred in including Banguis
in TCT T-145321 as Adriano’s spouse.
As correctly ruled by the appellate court, the preponderance of evidence points to the
fact that Wenifreda is the legitimate spouse of Adriano. Documentary evidence –
among others, the parties’ respective marriage contracts, which, together with
marriage certificates, are considered the primary evidence of a marital union 46 –
indicates that Adriano was married to Wenifreda, while Banguis was married to
Nolasco – and both marriages were subsisting at the time of the acquisition of the
subject property and issuance of the certificate of title thereto. Thus, it cannot be said
that Adriano and Banguis were husband and wife to each other; it cannot even be said
that they have a common-law relationship at all. Consequently, Banguis cannot be
included or named in TCT T-145321 as Adriano’s spouse; the right and privilege
belonged to Wenifreda alone.
x x x Indeed, Philippine Law does not recognize common law

marriages. A man and woman not legally married who cohabit for
many years as husband and wife, who represent themselves to the
public as husband and wife, and who are reputed to be husband and
wife in the community where they live may be considered legally
married in common law jurisdictions but not in the Philippines.
While it is true that our laws do not just brush aside the fact that such
relationships are present in our society, and that they produce a
community of properties and interests which is governed by law,
authority exists in case law to the effect that such form of
co-ownership requires that the man and woman living together must
not in any way be incapacitated to contract marriage. In any case,
herein petitioner has a subsisting marriage with another woman, a legal
impediment which disqualified him from even legally marrying
Vitaliana. In Santero vs. CFI of Cavite, the Court, thru Mr. Justice
Paras, interpreting Art. 188 of the Civil Code (Support of Surviving
Spouse and Children During Liquidation of Inventoried Property)
stated: “Be it noted however that with respect to ‘spouse’, the same
must be the legitimate ‘spouse’ (not common-law spouses).”
There is a view that under Article 332 of the Revised Penal Code, the
term “spouse” embraces common law relation for purposes of
exemption from criminal liability in cases of theft, swindling and
malicious mischief committed or caused mutually by spouses. The
Penal Code article, it is said, makes no distinction between a couple
whose cohabitation is sanctioned by a sacrament or legal tie and
another who are husband and wife de facto. But this view cannot even
apply to the facts of the case at bar. We hold that the provisions of
the Civil Code, unless expressly providing to the contrary as in
Article 144, when referring to a “spouse” contemplate a lawfully
wedded spouse. Petitioner vis-a-vis Vitaliana was not a
lawfully-wedded spouse to her; in fact, he was not legally capacitated
to marry her in her lifetime.47 (Emphasis supplied)
The only issue that needed to be resolved in LRC Case No. P-443-99 is – who should
be included in the title to the subject property as Adriano’s spouse, Banguis or
Wenifreda? Was there error in placing Banguis’s name in the title as Adriano’s
spouse? If Banguis is Adriano’s spouse, then there would be no need to amend or
even cancel the title. On the other hand, if Wenifreda is Adriano’s spouse, the
inclusion of Banguis would then be erroneous, and TCT T-145321 would have to be
cancelled. All that is required in resolving this issue is to determine who between
them is Adriano’s spouse; it was unnecessary for Banguis to prove that she is the
actual owner of the property. Title to the property is different from the certificate of
title to it.
x x x. In Lee Tek Sheng v. Court of Appeals, the Court made a clear

distinction between title and the certificate of title:
The certificate referred to is that document issued by the
Register of Deeds known as the Transfer Certificate of
Title (TCT). By title, the law refers to ownership which
is represented by that document. Petitioner apparently
confuses certificate with title. Placing a parcel of land
under the mantle of the Torrens system does not mean
that ownership thereof can no longer be disputed.
Ownership is different from a certificate of title. The
TCT is only the best proof of ownership of a piece of
land. Besides, the certificate cannot always be
considered as conclusive evidence of ownership. Mere
issuance of the certificate of title in the name of any
person does not foreclose the possibility that the real
property may be under co-ownership with persons not
named in the certificate or that the registrant may only
be a trustee or that other parties may have acquired
interest subsequent to the issuance of the certificate of
title. To repeat, registration is not the equivalent of title,
but is only the best evidence thereof. Title as a concept
of ownership should not be confused with the certificate
of title as evidence of such ownership although both are
interchangeably used. x x x.
Registration does not vest title; it is merely the evidence of such title.
Land registration laws do not give the holder any better title than what
he actually has.48
Nonetheless, if Banguis felt that she had to go so far as to demonstrate that she is the
true owner of the subject property in order to convince the trial court that there is no
need to cancel TCT T-145321, then she was not precluded from presenting evidence
to such effect. Understandably, with the quality of Wenifreda’s documentary and
other evidence, Banguis may have felt obliged to prove that beyond the certificate of
title, she actually owned the property. Unfortunately for her, this Court is not
convinced of her claimed ownership; the view taken by the CA must be adopted that
she and Adriano could not have been co-owners of the subject property as she failed
to present sufficient proof that she contributed to the purchase of the subject property,
while the deed of sale covering the subject property showed that Adriano alone was
the vendee. This Court is not a trier of facts, so it must rely on the findings of facts of
the Court of Appeals, which are thus considered conclusive and binding.49 Moreover,
the Court notes that while Banguis claims that she alone paid for the property using
her own funds and money borrowed from her sister, she nonetheless acknowledges
that Adriano is a co-owner thereof, thus implying that he contributed to its acquisition.
Such contradictory statements cast serious doubts on her claim; basically, if she were
the sole purchaser of the property, it would only be logical and natural for her to
require that her name be placed on the deed of sale as the vendee, and not as mere
witness – which is what actually occurred in this case. On the other hand, if Adriano
contributed to its purchase, Banguis would have required that her name be placed on
the deed as a co-vendee just the same. Her failure to explain why – despite her claims
that she is the purchaser of the property – she allowed Adriano to be denominated as
the sole vendee, renders her claim of ownership doubtful. “Where a party has the
means in his power of rebutting and explaining the evidence adduced against him, if it
does not tend to the truth, the omission to do so furnishes a strong inference against
him.”50 One cannot also ignore the principle that “the rules of evidence in the main
are based on experience, logic, and common sense.”51
Neither can the Court believe Banguis’s assertion that Wenifreda’s petition for
cancellation of TCT T-145321 is in reality a partition of Adriano’s estate which in
effect transfers the subject property to Wenifreda and thus divests Banguis and her
son Adrian of their rights and interests therein. LRC Case No. P-443-99 is simply a
case for the correction of the wrongful entry in TCT T-145321; it simply aims to
reflect the truth in the certificate of title – that Adriano is married to Wenifreda – and
nothing else. It would have been a summary proceeding, but Banguis complicated
matters by injecting her claims of ownership, which are irrelevant in the first place
for, as earlier stated, registration is not the equivalent of title.
Finally, with the foregoing disquisition, it becomes unnecessary to resolve the other
issues raised by the petitioner, particularly those relating to the trial court’s March 30,
2004 Order directing the issuance of a writ of execution pending appeal, as well as the
April 14, 2004 Writ of Execution issued, as they have become moot and academic.
WHEREFORE, the Petition is DENIED. The February 14, 2012 Decision and July
26, 2012 Resolution of the Court of Appeals in CA-G.R. CV No. 84954
are AFFIRMED.
SO ORDERED.
SALES AND LEASE
Supreme Court
Manila
FIRST DIVISION
ROBERTO D. TUAZON, G.R. No. 168325

