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Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 157852               December 15, 2010

HEIRS OF DOMINGO VALIENTES, Petitioners,
vs.
Hon. REINERIO (Abraham) B. RAMAS, Acting Presiding Judge, RTC, Branch 29, 9th Judicial Region, San Miguel, Zamboanga del Sur and Vilma V. Minor, Respondents.

D E C I S I O N

LEONARDO-DE CASTRO, J.:

This is a Petition for Certiorari assailing the Decision¹ of the Court of Appeals dated August 16, 2002 and the subsequent Resolution denying reconsideration dated January 16, 2003 in CA-G.R. SP No. 68501.

Petitioners claim that they are the heirs of Domingo Valientes who, before his death, was the owner of a parcel of land in Gabay, Margosatubig, Zamboanga del Sur then covered by Original Certificate of Title (OCT) No. P-18,208 of the Register of Deeds of Zamboanga del Sur. In 1939, Domingo Valientes mortgaged the subject property to secure his loan to the spouses Leon Belen and Brigida Sescon (spouses Belen). In the 1950s, the Valientes family purportedly attempted, but failed, to retrieve the subject property from the spouses Belen. Through an allegedly forged document captioned VENTA DEFINITIVA purporting to be a deed of sale of the subject property between Domingo Valientes and the spouses Belen, the latter obtained Transfer Certificate of Title (TCT) No. T-5,427 in their name. On February 28, 1970, Maria Valientes Bucoy and Vicente Valientes, legitimate children of the late Domingo Valientes, had their Affidavit of Adverse Claim² duly entered in the Memorandum of Encumbrances at the back of TCT No. T-5,427. Upon the death of the spouses Belen, their surviving heirs Brigida Sescon Belen and Maria Lina Belen executed an extra-judicial settlement with partition and sale in favor of private respondent Vilma Valencia-Minor, the present possessor of the subject property.

On June 20, 1979, herein private respondent Minor filed with the then Court of First Instance of Pagadian City a "PETITION FOR CANCELLATION OF MEMORANDUM OF ENCUMBRANCE APPEARING IN TCT NO. T-5,427 OF THE REGISTRY OF DEEDS OF ZAMBOANGA DEL SUR," which was docketed as SPL Case No. 1861.³ On July 31, 2000, the Regional Trial Court (RTC) granted Minor’s prayer to allow the Register of Deeds to have the title to the subject property transferred to her name.

In the meantime, on August 20, 1998, petitioners filed a Complaint before the RTC of San Miguel, Zamboanga del Sur for the "CANCELLATION OF TRANSFER CERTIFICATE OF TITLE NO. T-5,427, RECONVEYANCE, WITH ACCOUNTING, RECEIVERSHIP AND APPLICATION FOR A WRIT OF PRELIMINARY PROHIBITORY INJUNCTION PLUS DAMAGES." The Complaint was docketed as Civil Case No. 98-021.⁴

Private respondent Minor filed an Omnibus Motion to Dismiss Civil Case No. 98-021 on the grounds of forum shopping and litis pendentia. On August 3, 2000, the RTC issued an order in open court ruling that forum shopping does not apply. On September 22, 2000, private respondent Minor filed a Motion for Reconsideration⁵ of the August 3, 2000 Order. On May 7, 2001, the RTC issued an Order granting the Motion for Reconsideration by dismissing Civil Case No. 98-021 on the ground of forum shopping.⁶ Petitioners filed a Motion for Reconsideration⁷ on May 30, 2001, but the same was denied by the RTC in its Order⁸ dated September 18, 2001.

On November 12, 2001, petitioners filed with the Court of Appeals a Petition for Certiorari⁹ assailing the RTC Orders dated May 7, 2001 and September 18, 2001. Petitioners raised the sole issue of whether the trial court was correct in finding that Civil Case No. 98-021 constitutes forum shopping, litis pendentia or res judicata with SPL Case No. 186. The Petition was docketed as CA-G.R. SP No. 68501.