Petitioner,
- versus -
Present:
LOURDES Q. DEL ROSARIO-SUAREZ,
CATALINA R. SUAREZ-DE LEON, CORONA, C. J., Chairperson,
WILFREDO DE LEON, MIGUEL LUIS S. LEONARDO-DE CASTRO,
DE LEON, ROMMEL LEE S. DE LEON, DEL CASTILLO,
and GUILLERMA L. SANDICO-SILVA, ABAD,⃰ and
as attorney-in-fact of the defendants, PEREZ, JJ.
except Lourdes Q. Del Rosario-Suarez,
Respondents.
Promulgated:
December 8, 2010
x------------------------------------------------------------------
-x
DECISION
DEL CASTILLO, J.:
In a situation where the lessor makes an offer to sell to the lessee a certain property at a fixed
price within a certain period, and the lessee fails to accept the offer or to purchase on time,
then the lessee loses his right to buy the property and the owner can validly offer it to another.
This Petition for Review on Certiorari[1] assails the Decision[2] dated May 30, 2005 of the
Court of Appeals (CA) in CA-G.R. CV No. 78870, which affirmed the Decision[3] dated
November 18, 2002 of the Regional Trial Court (RTC), Branch 101, Quezon City in Civil
Case No. Q-00-42338.
Factual Antecedents
Respondent Lourdes Q. Del Rosario-Suarez (Lourdes) was the owner of a parcel of land,
containing more or less an area of 1,211 square meters located along Tandang Sora
Street, BarangayOld Balara, Quezon City and previously covered by Transfer Certificate of
Title (TCT) No. RT-56118[4] issued by the Registry of Deeds of Quezon City.
On June 24, 1994, petitioner Roberto D. Tuazon (Roberto) and Lourdes executed a Contract
of Lease[5] over the abovementioned parcel of land for a period of three years. The lease
commenced in March 1994 and ended in February 1997. During the effectivity of the
lease, Lourdes sent a letter[6] dated January 2, 1995 to Roberto where she offered to sell to the
latter subject parcel of land. She pegged the price at P37,541,000.00 and gave him two years
from January 2, 1995 to decide on the said offer.
On June 19, 1997, or more than four months after the expiration of the Contract of
Lease, Lourdes sold subject parcel of land to her only child, Catalina Suarez-De Leon, her
son-in-law Wilfredo De Leon, and her two grandsons, Miguel Luis S. De Leon and Rommel
S. De Leon (the De Leons), for a total consideration of only P2,750,000.00 as evidenced by a
Deed of Absolute Sale[7] executed by the parties. TCT No. 177986[8] was then issued by the
Registry of Deeds of Quezon City in the name of the De Leons.
The new owners through their attorney-in-fact, Guillerma S. Silva, notified Roberto
to vacate the premises. Roberto refused hence, the De Leons filed a complaint for Unlawful
Detainer before the Metropolitan Trial Court (MeTC) of Quezon City against him. On
August 30, 2000, the MeTC rendered a Decision[9] ordering Roberto to vacate the property
for non-payment of rentals and expiration of the contract.
On November 8, 2000, while the ejectment case was on appeal, Roberto filed with
the RTC of Quezon City a Complaint[10] for Annulment of Deed of Absolute Sale,
Reconveyance, Damages and Application for Preliminary Injunction against Lourdes and the
De Leons. On November 13, 2000, Roberto filed a Notice of Lis Pendens[11] with the
Registry of Deeds of Quezon City.
On January 8, 2001, respondents filed An Answer with Counterclaim[12] praying that

the Complaint be dismissed for lack of cause of action. They claimed that the filing of such
case was a mere leverage of Roberto against them because of the favorable Decision issued
by the MeTC in the ejectment case.
On September 17, 2001, the RTC issued an Order[13] declaring Lourdes and the De
Leons in default for their failure to appear before the court for the second time despite
notice. Upon a Motion for Reconsideration,[14] the trial court in an Order[15] dated October 19,
2001 set aside its Order of default.
After trial, the court a quo rendered a Decision declaring the Deed of Absolute Sale
made by Lourdes in favor of the De Leons as valid and binding. The offer made
by Lourdes to Roberto did not ripen into a contract to sell because the price offered by the
former was not acceptable to the latter. The offer made by Lourdes is no longer binding and
effective at the time she decided to sell the subject lot to the De Leons because the same was
not accepted by Roberto. Thus, in a Decision dated November 18, 2002, the trial court
dismissed the complaint. Its dispositive portion reads:
WHEREFORE, premises considered, judgment is hereby rendered

dismissing the above-entitled Complaint for lack of merit, and ordering the
Plaintiff to pay the Defendants, the following:
1. the amount of P30,000.00 as moral damages;

2. the amount of P30,000.00 as exemplary damages;
3. the amount of P30,000.00 as attorneys fees; and
4. cost of the litigation.
SO ORDERED.[16]
On May 30, 2005, the CA issued its Decision dismissing Robertos appeal and
affirming the Decision of the RTC.
Hence, this Petition for Review on Certiorari filed by Roberto advancing the following
arguments:
I.
THE TRIAL COURT AND THE COURT OF APPEALS HAD DECIDED
THAT THE RIGHT OF FIRST REFUSAL EXISTS ONLY WITHIN THE
PARAMETERS OF AN OPTION TO BUY, AND DID NOT EXIST
WHEN THE PROPERTY WAS SOLD LATER TO A THIRD PERSON,
UNDER FAVORABLE TERMS AND CONDITIONS WHICH THE
FORMER BUYER CAN MEET.
II.
WHAT IS THE STATUS OR SANCTIONS OF AN APPELLEE IN THE
COURT OF APPEALS WHO HAS NOT FILED OR FAILED TO FILE
AN APPELLEES BRIEF?[17]
Petitioners Arguments
Roberto claims that Lourdes violated his right to buy subject property under
the principle of right of first refusal by not giving him notice and the opportunity to buy the
property under the same terms and conditions or specifically based on the much lower price
paid by the De Leons.
Roberto further contends that he is enforcing his right of first refusal based on Equatorial
Realty Development, Inc. v. Mayfair Theater, Inc.[18] which is the leading case on the right of
first refusal.
Respondents Arguments
On the other hand, respondents posit that this case is not covered by the principle of
right of first refusal but an unaccepted unilateral promise to sell or, at best, a contract of option
which was not perfected. The letter of Lourdes to Roberto clearly embodies an option
contract as it grants the latter only two years to exercise the option to buy the subject property
at a price certain of P37,541,000.00. As an option contract, the said letter would have been
binding upon Lourdes without need of any consideration, had Roberto accepted the offer. But
in this case there was no acceptance made neither was there a distinct consideration for the
option contract.
Our Ruling
The petition is without merit.
This case involves an option contract and

not a contract of a right of first refusal
In Beaumont v. Prieto,[19] the nature of an option contract is explained thus:
In his Law Dictionary, edition of 1897, Bouvier defines an option as a contract, in the
following language:
A contract by virtue of which A, in consideration of the payment of a
certain sum to B, acquires the privilege of buying from, or selling to, B
certain securities or properties within a limited time at a specified price.
(Story vs. Salamon, 71 N. Y., 420.)
From Vol. 6, page 5001, of the work Words and Phrases, citing the case of Ide vs.
Leiser (24 Pac., 695; 10 Mont., 5; 24 Am. St. Rep., 17) the following
quotation has been taken:
An agreement in writing to give a person the option to purchase lands

within a given time at a named price is neither a sale nor an agreement to
sell. It is simply a contract by which the owner of property agrees with
another person that he shall have the right to buy his property at a fixed
price within a certain time. He does not sell his land; he does not then agree
to sell it; but he does sell something; that is, the right or privilege to buy at the
election or option of the other party. The second party gets in praesenti, not
lands, nor an agreement that he shall have lands, but he does get something of
value; that is, the right to call for and receive lands if he elects. The owner
parts with his right to sell his lands, except to the second party, for a limited
period. The second party receives this right, or rather, from his point of view,
he receives the right to elect to buy.
But the two definitions above cited refer to the contract of option, or, what amounts to
the same thing, to the case where there was cause or consideration for the
obligation x x x. (Emphasis supplied.)
On the other hand, in Ang Yu Asuncion v. Court of Appeals,[20] an elucidation on the

right of first refusal was made thus:
In the law on sales, the so-called right of first refusal is an innovative juridical
relation. Needless to point out, it cannot be deemed a perfected contract of
sale under Article 1458 of the Civil Code. Neither can the right of first refusal,
understood in its normal concept, per se be brought within the purview of an
option under the second paragraph of Article 1479, aforequoted, or possibly
of an offer under Article 1319 of the same Code. An option or an offer would
require, among other things, a clear certainty on both the object and the cause
or consideration of the envisioned contract. In a right of first refusal, while
the object might be made determinate, the exercise of the right, however,
would be dependent not only on the grantor's eventual intention to enter
into a binding juridical relation with another but also on terms,
including the price, that obviously are yet to be later firmed up. Prior
thereto, it can at best be so described as merely belonging to a class of
preparatory juridical relations governed not by contracts (since the essential
elements to establish the vinculum juris would still be indefinite and
inconclusive) but by, among other laws of general application, the pertinent
scattered provisions of the Civil Code on human conduct.
Even on the premise that such right of first refusal has been decreed
under a final judgment, like here, its breach cannot justify correspondingly an
issuance of a writ of execution under a judgment that merely recognizes its
existence, nor would it sanction an action for specific performance without
thereby negating the indispensable element of consensuality in the perfection
of contracts. It is not to say, however, that the right of first refusal would be
inconsequential for, such as already intimated above, an unjustified disregard
thereof, given, for instance, the circumstances expressed in Article 19 of the
Civil Code, can warrant a recovery for damages. (Emphasis supplied.)
From the foregoing, it is thus clear that an option contract is entirely different and distinct
from a right of first refusal in that in the former, the option granted to the offeree is for a fixed
periodand at a determined price. Lacking these two essential requisites, what is involved is
only a right of first refusal.
In this case, the controversy is whether the letter of Lourdes to Roberto dated January 2, 1995
involved an option contract or a contract of a right of first refusal. In its entirety, the said
letter-offer reads:
206 Valdes Street

Josefa Subd. Balibago
Angeles City 2009
January 2, 1995
Tuazon Const. Co.

986 Tandang Sora Quezon City
Dear Mr. Tuazon,
I received with great joy and happiness the big box of sweet grapes
and ham, fit for a kings party. Thanks very much.
I am getting very old (79 going 80 yrs. old) and wish to live in
the U.S.A. with my only family. I need money to buy a house and lot and a
farm with a little cash to start.
I am offering you to buy my 1211 square meter at P37,541,000.00 you can

pay me in dollars in the name of my daughter. I never offered it to anyone.
Please shoulder the expenses for the transfer. I wish the Lord God will help
you buy my lot easily and you will be very lucky forever in this place. You
have all the time to decide when you can, but not for 2 years or more.
I wish you long life, happiness, health, wealth and great fortune always!
I hope the Lord God will help you be the recipient of multi-billion projects
aid from other countries.
Thank you,
Lourdes Q. del Rosario vda de Suarez
It is clear that the above letter embodies an option contract as it grants Roberto a fixed period
of only two years to buy the subject property at a price certain of P37,541,000.00. It being an
option contract, the rules applicable are found in Articles 1324 and 1479 of the Civil Code
which provide:
Art. 1324. When the offerer has allowed the offeree a certain period
to accept, the offer may be withdrawn at any time before acceptance by
communicating such withdrawal, except when the option is founded upon a
consideration, as something paid or promised.
Art. 1479. A promise to buy and sell a determinate thing for a price
certain is reciprocally demandable.
An accepted unilateral promise to buy or to sell a determinate thing

for a price certain is binding upon the promissor if the promise is supported
by a consideration distinct from the price.
It is clear from the provision of Article 1324 that there is a great difference between
the effect of an option which is without a consideration from one which is founded upon a
consideration. If the option is without any consideration, the offeror may withdraw his offer
by communicating such withdrawal to the offeree at anytime before acceptance; if it is
founded upon a consideration, the offeror cannot withdraw his offer before the lapse of the
period agreed upon.
The second paragraph of Article 1479 declares that an accepted unilateral promise to buy or
to sell a determinate thing for a price certain is binding upon the promissor if the promise is
supported by a consideration distinct from the price. Sanchez v. Rigos[21] provided an
interpretation of the said second paragraph of Article 1479 in relation to Article 1324. Thus:
There is no question that under Article 1479 of the new Civil Code
"an option to sell," or "a promise to buy or to sell," as used in said article, to
be valid must be "supported by a consideration distinct from the price." This
is clearly inferred from the context of said article that a unilateral promise to
buy or to sell, even if accepted, is only binding if supported by consideration.
In other words, "an accepted unilateral promise can only have a binding
effect if supported by a consideration, which means that the option can still be
withdrawn, even if accepted, if the same is not supported by any
consideration. Hence, it is not disputed that the option is without
consideration. It can therefore be withdrawn notwithstanding the acceptance
made of it by appellee.
It is true that under Article 1324 of the new Civil Code, the general
rule regarding offer and acceptance is that, when the offerer gives to the
offeree a certain period to accept, "the offer may be withdrawn at any time
before acceptance" except when the option is founded upon consideration,
but this general rule must be interpreted as modified by the provision of
Article 1479 above referred to, which applies to "a promise to buy and
sell" specifically. As already stated, this rule requires that a promise to sell to
be valid must be supported by a consideration distinct from the price.
In Diamante v. Court of Appeals,[22] this Court further declared that:
A unilateral promise to buy or sell is a mere offer, which is not

converted into a contract except at the moment it is accepted. Acceptance is
the act that gives life to a juridical obligation, because, before the
promise is accepted, the promissor may withdraw it at any time. Upon
acceptance, however, a bilateral contract to sell and to buy is created, and the
offeree ipso facto assumes the obligations of a purchaser; the offeror, on the
other hand, would be liable for damages if he fails to deliver the thing he had
offered for sale.
xxxx
Even if the promise was accepted, private respondent was not

bound thereby in the absence of a distinct consideration. (Emphasis ours.)
In this case, it is undisputed that Roberto did not accept the terms stated in the letter
of Lourdes as he negotiated for a much lower price. Robertos act of negotiating for a much
lower price was a counter-offer and is therefore not an acceptance of the offer
of Lourdes. Article 1319 of the Civil Code provides:
Consent is manifested by the meeting of the offer and the acceptance upon
the thing and the cause which are to constitute the contract. The offer must be
certain and the acceptance absolute. A qualified acceptance constitutes a
counter-offer. (Emphasis supplied.)
The counter-offer of Roberto for a much lower price was not accepted by Lourdes.
There is therefore no contract that was perfected between them with regard to the sale of
subject property. Roberto, thus, does not have any right to demand that the property be sold to
him at the price for which it was sold to the De Leons neither does he have the right to
demand that said sale to the De Leons be annulled.
Equatorial Realty Development, Inc. v.

Mayfair Theater, Inc. is not applicable here
It is the position of Roberto that the facts of this case and that of Equatorial are similar in
nearly all aspects. Roberto is a lessee of the property like Mayfair Theater
in Equatorial. There was an offer made to Roberto by Lourdes during the effectivity of the
contract of lease which was also the case in Equatorial. There were negotiations as to the
price which did not bear fruit because Lourdes sold the property to the De Leons which was
also the case in Equatorial wherein Carmelo and Bauermann sold the property to
Equatorial. The existence of the lease of the property is known to the De Leons as they are
related to Lourdes while in Equatorial, the lawyers of Equatorial studied the lease contract
of Mayfair over the property. The property in this case was sold by Lourdes to the De Leons
at a much lower price which is also the case in Equatorial where Carmelo and Bauerman sold
to Equatorial at a lesser price. It is Robertos conclusion that as in the case of Equatorial, there
was a violation of his right of first refusal and hence annulment or rescission of the Deed of
Absolute Sale is the proper remedy.
Robertos reliance in Equatorial is misplaced. Despite his claims, the facts

in Equatorial radically differ from the facts of this case. Roberto overlooked the fact that
in Equatorial, there was an express provision in the Contract of Lease that
(i)f the LESSOR should desire to sell the leased properties, the LESSEE shall
be given 30-days exclusive option to purchase the same.
There is no such similar provision in the Contract of Lease between Roberto