The Court of Appeals rendered its assailed Decision on said petition on August 16, 2002. Despite agreeing with petitioners that there was no forum shopping, litis pendentia or res judicata in the filing of Civil Case No. 98-021, the Court of Appeals, asserting that it has the discretion to review matters not otherwise assigned as errors on appeal if it finds that their consideration is necessary at arriving at a complete and just resolution of the case,¹⁰ held that Civil Case No. 98-021 cannot prosper on the grounds of prescription and laches.

Hence, this Petition for Certiorari, wherein petitioners raised the following grounds for assailing the Court of Appeals’ Decision:

I

THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION WHEN IT APPLIED PRESCRIPTION IN THE PRESENT PETITION, AFTER ALL, WHEN SHE DID NOT APPEAL THE DECISION OF THE HONORABLE REGIONAL TRIAL COURT DISMISSING THE COMPLAINT ON THE SOLE GROUND OF RES JUDICATA, PRIVATE RESPONDENT IS DEEMED TO HAVE ALREADY WAIVED THE DEFENSE OF PRESCRIPTION.

II

THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN DISMISSING THE COMPLAINT ON THE GROUND OF PRESCRIPTION, THE PRESENT ACTION, ALTHOUGH CAPTIONED FOR CANCELLATION OF TRANSFER CERTIFICATE OF TITLE NO. T-5,427, RECONVEYANCE AND ETC., SUBSTANTIALLY, IS FOR QUIETING OF TITLE, HENCE, PRESCRIPTION WILL NOT LIE.

III

THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN APPLYING THE CASES OF TENIO-OBSEQUIO VERSUS COURT OF APPEALS, 330 SCRA 88, AND DECLARO VS. COURT OF APPEALS, 346 SCRA 57 WHEN FACTS OBTAINING IN SAID CASES ARE NOT ATTENDANT IN THE PRESENT CASE FOR CANCELLATION OF TRANSFER CERTIFICATE OF TITLE NO. T-5,427 ON THE GROUND OF FORGERY OR BY REASON OF FORGED DOCUMENT CAPTIONED VENTA DEFINITIVA.

IV

THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION WHEN IT [RENEGED] FROM ITS SOLEMN DUTY TO RENDER SUBSTANTIAL JUSTICE DUE THE PARTIES RATHER THAN THE SANCTIFICATION OF TECHNICAL RULES OR EQUITY ON PRESCRIPTION.¹¹

Authority of the Court of Appeals to Dismiss the Complaint on the Grounds of Prescription and Laches Despite Respondent’s Failure to Appeal the Dismissal Order

Petitioners recount that private respondent Minor interposed prescription as one of her grounds for the dismissal of the case in her Answer with Affirmative Defenses. When private respondent Minor’s Motion to Dismiss was denied by the RTC in open court, she filed a Motion for Reconsideration dwelling on forum shopping, litis pendentia and/or res judicata.¹² The trial court proceeded to dismiss the case on the ground of forum shopping.¹³ Petitioners now claim before us that private respondent Minor’s failure to appeal the RTC’s dismissal of the complaint on the sole ground of forum shopping constituted a waiver of the defense of prescription. Petitioners further argue that the consideration by the Court of Appeals of grounds not assigned as errors in the Appellee’s Brief runs contrary to the precepts of fair play, good taste and estoppel.¹⁴

We rule in favor of private respondent Minor on this issue.

Firstly, it stretches the bounds of credulity for petitioners to argue that a defendant in a case should appeal the dismissal order she prayed for just because other grounds for dismissal were not considered by the court.

Secondly, and more importantly, Section 1, Rule 9 of the Rules of Court provides:

Section 1. Defenses and objections not pleaded. – Defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived. However, when it appears from the pleadings or the evidence on record that the court has no jurisdiction over the subject matter, that there is another action pending between the same parties for the same cause, or that the action is barred by a prior judgment or by statute of limitations, the court shall dismiss the claim.