and Lourdes. What is involved here is a separate and distinct offer made by Lourdes through
a letter dated January 2, 1995 wherein she is selling the leased property to Roberto for a
definite price and which gave the latter a definite period for acceptance. Roberto was not
given a right of first refusal. The letter-offer of Lourdes did not form part of the Lease
Contract because it was made more than six months after the commencement of the lease.
It is also very clear that in Equatorial, the property was sold within the lease period. In this
case, the subject property was sold not only after the expiration of the period provided in the
letter-offer of Lourdes but also after the effectivity of the Contract of Lease.
Moreover, even if the offer of Lourdes was accepted by Roberto, still the former is not bound
thereby because of the absence of a consideration distinct and separate from the price. The
argument of Roberto that the separate consideration was the liberality on the part
of Lourdes cannot stand. A perusal of the letter-offer of Lourdes would show that what drove
her to offer the property to Roberto was her immediate need for funds as she was already very
old. Offering the property to Roberto was not an act of liberality on the part of Lourdes but
was a simple matter of convenience and practicality as he was the one most likely to buy the
property at that time as he was then leasing the same.
All told, the facts of the case, as found by the RTC and the CA, do not support Robertos
claims that the letter of Lourdes gave him a right of first refusal which is similar to the one
given to Mayfair Theater in the case of Equatorial. Therefore, there is no justification to annul
the deed of sale validly entered into by Lourdes with the De Leons.
What is the effect of the failure of Lourdes to
file her appellees brief at the CA?
Lastly, Roberto argues that Lourdes should be sanctioned for her failure to file her appellees
brief before the CA.
Certainly, the appellees failure to file her brief would not mean that the case would be
automatically decided against her. Under the circumstances, the prudent action on the part of
the CA would be to deem Lourdes to have waived her right to file her appellees
brief. De Leon v. Court of Appeals,[23] is instructive when this Court decreed:
On the second issue, we hold that the Court of Appeals did not
commit grave abuse of discretion in considering the appeal submitted for
decision. The proper remedy in case of denial of the motion to dismiss is to
file the appellees brief and proceed with the appeal. Instead, petitioner opted
to file a motion for reconsideration which, unfortunately, was pro forma. All
the grounds raised therein have been discussed in the first resolution of the
respondent Court of Appeals. There is no new ground raised that might
warrant reversal of the resolution. A cursory perusal of the motion would
readily show that it was a near verbatim repetition of the grounds stated in the
motion to dismiss; hence, the filing of the motion for reconsideration did not
suspend the period for filing the appellees brief. Petitioner was therefore
properly deemed to have waived his right to file appellees
brief. (Emphasis supplied.)
In the above cited case, De Leon was the plaintiff in a Complaint for a sum of money in the
RTC. He obtained a favorable judgment and so defendant went to the CA. The appeal of
defendant-appellant was taken cognizance of by the CA but De Leon filed a Motion to
Dismiss the Appeal with Motion to Suspend Period to file Appellees Brief. The CA denied
the Motion to Dismiss.De Leon filed a Motion for Reconsideration which actually did not
suspend the period to file the appellees brief. De Leon therefore failed to file his brief within
the period specified by the rules and hence he was deemed by the CA to have waived his right
to file appellees brief.
The failure of the appellee to file his brief would not result to the rendition of a decision
favorable to the appellant. The former is considered only to have waived his right to file the
Appellees Brief. The CA has the jurisdiction to resolve the case based on the Appellants Brief
and the records of the case forwarded by the RTC. The appeal is therefore considered
submitted for decision and the CA properly acted on it.
WHEREFORE, the instant petition for review on certiorari is DENIED. The

assailed Decision of the Court of Appeals in CA-G.R. CV No. 78870, which affirmed the
Decision dated November 18, 2002 of the Regional Trial Court, Branch 101, Quezon City in
Civil Case No. Q-00-42338 is AFFIRMED.
SO ORDERED.

Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
Chairperson
TERESITA J. LEONARDO-DE CASTRO ROBERTO A. ABAD

Associate Justice Associate Justice
JOSE PORTUGAL PEREZ
Associate Justice
CERTIFICATION
RENATO C. CORONA
Chief Justice
⃰
In lieu of Associate Justice Presbitero J. Velasco, Jr., per Special Order No. 917 dated
November 24, 2010.
[1]
Rollo, pp. 9-26.
[2]
CA rollo, pp. 41-55; penned by Associate Justice Vicente S.E. Veloso and
concurred in by Associate Justices Roberto A. Barrios and Amelita G. Tolentino.
[3]
Records, pp. 154-162.
[4]
Id. at 7-9.
[5]
Id. at 10-11.
[6]
Id. at 14.
[7]
Id. at 15-16.
[8]
Id. at 17-18.
[9]
Id. at 23-25.
[10]
Id. at 1-6.
[11]
Id. at 33-35.
[12]
Id. at 48-54.
[13]
Id. at 74.
[14]
Id. at 75-78.
[15]
Id. at 97.
[16]
Id. at 162.
[17]
Id. at 121-122.
[18]
332 Phil 525, 550 (1996).
[19]
41 Phil 670, 686-687 (1916).
[20]
G.R. No. 109125, December 2, 1994, 238 SCRA 602, 614-615.
[21]
150-A Phil. 714, 721-722 (1972), citing Southwestern Sugar and Molasses Co. v.
Atlantic Gulf and Pacific Co., 97 Phil. 249 251-252 (1955).
[22]
G.R. No. 51824, February 7, 1992, 206 SCRA 52, 62, citing Tolentino, Civil Code
of the Philippines, vol. V, 1959 ed., 20-21.
[23]
432 Phil. 775, 791 (2002).
G.R. No. 176043 January 15, 2014
SPOUSES BERNADETTE and RODULFO VILBAR, Petitioners,

vs.
ANGELITO L. OPINION, Respondent.
DECISION
DEL CASTILLO, J.:
"Registration is the operative act which gives validity to the transfer or creates a lien
upon the land."1 Before this Court is a Petition for Review on Certiorari2 of the May
26, 2006 Decision3 of the Court of Appeals (CA) in CA-G.R. CV No. 84409 which
affirmed the January 31, 2005 Decision4 of the Regional Trial Court (RTC), Branch
255, Las Piñas City in Civil Case No. 98-0302, an accion reinvindicatoria case filed
by respondent Angelito L Opinion (Opinion) against petitioner-spouses Bernadette
and Rodulfo Vilbar (spouses Vilbar) and others.
Also assailed is the CA' s December 22, 2006 Resolution5 which denied spouses
Vilbar's Motion for Reconsideration.6
Factual Antecedents
Spouses Vilbar claimed that on July 10, 1979, they and Dulos Realty and
Development Corporation (Dulos Realty), entered into a Contract to Sell7 involving a
108-square meter lot designated as Lot 20-B located in Airmen’s Village, Las Piñas
City and covered by Transfer Certificate of Title (TCT) No. S-39849 for ₱19,440.00.
Lot 20-A which is also covered and embraced by the same certificate of title is the
subject of another Contract to Sell between Elena Guingon (Elena) and Dulos Realty.
Sometime in August 1979, spouses Vilbar took possession of Lot 20-B in the concept
of owners and exercised acts of ownership thereon with the permission of Dulos
Realty after making some advance payment.8
Upon full payment of the purchase price for Lot 20, or on June 1, 1981, Dulos Realty
executed a duly notarized Deed of Absolute Sale9 in favor of spouses Vilbar and their
co-purchaser Elena. Dulos Realty also surrendered and delivered the owner’s
duplicate copy of TCT No. S-39849 covering Lot 20 to the buyers and new owners of
the property. However, spouses Vilbar and Elena were not able to register and transfer
the title in their names because Dulos Realty allegedly failed to have the lot formally
subdivided despite its commitment to do so, until its President, Juan B. Dulos (Juan),
died without the subdivision being accomplished.10
Spouses Vilbar and Dulos Realty also executed a Contract to Sell11 dated July 10,
1979 covering Lot 21, Block 4 of Airmen’s Village, with an area of 216 square meters
and covered by TCT No. S-39850 amounting to ₱128,880.00. To pay for the balance
of the purchase price amounting to ₱99,216.00, spouses Vilbar obtained a housing
loan from the Development Bank of the Philippines (DBP) secured by a real estate
mortgage12 over the said lot. Dulos Realty facilitated the approval of the loan, the
proceeds of which were immediately paid to it as full payment of the purchase price.13
In 1991, the spouses Vilbar were able to pay the loan in full and DBP issued the
requisite Cancellation of Mortgage14 on March 25, 1991. Thereafter, DBP surrendered
TCT No. 36777 / T-17725-A issued by the Registry of Deeds of Pasay City in the
name of Bernadette Vilbar to the spouses Vilbar.15 The spouses Vilbar have been in
actual, open and peaceful possession of Lot 21 and occupy the same as absolute
owners since 1981.
In contrast, Opinion claimed that he legally acquired Lots 20 and 21 through

extra-judicial foreclosure of mortgage constituted over the said properties by Otilio
Gorospe, Sr. and Otilio "Lito" Gorospe, Jr. (Gorospes) in his favor. Opinion alleged
that on January 12, 1995, the Gorospes borrowed ₱440,000.00 and, to secure the loan,
executed a Deed of Real Estate Mortgage16 over the subject lots covered by TCT Nos.
T-44796 (Lot 21)17 and T-44797 (Lot 20).18 The Gorospes defaulted, prompting
Opinion to file a Petition for Extra-Judicial Foreclosure of Real Estate
Mortgage19 dated October 17, 1995 with the Office of the Notary Public of Las Piñas
City. Subsequently, the subject properties were sold at a public auction where Opinion
emerged as the highest bidder. A Certificate of Sale20 was issued in his favor on
December 18, 1995 and subsequently annotated on the TCTs of the properties. The
Gorospes failed to redeem the properties within the reglementary period resulting in
the eventual cancellation of their titles. Thus, TCT No. T-59010 (Lot 21)21 and TCT
No. T-59011 (Lot 20)22 in the name of Opinion were issued on January 22, 1997 by
the Registry of Deeds of Las Piñas City.
On February 13, 1997, Opinion filed a Petition for Issuance of a Writ of

Possession23 against the Gorospes with the RTC of Las Piñas City, Branch 253,
docketed as LRC Case No. LP-162. Branch 253 initially issued a Writ of Possession
and spouses Vilbar and Elena were served with a notice to vacate the premises.
However, the writ was quashed when spouses Vilbar filed an urgent motion for the
quashal of the writ and presented their title to Lot 21, while Elena presented the Deed
of Absolute Sale executed by Dulos Realty covering Lot 20. Consequently, Opinion
filed a Complaint for Accion Reinvindicatoria with Damages24 docketed as Civil Case
No. 98-0302 and raffled to Branch 255 of the RTC of Las Piñas City for him to be
declared as the lawful owner and possessor of the subject properties and for his titles
to be declared as authentic. He likewise prayed for the cancellation of the titles of
spouses Vilbar and Elena.25
During trial, spouses Vilbar presented the Absolute Deed of Sale26 executed by Dulos
Realty in their favor and the owner’s duplicate copy of TCT No. S-3984927 covering
Lot 20. With respect to Lot 21, spouses Vilbar presented the real estate
mortgage28 they executed in favor of DBP; the official receipts29 issued by DBP
showing that they had paid the amortizations for the housing loan; the Cancellation of
Mortgage30 issued by DBP as proof that they have fully paid the loan; tax
declarations31 and receipts32 to show that the property’s tax declaration under the
name of Dulos Realty had been cancelled and a new one had been issued in their
name in 1987 and that they have been paying the real property taxes on the property
since 1980. The spouses Vilbar also presented TCT No. 36777/T-17725-A33 issued by
the Registry of Deeds of Pasay City on May 22, 1981, as proof of their ownership of
Lot 21.
Opinion, on the other hand, justified the legality of his claim over the properties by
tacking his rights on the rights passed on to him by the Gorospes. He traced his rights
over the properties by claiming that Gorospe, Sr. was the former chairman of the
Board of Directors and Chief Executive Officer (CEO) of Dulos Realty. He was
offered substantial benefits and privileges by Dulos Realty as compensation for the
positions he held, including a residential house and lot in Airmen’s Village, Las Piñas
City valued at ₱180,000.00 and various allowances. However, Dulos Realty was not
able to give to Gorospe, Sr. the promised allowances despite repeated demands. Thus,
Gorospe, Sr. was constrained to file a Complaint for Sum of Money, Specific
Performance and Damages34 dated May 12, 1981 with the then Court of First Instance
(CFI) of Manila. Subsequently, Juan signed a compromise agreement and based
thereon the trial court rendered a Decision35 dated April 1, 1982 ordering Dulos
Realty to pay Gorospe, Sr. the total amount of ₱578,000.00. A Writ of Execution and
Alias Writ of Execution were issued by the trial court in its Orders36 dated May 7,
1982 and September 30, 1983, respectively. Dulos Realty filed several cases
challenging the validity of the compromise agreement and seeking to nullify the writs
of execution, as well as the consequent levy and public auction sale of its
properties.37 One of the cases it filed was Civil Case No. 88-280038 seeking the
nullification, cancellation and reconveyance of title on the ground, among others, that
during the auction sale its properties were undervalued. All of its efforts, however,
proved futile. Meanwhile, real properties of Dulos Realty were levied on October 31,
1984, which included Lots 20 and 21 covered by TCT Nos. S-39849 and S-39850,
respectively.39 The disputed properties were eventually sold at public auction on June
24, 1985 where Gorospe, Sr. emerged as the highest bidder.40 On June 2, 1987, the
Registry of Deeds of Pasay City issued TCT Nos. 117331 (Lot 20)41 and 117330 (Lot
21)42 in the name of Gorospe, Sr. and his wife. Upon the death of Gorospe, Sr.’s wife,
the Gorospes transferred the titles in their names resulting in the issuance of TCT Nos.
T-44797 (Lot 20)43 and T-44796 (Lot 21)44 by the Registry of Deeds of Las Piñas
City.
During the course of the trial, Opinion likewise stated under oath that prior to the
execution of the real estate mortgage between him and the Gorospes, he was given
copies of the titles to the properties which he verified with the Registry of Deeds to be
authentic45 and that he inspected the subject properties and learned that there were
occupants.46 Opinion stated that he was informed by the Gorospes that the occupants,
spouses Vilbar and Elena, were mere tenants renting from them.47 Opinion admitted
that he neither talked to the occupants nor made any inquiries as to the nature of their
occupation over the subject properties;48 he did not inquire further to determine
whether there was a pending controversy;49 and, that he merely relied on the
statements of Gorospe, Sr. regarding the tenancy of the occupants without having
been shown any contract of lease, proof of rental payments, or even an electric bill
statement.50
It was only after his Writ of Possession was quashed when he learned that spouses
Vilbar and Elena are also claiming ownership over the properties, prompting him to
make a more thorough investigation.51 Opinion stated that despite the discovery of the
adverse claims over the properties mortgaged to him, he did not ask Gorospe, Sr. why
there are other claimants to the subject properties.52 When asked about what he
learned after investigating said claims, he declared that the titles of the spouses Vilbar
are spurious because they contain discrepancies with the originals on file with the
Registry of Deeds. According to Opinion, spouses Vilbar’s titles do not have entries
indicating the titles from which they were derived.53 To bolster his claim, Opinion
also presented a 2nd Indorsement54 dated May 11, 1988 issued by the Registry of
Deeds of Pasay City which states that TCT No. 36777 of the spouses Vilbar is
presumed to be not validly issued.55 Upon clarification, however, Opinion admitted
that he made no further follow-up with the Registry of Deeds to determine the final
outcome of the investigation on the title of the spouses Vilbar.56
On January 31, 2005, the trial court rendered its Decision57 in favor of Opinion
declaring that he lawfully acquired the disputed properties and that his titles are valid,
the sources of which having been duly established.58 The dispositive portion of the
Decision reads:
WHEREFORE, the foregoing considered, judgment is hereby rendered in favor of