The second sentence of this provision does not only supply exceptions to the rule that defenses not pleaded either in a motion to dismiss or in the answer are deemed waived, it also allows courts to dismiss cases motu proprio on any of the enumerated grounds – (1) lack of jurisdiction over the subject matter; (2) litis pendentia; (3) res judicata; and (4) prescription – provided that the ground for dismissal is apparent from the pleadings or the evidence on record.

We therefore rule that private respondent Minor cannot be deemed to have waived the defense of prescription, and that the Court of Appeals may consider the same motu proprio. Furthermore, as regards the pronouncement by the Court of Appeals that Civil Case No. 98-021 is likewise heavily infirmed with laches, we rule that the Court of Appeals is not in error when it considered the same motu proprio. While not included in the above enumeration under Section 1, Rule 9 of the Rules of Court, we have ruled in previous cases that laches need not be specifically pleaded and may be considered by the court on its own initiative in determining the rights of the parties.¹⁵

Having thus determined the authority of the Court of Appeals to dismiss the Complaint on the grounds of prescription and laches despite private respondent Minor’s failure to appeal the dismissal Order, We shall now proceed to determine whether or not prescription or laches has already set in to bar the filing of Civil Case No. 98-021.

Imprescriptibility of Quieting of Title

After the Court of Appeals ruled in favor of petitioners on the issue of whether Civil Case No. 98-021 is already barred by forum shopping, res judicata or litis pendentia, the appellate court, nevertheless, affirmed the dismissal order, but on the grounds of prescription and laches:

Be that as it may, this Court is imbued with sufficient discretion to review matters, not otherwise assigned as errors on appeal, if it finds that their consideration is necessary in arriving at a complete and just resolution of the case (Heirs of Ramon Durano, Sr. vs. Uy, 344 SCRA 238).

The case cannot prosper because an action for reconveyance is a legal remedy granted to a landowner whose property has been wrongfully or erroneously registered in another’s name, which must be filed within ten years from the issuance of the title since such issuance operates as a constructive notice (Declaro vs. Court of Appeals, 346 SCRA 57). Where a party has neglected to assert his rights over a property in question for an unreasonably long period, he is estopped from questioning the validity of another person’s title to the property (Ibid.) Long inaction and passivity in asserting one’s rights over a disputed property precludes him from recovering said property (Po Lam vs. Court vs. Court of Appeals, 347 SCRA 86).

In conclusion, petitioners’ cause of action has already prescribed and now heavily infirmed with laches.¹⁶

Petitioners claim that although the complaint was captioned for "CANCELLATION OF TRANSFER CERTIFICATE OF TITLE NO. T-5,427, RECONVEYANCE, WITH ACCOUNTING, RECEIVERSHIP, AND APPLICATION FOR A WRIT OF PRELIMINARY PROHIBITORY INJUNCTION PLUS DAMAGES," the complaint is substantially in the nature of an action to quiet title which allegedly does not prescribe. Petitioners also allege that the cases cited by the Court of Appeals in ruling that prescription has set in, particularly that of Declaro v. Court of Appeals,¹⁷ which in turn cites Tenio-Obsequio v. Court of Appeals,¹⁸ are inapplicable to the case at bar since neither fraud nor forgery was attendant in said cases.

As regards petitioners’ claim that the complaint in Civil Case No. 98-021 is really one of quieting of title which does not prescribe, it appears that petitioners are referring to the doctrine laid down in the often-cited case of Heirs of Jose Olviga v. Court of Appeals,¹⁹ wherein we held:

With regard to the issue of prescription, this Court has ruled a number of times before that an action for reconveyance of a parcel of land based on implied or constructive trust prescribes in ten years, the point of reference being the date of registration of the deed or the date of the issuance of the certificate of title over the property (Vda. de Portugal vs. IAC, 159 SCRA 178). But this rule applies only when the plaintiff is not in possession of the property, since if a person claiming to be the owner thereof is in actual possession of the property, the right to seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe.²⁰

The cause of action of petitioners in Civil Case No. 98-021, wherein they claim that private respondent Minor’s predecessor-in-interest acquired the subject property by forgery, can indeed be considered as that of enforcing an implied trust. In particular, Article 1456 of the Civil Code provides:

Art. 1456. If property is acquired through mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the person from whom the property comes.