plaintiff Angelito L. Opinion, and against defendants Sps. Bernadette and Rodulfo
Vilbar, including defendants Otilio Gorospe, Sr., Otilio Gorospe, Jr. and Elena
Guingon, ordering the said defendants to immediately turn over possession of Lots 20
and 21, both of Block 4, located at Airmen’s Village, Las Piñas City, to the herein
plaintiff being the registered owner thereof per TCT Nos. T-59010 and T-59011
issued in his name.
Likewise, the above defendants are hereby directed to pay to the herein plaintiff the
sum of ₱100,00.00 as and by way of attorney’s fees, including the cost of suit.
SO ORDERED.59
The trial court, in ruling for Opinion, ratiocinated that there was no doubt that
Opinion’s predecessors-in-interest likewise acquired title to the properties through
lawful means.60 Titles originally in the name of Dulos Realty were cancelled after
implementation and execution of the April 1, 1982 Decision of the CFI in favor of
Gorospe, Sr. and new titles were issued in his name.61 The trial court noted that when
a new title for Lot 21 was issued in the name of Gorospe, Sr. on June 2, 1987, there
was no indication that the title of Dulos Realty was already cancelled by Bernadette
Vilbar’s TCT No. 36777 purporting to have been issued on May 22, 1981.62 As to Lot
20, the trial court noted that the supposed Deed of Absolute Sale dated June 1, 1981 in
favor of defendants Bernadette Vilbar and Guingon was not annotated on TCT No.
39849. Thus, when this was cancelled by the subsequent titles, the property was not
subject to any lien or encumbrance whatsoever pertaining to said purported Deed of
Absolute Sale.63 The trial court also opined that the efforts of Dulos Realty to
question and annul the earlier rulings of the then Intermediate Appellate Court and
Supreme Court did not prosper thereby strengthening the validity of the title of the
Gorospes.64 Further, the trial court found the mortgage in favor of Opinion, and the
subsequent extrajudicial foreclosure thereof to be in order.65
As to spouses Vilbars’ evidence, the trial court found their title to Lot 21 questionable
as there was no showing that it came from TCT No. 39850 issued in the name of
Dulos Realty.66 The Contract to Sell of the spouses Vilbar can hardly serve as basis
for the transfer of Lot 21 in their favor. Besides, the same was not even annotated on
the title of Dulos Realty.67 The trial court also found the issuance of TCT No. 36777
questionable because there was no proof that the purchase price was already paid
considering that only a Contract to Sell was available. As a result, spouses Vilbar only
had an inchoate right over the property.68 The trial court went on to state:
Definitely, defendants Sps. Vilbar cannot readily claim that they acquired Lot 21 in
good faith and for value. Based on the documents they presented, they cannot assert
ignorance or allege that they were not aware that the purchase price for Lot 21,
including any interest they may have in Lot 20, has not been duly settled at the time
TCT No. 36777 for Lot 21 was issued in their favor or even when the Deed of
Absolute Sale dated 01 June 1981 for Lot 20 was executed.
The payments supposedly made by the defendants Sps. Vilbar to the DBP only
establishes the fact that they have not complied with what they obligated themselves
with insofar as the above contracts to sell are concerned. More importantly, there is
nothing in the records which would show that these contracts have been superseded
by another deed to justify the transfer, among others, of TCT No. 39850 registered in
the name of the defendant Dulos Realty to the defendants Sps. Vilbar, or the
execution of a deed of sale involving Lot 20 covered by TCT No. 39849. Needless to
state, the fact that a mortgage contract was allegedly entered into by the defendants
Sps. Vilbar with the DBP does not, by itself, result in a conclusive presumption that
they have a valid title to Lot 21. Instead, this begs more questions than answers since
the said mortgage was entered into on 21 May 1981, or a day after TCT No. 36777
was issued in favor of the defendants Sps. Vilbar. Added to this, the herein defendants
failed to establish the basis for the issuance of their said title even when their
contracts to sell indicate that the purchase price for Lot 21 would be paid on
installments over a long period of time.
such "indicia" in favor of the defendants Sps. Vilbar had been effectively impugned or
refuted.
Moreso, the possession of the alleged original owner’s copy of TCT No. 39849 for
Lot 20 by the defendants Sps. Vilbar or the execution of a deed of sale in favor of
defendants Bernadette Vilbar and Guingon over the same cannot ripen into ownership
thereof. It must be stressed that no subsequent title was issued in favor of the said
defendants even when they have the above documents with them. On the other hand,
the plaintiff eventually secured a title over Lot 20 after consolidating his ownership
with respect thereto.
The fact that the defendants Sps. Vilbar are in possession of the subject lots cannot
persuade the Court to rule in their favor. This is more settled insofar as Lot 20 is
concerned. Having a valid title thereto, the claim of the plaintiff cannot just be
ignored. It is a fundamental principle in land registration that a certificate of title
serves as evidence of an indefeasible and incontrovertible title to the property in favor
of the person whose name appears therein. (Vda. De Retuerto vs. Barz, 372 SCRA
712)69
Further, the trial court gave much credence to the 2nd Indorsement dated May 11,
1988 from the Registry of Deeds of Pasay City which provided that TCT No. 36777 is
presumed not to be validly issued considering that no inscription exists at the back of
the original title (TCT No. S-39850) showing that a Deed of Sale between Dulos
Realty and spouses Vilbar had been registered. The discrepancy in the entries, or lack
of it, in the TCTs in the custody of the spouses Vilbar and the Registry of Deeds of
Las Piñas City70 also tilted the balance against the said spouses.
Aggrieved, the spouses Vilbar appealed to the CA on February 22, 2005.71
On May 26, 2006, the CA promulgated its Decision72 affirming the Decision of the
RTC. The CA agreed with the trial court’s ruling that Opinion validly acquired title
over Lots 20 and 21 through a valid mortgage, extrajudicial foreclosure, and eventual
consolidation proceedings instituted over the said properties.73 The CA went on to
state that there was no doubt as to the validity of the title of Opinion’s
predecessors-in-interest, the Gorospes, because the same was affirmed by the
Supreme Court in a case involving the said properties.74 In contrast, spouses Vilbar’s
TCT No. 36777 does not state the title from which it was derived.75 Spouses Vilbar’s
title becomes even more dubious in light of the aforementioned 2nd Indorsement
issued by the Registry of Deeds of Pasay City, which they failed to refute.76 The CA
further stated that acquisitive prescription will not set in because spouses Vilbar
lacked the prerequisite just title, while the tax declaration is not a conclusive evidence
of ownership.77 As to Lot 20, the CA ratiocinated that the spouses Vilbar never
registered the property in their names despite the lapse of several years, while Opinion
was able to register the same property in his name. Being the registered owner,
Opinion’s title thus takes precedence over the unregistered claim of ownership of
spouses Vilbar.78
Lastly, the CA opined that it is the registration that binds the whole world and that
mere possession of the properties in question cannot defeat the right of Opinion as
registered owner of the property. Since the sale claimed by the spouses Vilbar was
never registered, it cannot bind Opinion.79
The spouses Vilbar moved for reconsideration of the CA Decision which was denied
in a Resolution dated December 22, 2006. Hence, this Petition.
Issues
Petitioners raise the following issues:
A.
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED

IN FINDING THAT THE RESPONDENT ANGELITO OPINION
HAS A BETTER TITLE AND/OR HAS PREFERENCE OVER THE
SUBJECT PROPERTIES IDENTIFIED AS LOTS 20 AND 21.
B.
THE COURT OF APPEALS SERIOUSLY ERRED WHEN IT

OVERLOOKED THE FACT THAT OTILIO GOROSPE, AS
STOCKHOLDER AND CHAIRMAN OF THE BOARD AND CHIEF
EXECUTIVE OFFICER OF DULOS REALTY AND RESPONDENT
OPINION’S PREDECESSOR-IN-INTEREST, ACTED IN BAD
FAITH WHEN HE LEVIED ON EXECUTION AND WHEN HE
PURCHASED IN AN AUCTION SALE THE TWO LOTS SUBJECT
OF THE INSTANT CASE ALREADY SOLD AND DELIVERED TO
THE PETITIONERS BY DULOS REALTY.
C.

WHEN IT OVERLOOKED THE FACT THAT X X X
RESPONDENT OPINION WAS LIKEWISE A PURCHASER IN
BAD FAITH.
D.

WHEN IT OVERLOOKED THAT THE PETITIONERS SPOUSES
VILBAR ARE THE OWNERS OF LOT[S] 21 AND 20 UPON
DELIVERY THEREOF.
E.
THE COURT OF APPEALS ERRED IN ASSUMING THAT TCT

NO. 36777 WAS NOT VALIDLY ISSUED IN FAVOR OF THE
PETITIONERS.80
The pivotal issue to be resolved is: who between the parties has a better right over
Lots 20 and 21?
Petitioners contend that they are the rightful owners and possessors of the contested
properties through a valid sale perfected in 1981. They maintain that Gorospe, Sr., the
predecessor-in-interest of Opinion, did not acquire ownership over Lots 20 and 21
because at the time of the levy and execution, said properties were no longer owned
by Dulos Realty. Gorospe, Sr. could not, therefore, validly pass any rights to Opinion
which the former did not have in the first place.81
Our Ruling
The Court finds no merit in the Petition.

Respondent Opinion’s predecessor-in-
interest is an innocent third party
purchaser in the public auction sale,
absent proof to the contrary.
This Court notes that Dulos Realty, the former owner and common predecessor of the
parties herein, contracted with the spouses Vilbar for the sale and transfer of Lots 20
and 21 on July 10, 1979. As early as August 1979, the spouses Vilbar were already in
peaceful and actual possession of the subject properties and have been exercising acts
of ownership and dominion over their portion of Lot 20 and the entire Lot 21 despite
the fact that the purchase price of the lots have not yet been paid in full. Admittedly,
all these took place before Gorospe, Sr. filed his Complaint for Sum of Money,
Specific Performance and Damages against Dulos Realty on May 12, 1981; prior to
the issuance of the Writ of Execution and Alias Writ of Execution by the trial court on
May 7, 1982 and September 30, 1983, respectively;82 prior to the levy of the
properties of Dulos Realty on October 31, 1984 to answer for the judgment favorable
to Gorospe, Sr. in said collection/specific performance case; and prior to the public
auction sale held on June 24, 1985. However, the Court also notes that the sale of Lot
20 was not annotated on the original title in the name of Dulos Realty, while only a
Contract to Sell was executed between the spouses Vilbar and Dulos Realty as regards
Lot 21 which makes the issuance of the title in the name of Bernadette Vilbar
questionable. What makes spouses Vilbar’s title over Lot 21 even more doubtful is the
2nd Indorsement issued by the Registry of Deeds of Pasay City which states that
Bernadette Vilbar’s title over said lot is presumed to be not validly issued.
The spouses Vilbar contend that Gorospe, Sr. acted in bad faith when he levied on the
disputed properties and bought them at public auction. However, this Court cannot
treat as significant the alleged fact that Gorospe, Sr. was the Chief Executive Officer
and Chairman of the Board of Directors of Dulos Realty at the time the transactions
with the spouses Vilbar were entered into by the company. Evidence on record shows
that the Deed of Absolute Sale dated June 1, 1981 covering Lot 20, as well as the
Contract to Sell over Lot 21, was signed by Juan as President of Dulos Realty. Simply,
spouses Vilbar cannot ascribe bad faith on the part of Gorospe, Sr. absent clear and
convincing proof that he had knowledge of the said spouses’ transactions with the
company. As far as the Court is concerned, the evidence presented shows that
Gorospe, Sr. had no knowledge of the transactions between Dulos Realty and the
spouses Vilbar because it was Juan who executed and signed the documents. More
importantly, the aforementioned Deed of Absolute Sale and Contract to Sell were not
registered and annotated on the original titles in the name of Dulos Realty. Under land
registration laws, the said properties were not encumbered then, and third parties need
only to rely on the face of the duly issued titles. Consequently, the Court finds no bad
faith on Gorospe, Sr.’s part when he bought the properties at public auction free from
liens and encumbrances.
It is worth stressing at this point that bad faith cannot be presumed. "It is a question of
fact that must be proven"83 by clear and convincing evidence. "[T]he burden of
proving bad faith rests on the one alleging it."84 Sadly, spouses Vilbar failed to adduce
the necessary evidence. Thus, this Court finds no error on the part of the CA when it
did not find bad faith on the part of Gorospe, Sr.
Furthermore, the Court recognizes "[t]he settled rule that levy on attachment, duly
registered, takes preference over a prior unregistered sale. This result is a necessary
consequence of the fact that the [properties] involved [were] duly covered by the
Torrens system which works under the fundamental principle that registration is the
operative act which gives validity to the transfer or creates a lien upon the land."85 As
aptly observed by the trial court:
To say the least, there is no reason to doubt that the predecessors-in-interest of the
plaintiff (Opinion) with respect to the said properties, the defendants Gorospes,
likewise acquired the same through lawful means. Indeed, and as acknowledged by
both plaintiff Opinion and defendants Sps. Vilbar, the defendant Dulos Realty
previously owned the above parcels of land under TCT Nos. 39849 and 39850.
However, the said titles were cancelled after the Decision dated 01 April 1982
rendered in favor of defendant Otilio Gorospe, Sr. was implemented or executed.
Consequently, TCT Nos. 117330 and 117331 were issued in the name of defendant
Otilio Gorospe, Sr. Later on, the foregoing titles were cancelled owing to the death of
the wife of defendant Otilio Gorospe, Sr., the late Leonor Gorospe, and TCT Nos.
44796 and 44797 were issued to defendants Gorospes as surviving heirs. These two
titles then became the subject of the mortgage agreement that defendants Gorospes
executed in favor of plaintiff Opinion on 12 January 1995.
The Court notes that when TCT No. 117330 dated 02 June 1987 for Lot 21 in the
name of defendant Otilio Gorospe, Sr. was issued to cancel TCT No. 39850 for the
same lot registered in favor of the defendant Dulos Realty there was no mention
whatsoever that the latter title was already cancelled by TCT No. 36777 supposedly
issued on 22 May 1981 to defendant Bernadette Vilbar. This being so, the subsequent
cancellation of TCT No. 117330 by TCT No. 44796 dated 09 January 1995 for Lot 21
could not be affected by the supposed existence of the title of defendants Spouses
Vilbar.
As to Lot 20, it is also noteworthy that the supposed Deed of Absolute Sale dated 01
June 1981 in favor of defendants Bernadette Vilbar and Guingon was not annotated
on TCT No. 39849. Thus, when this was cancelled by TCT No. 117331 and, later on,
by TCT No. 44797 also dated 09 January 1995, it was not subject to any lien or
encumbrance whatsoever pertaining to the claim of the above defendants over the
same.86 (Emphasis supplied)
In effect, Gorospe, Sr. acquired through lawful means a valid right to the properties,
and he and his son had a legal right to mortgage the same to Opinion. As a
consequence, the Goropes transmitted property rights to Opinion, who, in turn,
acquired valid rights from the Gorospes.
Respondent Opinion is a Buyer in Good Faith.
This Court also treats Opinion as a buyer in good faith. Admittedly, Opinion stated
that prior to the execution of the mortgage, he only went to Lots 20 and 21 once and
saw that the properties had occupants. He likewise admitted that he never talked to the
spouses Vilbar and Guingon to determine the nature of their possession of the
properties, but merely relied on the representation of Gorospe, Sr. that the occupants
were mere tenants. He never bothered to request for any kind of proof, documentary
or otherwise, to confirm this claim. Nevertheless, this Court agrees with the CA that
Opinion is not required to go beyond the Torrens title, viz:
Contrary to the [Spouses Vilbar’s] claim, [Opinion] was never remiss in his duty of
ensuring that the Gorospes had clean title over the property. [Opinion] had even
conducted an investigation. He had, in this regard, no reason not to believe in the
assurance of the Gorospes, more so that the claimed right of [Spouses Vilbar] was
never annotated on the certificate of title covering lot 20, because it is settled that a
party dealing with a registered land does not have to inquire beyond the Certificate of
Title in determining the true owner thereof, and in guarding or protecting his interest,
for all that he has to look into and rely on are the entries in the Certificate of Title.87
Inarguably, Opinion acted in good faith in dealing with the registered owners of the
properties. He relied on the titles presented to him, which were confirmed by the
Registry of Deeds to be authentic, issued in accordance with the law, and without any
liens or encumbrances.88
Besides, assuming arguendo that the Gorospes’ titles to the subject properties
happened to be fraudulent, public policy considers Opinion to still have acquired legal
title as a mortgagee in good faith. As held in Cavite Development Bank v. Spouses
Lim:89
There is, however, a situation where, despite the fact that the mortgagor is not the
owner of the mortgaged property, his title being fraudulent, the mortgage contract and
any foreclosure sale arising therefrom are given effect by reason of public policy. This
is the doctrine of ‘the mortgagee in good faith’ based on the rule that all persons
dealing with property covered by a Torrens Certificate of Title, as buyers or
mortgagees, are not required to go beyond what appears on the face of the title. The
public interest in upholding the indefeasibility of a certificate of title, as evidence of
the lawful ownership of the land or of any encumbrance thereon, protects a buyer or
mortgagee who, in good faith, relied upon what appears on the face of the certificate
of title.90
Respondent Opinion was proven to be in good faith when he dealt with the Gorospes
and relied on the titles presented to him. Spouses Vilbar, on the other hand, failed to
present substantial evidence to prove otherwise.
Proofs of ownership of spouses Vilbar

over Lots 20 and 21 are insufficient to
conclude real ownership, thus, they
cannot be considered as owners of
subject lots.
In support of their claim of ownership, spouses Vilbar presented the following