However, the Court made a clear distinction in Olviga: when the plaintiff in such action is not in possession of the subject property, the action prescribes in ten years from the date of registration of the deed or the date of the issuance of the certificate of title over the property. When the plaintiff is in possession of the subject property, the action, being in effect that of quieting of title to the property, does not prescribe. In the case at bar, petitioners (who are the plaintiffs in Civil Case No. 98-021) are not in possession of the subject property. Civil Case No. 98-021, if it were to be considered as that of enforcing an implied trust, should have therefore been filed within ten years from the issuance of TCT No. T-5,427 on December 22, 1969. Civil Case No. 98-021 was, however, filed on August 20, 1998, which was way beyond the prescriptive period.

As an alternative argument, petitioners claim that the prescriptive period for filing their complaint is thirty years, pursuant to Article 1141 of the Civil Code, in connection with Articles 1134 and 1137 thereof, which respectively provide:

Art. 1141. Real actions over immovables prescribe after thirty years.

This provision is without prejudice to what is established for the acquisition of ownership and other real rights by prescription.

Art. 1134. Ownership and other real rights over immovable property are acquired by ordinary prescription through possession of ten years.

Art. 1137. Ownership and other real rights over immovables also prescribe through uninterrupted adverse possession thereof for thirty years, without need of title or of good faith.

The theory of petitioners is that the Motion to Dismiss hypothetically admits the allegations of the complaint, including the allegations thereon that the spouses Belen were successful in fraudulently acquiring TCT No. T-5,427 in their favor by means of the forged VENTA DEFINITIVA. Thus, for purposes of ruling on a Motion to Dismiss, it is hypothetically admitted that private respondent Minor’s predecessors-in-interest are in bad faith. The applicable prescriptive period, therefore, is that provided in Article 1141 in relation to Article 1137 of the Civil Code, which is thirty years. Civil Case No. 98-021 was filed on August 20, 1998, 28 years and eight months from the issuance of TCT No. T-5,427 on December 22, 1969.

Articles 1141, 1134 and 1137 of the Civil Code, however, are general rules on prescription which should give way to the special statute on registered lands, Presidential Decree No. 1529, otherwise known as the Property Registration Decree. Under the Torrens System as enshrined in P.D. No. 1529, the decree of registration and the certificate of title issued become incontrovertible upon the expiration of one year from the date of entry of the decree of registration, without prejudice to an action for damages against the applicant or any person responsible for the fraud.²¹

As previously discussed, however, we have allowed actions for reconveyance based on implied trusts even beyond such one-year period, for such actions respect the decree of registration as incontrovertible. We explained this in Walstrom v. Mapa, Jr.²²:

We have ruled before in Amerol vs. Bagumbaran that notwithstanding the irrevocability of the Torrens title already issued in the name of another person, he can still be compelled under the law to reconvey the subject property to the rightful owner. The property registered is deemed to be held in trust for the real owner by the person in whose name it is registered. After all, the Torrens system was not designed to shield and protect one who had committed fraud or misrepresentation and thus holds title in bad faith.

In an action for reconveyance, the decree of registration is respected as incontrovertible. What is sought instead is the transfer of the property, in this case the title thereof, which has been wrongfully or erroneously registered in another person's name, to its rightful and legal owner, or to one with a better right. This is what reconveyance is all about.1avvphi1

Yet, the right to seek reconveyance based on an implied or constructive trust is not absolute nor is it imprescriptible. An action for reconveyance based on an implied or constructive trust must perforce prescribe in ten years from the issuance of the Torrens title over the property.²³

As discussed above, Civil Case No. 98-021 was filed more than 28 years from the issuance of TCT No. T-5,427. This period is unreasonably long for a party seeking to enforce its right to file the appropriate case. Thus, petitioners’ claim that they had not slept on their rights is patently unconvincing.

As a final note, it should be pointed out that in choosing to file a Petition for Certiorari before this Court, petitioners are required to prove nothing less than grave abuse of discretion on the part of the Court of Appeals. We have consistently held that "certiorari will not be issued to cure errors in proceedings or correct erroneous conclusions of law or fact. As long as a court acts within its jurisdiction, any alleged errors committed in the exercise of its jurisdiction will amount to nothing more than errors of judgment which are reviewable by timely appeal and not by a special civil action of certiorari."²⁴ In the case at bar, petitioners proved neither grave abuse of discretion, nor even a simple error of judgment on the part of the Court of Appeals. The present petition should, therefore, fail.

WHEREFORE, the present Petition for Certiorari is DISMISSED. The Decision of the Court of Appeals dated August 16, 2002 and the Resolution dated January 16, 2003 in CA-G.R. SP No. 68501 are AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

TERESITA J. LEONARDO-DE CASTRO
Associate Justice

WE CONCUR:

RENATO C. CORONA
Chief Justice
Chairperson

PRESBITERO J. VELASCO, JR. Associate Justice

MARIANO C. DEL CASTILLO Associate Justice

JOSE PORTUGAL PEREZ
Associate Justice

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the Constitution, I certify 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 Court’s Division.

RENATO C. CORONA
Chief Justice

Footnotes

¹ Rollo, pp. 111-115; penned by Associate Justice Eliezer R. de los Santos with then Acting Presiding Justice Cancio C. Garcia and Associate Justice Marina L. Buzon, concurring.

² CA rollo, pp. 40-41.

³ Id. at 38-39.

⁴ Id. at 30-34.

⁵ Id. at 52-53.

⁶ Id. at 59-61.

⁷ Id. at 62-69.

⁸ Id. at 78-80.

⁹ Id. at 5-22.

¹⁰ Id. at 114.

¹¹ Rollo, pp. 20-21.

¹² CA rollo, pp. 52-53.

¹³ Id. at 59-61.

¹⁴ Rollo, p. 317, Petitioner’s memorandum.

¹⁵ Logronio v. Taleseo, 370 Phil. 907, 918 (1999); Rumarate v. Hernandez, G.R. No. 168222, April 18, 2006, 487 SCRA 317, 335-336.

¹⁶ Rollo, p. 114.

¹⁷ 399 Phil. 616 (2000).

¹⁸ G.R. No. 107967, March 1, 1994, 230 SCRA 550.

¹⁹ G.R. No. 104813, October 21, 1993, 227 SCRA 330.

²⁰ Id. at 334-335.

²¹ Presidential Decree No. 1529, Sections 31 and 32 provide:

Section 31. Decree of registration. - x x x

The decree of registration shall bind the land and quiet title thereto, subject only to such exceptions or liens as may be provided by law. It shall be conclusive upon and against all persons, including the National Government and all branches thereof, whether mentioned by name in the application or notice, the same being included in the general description "To all whom it may concern."

Section 32. Review of decree of registration; Innocent purchaser for value. - The decree of registration shall not be reopened or revised by reason of absence, minority, or other disability of any person adversely affected thereby, nor by any proceeding in any court for reversing judgments, subject, however, to the right of any person, including the government and the branches thereof, deprived of land or of any estate or interest therein by such adjudication or confirmation of title obtained by actual fraud, to file in the proper Court of First Instance a petition for reopening and review of the decree of registration not later than one year from and after the date of the entry of such decree of registration, but in no case shall such petition be entertained by the court where an innocent purchaser for value has acquired the land or an interest therein, whose rights may be prejudiced. Whenever the phrase "innocent purchaser for value" or an equivalent phrase occurs in this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other encumbrancer for value.

Upon the expiration of said period of one year, the decree of registration and the certificate of title issued shall become incontrovertible. Any person aggrieved by such decree of registration in any case may pursue his remedy by action for damages against the applicant or any other persons responsible for the fraud.

²² G.R. No. L-38387, January 29, 1990, 181 SCRA 431.

²³ Id. at 442.

²⁴ Commissioner of Internal Revenue v. Court of Appeals, 327 Phil. 1, 41-42 (1996).

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