documentary evidence: (1) Contracts to Sell; (2) Deed of Absolute Sale over Lot 20;
(3) Real Estate Mortgage Agreement with DBP over Lot 21 with reference to the
spouses Vilbar as owners of the said property covered by TCT No. 36777; (4)
Cancellation of Mortgage issued by the DBP in favor of the spouses Vilbar in
connection with Lot 21; (5) various original Official Receipts issued by Dulos Realty
in favor of the spouses Vilbar for installment payments of the purchase price of the
lots in question; (6) various original Official Receipts issued by the DBP in favor of
the spouses Vilbar for payment of loan amortizations; (7) owner’s duplicate copy of
TCT No. 36777 in the name of Bernadette Vilbar; (8) owner’s duplicate copy of TCT
No. S-39849 in the custody of the spouses Vilbar; and, (9) tax declarations and
receipts.
A review of these documents leads the Court to the same inescapable conclusion
reached by the trial court.1âwphi1 With regard to Lot 20, spouses Vilbar brag of a
Deed of Absolute Sale executed by Dulos Realty in their favor and aver that they have
the owner’s copy of TCT No. S-39849 and are presently enjoying actual possession of
said property. However, these are not sufficient proofs of ownership. For some
unknown reasons, the spouses Vilbar did not cause the transfer of the certificate title
in their name, or at the very least, annotate or register such sale in the original title in
the name of Dulos Realty. This, sadly, proved fatal to their cause. Time and time
again, this Court has ruled that "a certificate of title serves as evidence of an
indefeasible and incontrovertible title to the property in favor of the person whose
name appears therein."91 Having no certificate of title issued in their names, spouses
Vilbar have no indefeasible and incontrovertible title over Lot 20 to support their
claim. Further, it is an established rule that "registration is the operative act which
gives validity to the transfer or creates a lien upon the land."92 "Any buyer or
mortgagee of realty covered by a Torrens certificate of title x x x is charged with
notice only of such burdens and claims as are annotated on the title."93 Failing to
annotate the deed for the eventual transfer of title over Lot 20 in their names, the
spouses Vilbar cannot claim a greater right over Opinion, who acquired the property
with clean title in good faith and registered the same in his name by going through the
legally required procedure.
Spouses Vilbar’s possession of the owner’s copy of TCT No. 39849 is of no moment.
It neither cast doubt on Gorospe Sr.’s TCT No. 117331 from which Opinion’s TCT
No. T-59011 covering Lot 20 emanated nor bar Gorospe Sr. from transferring the title
over Lot 20 to his name. It should be recalled that Gorospe Sr. acquired Lots 20 and
21 thru forced sale. Under Section 10794 of Presidential Decree No. 1529,95 Gorospe
Sr. could have the TCTs of said lots cancelled and transferred to his name even if the
previous registered owner (Dulos Realty) refused or neglected to surrender the
owner’s copy thereof. In Valbuena v. Reyes,96 it was held that:
[W]here one acquires a valid deed or title to a property as a result of execution sale,
tax sale, or any sale to enforce a lien, after the expiration of the period, if any, allowed
by law for redemption, when said new owner goes to court and the office of the
register of deeds to have his deed recorded and have a new certificate of title issued in
his name, it is sufficient for purposes of notifying the former owner to surrender his
certificate of title and show cause why it should not be cancelled, that the notification
is effected by mail or by publication as the court may order; and if despite such
notification by mail or by publication, he fails to appear and surrender his certificate
of title, the court may validly order the cancellation of that certificate of title and the
issuance of a new one in favor of the new owner.97
Here, it is clear that Gorospe Sr. was able to secure TCT No. 117331,98 which was
marked as Exhibit "N." Said title explicitly provides that it cancelled TCT No. 39849.
Hence, having been superseded by TCT No. 117331, spouses Vilbar’s possession of
TCT No. 39849 is of no consequence. It may not be amiss to state at this point that
spouses Vilbar’s claim that Dulos Realty conveyed to them Lot 20 on June 1, 1981 is
incongruous with Dulos Realty’s filing of a complaint for reconveyance against
Gorospe Sr. on January 4, 1990. We simply find it difficult to understand why Dulos
Realty would seek recovenyance of Lot 20 from Gorospe Sr. if, indeed, it had already
sold the same almost a decade earlier to spouses Vilbar as evidenced by the latter’s
Deed of Absolute Sale99 dated June 1, 1981. (This complaint docketed as Civil Case
No. 88-2800 though was dismissed for failure to prosecute.)100
With respect to Lot 21, the Court is likewise puzzled as to why spouses Vilbar’s TCT
No. 36777 does not indicate where it came from. The issuance of the said title also
becomes suspect in light of the fact that no Deed of Absolute Sale was ever presented
as basis for the transfer of the title from Dulos Realty. In fact, the spouses Vilbar do
not even know if a Deed of Absolute Sale over Lot 21 was executed in their favor. As
the evidence extant on record stands, only a Contract to Sell which is legally
insufficient to serve as basis for the transfer of title over the property is available. At
most, it affords spouses Vilbar an inchoate right over the property. Absent that
important deed of conveyance over Lot 21 executed between Dulos Realty and the
spouses Vilbar, TCT No. 36777 issued in the name of Bernadette Vilbar cannot be
deemed to have been issued in accordance with the processes required by law. In the
same manner, absent the corresponding inscription or annotation of the required
transfer document in the original title issued in the name of Dulos Realty, third parties
are not charged with notice of said burden and/or claim over the property. The
aforementioned flaws in the title (TCT No. 36777) of spouses Vilbar is aggravated by
the 2nd Indorsement dated May 11, 1988 of the Registry of Deeds of Pasay City
which provides that TCT No. 36777 is presumed not to have been validly issued
considering that no inscription or annotation exists at the back of the original title
(TCT No. S-39850) showing that a deed of sale between Dulos Realty and spouses
Vilbar had been registered, coupled with the established material discrepancies in the
certificate of title in the custody of the Registry of Deeds of Las Piñas City and the
title presented by the spouses Vilbar.
Simply, the spouses Vilbar were not able to present material evidence to prove that
TCT No. 36777 was issued in accordance with the land registration rules.
In addition, the real estate mortgage entered into by the spouses Vilbar with the DBP
does not, by itself, result in a conclusive presumption that they have a valid title to Lot
21. The basic fact remains that there is no proof of conveyance showing how they
acquired ownership over Lot 21 justifying the issuance of the certificate of title in
their name.
With respect to the tax declarations, the trial court aptly declared, thus:
such "indicia" in favor of the defendant Sps. Vilbar had been effectively impugned or
refuted.101
WHEREFORE, the instant Petition for Review on Certiorari is hereby DENIED. The
Decision dated May 26 2006 of he Court of Appeals in CA-G.R CV No. 84409
affirming the Decision dated January 31, 2005 of the Regional Trial Court Branch 255
Las Piñas City in Civil Case No. 98-0302 is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.

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Republic of the Philippines

LUCIA RODRIGUEZ AND G.R. No. 171972

CORONA, C. J., Chairperson,

TERESITA V. SALVADOR, Promulgated:

DEL CASTILLO, J.:

In their Answer,[11] petitioners interposed the defense of agricultural tenancy. Lucia

Ruling of the Municipal Trial Court

Based on the facts presented, it is established that defendant Lucia

Ruling of the Regional Trial Court

Petitioners moved for reconsideration[19] arguing that the purpose of a preliminary

WHEREFORE, the motion for reconsideration is GRANTED. The

Respondent sought reconsideration[22] but it was denied by the RTC in an

Ruling of the Court of Appeals

WHEREFORE, in view of all the foregoing premises, judgment is

Hence, this petition raising the following issues:

The petition lacks merit.

Agricultural tenancy relationship does not

As we have often said, mere occupation or cultivation of an agricultural land will

Respondent is entitled to the fair rental

MARIANO C. DEL CASTILLO

PRESBITERO J. VELASCO, JR. TERESITA J. LEONARDO-DE

JOSE PORTUGAL PEREZ

G.R. No. 176043 January 15, 2014

SPOUSES BERNADETTE and RODULFO VILBAR, Petitioners,

DEL CASTILLO, J.:

On February 13, 1997, Opinion filed a Petition for Issuance of a Writ of

Ruling of the Regional Trial Court

WHEREFORE, the foregoing considered, judgment is hereby rendered in favor of

Aggrieved, the spouses Vilbar appealed to the CA on February 22, 2005.71

Ruling of the Court of Appeals

THE HONORABLE COURT OF APPEALS SERIOUSLY

THE COURT OF APPEALS SERIOUSLY ERRED WHEN IT

THE HONORABLE COURT OF APPEALS SERIOUSLY

THE HONORABLE COURT OF APPEALS SERIOUSLY

THE COURT OF APPEALS ERRED IN ASSUMING THAT TCT

The Court finds no merit in the Petition.

Respondent Opinion is a Buyer in Good Faith.

Proofs of ownership of spouses Vilbar

In support of their claim of ownership, spouses Vilbar presented the following

G.R. No. 201405, August 24, 2015

LIWAYWAY ANDRES, RONNIE ANDRES, AND PABLO B.

DEL CASTILLO, J.:

Petitioners and Liza filed a Complaint4 for Easement of Right-of-Way against

In its Answer,5 respondent denied knowledge of any property adjoining its

During trial, Pablo testified that he bought a 4,000-square meter-portion of the

Ruling of the Regional Trial Court

WHEREFORE, judgment is hereby rendered giving the plaintiffs a

Ruling of the Court of Appeals

Whether petitioners are entitled to demand an easement of right-of-way from

The Petition has no merit.

It must be stressed at the outset that contrary to petitioners' allegations, there is no

Even if timely raised, such argument of petitioners, as well as with respect to

Sifting through petitioners' allegations, it appears that the subject property is an

Republic of the Philippines

ASUNCION URIETA VDA. DE G.R. No. 164402

DEL CASTILLO, J.:

On August 3, 1995, petitioner filed a Complaint for Recovery of Possession and

In her Reply and Answer to Counterclaim,[7] petitioner denied having signed

Ruling of the Regional Trial Court

WHEREFORE, and in the light of all the foregoing considerations,

2. To pay the amount of Ten Thousand Pesos (P10,000.00) as and for

3. To pay the costs of this suit.

Ruling of the Court of Appeals