G.R. No. L-47625




Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-47625 April 14, 1941 AURELIO REYES, petitioner-appellant, vs. EUGENIO EVANGELISTA, oppositor-appellee. Duran and Lim and Sancho Inocencio for appellant. A. Castro Revilla for appellee. LAUREL, J.: This is an appeal from a decision of the Court of First Instance of Manila denying of Aurelio Reyes dated May 31, 1938, praying that, pursuant to section 78 of Act No. 496, an order issue directing Eugenio Evangelista to surrender certificate of title No 50415 for cancellation, or in default thereof, directing its cancellation and the issuance in lieu thereof by the register of deeds of Manila of a new certificate of title in the name of the petitioner. Rufina Leus and Crispulo Leus (sister and brother) were the original registered owners of the two parcels of land (lots Nos. 15 and 16, block 3017 of the cadastral survey of Manila), their title thereto being evidenced by transfer certificate of title No. 32191. On January 4, 1929, Rufina and Crispulo mortgaged the two parcels to the Government of the Philippine Islands, through the Bureau of Lands. The mortgage was registered in the office of the register of deeds of Manila on the 14th day of January, 1929 and on the date of the mortgage and of registration, the property was free from any kind of encumbrance. On June 7, 1932, the Government filed an action to foreclose the mortgage in the Court of First Instance of Manila (civil case No. 42108, entitled "El Gobierno de las Islas Filipinas vs. Rufina Leus y otros.") And on July 26, 1932, decision was rendered ordering defendants to pay jointly and severally to plaintiff the sum of P1,698.47, plus interest on the principal sum of P1,500 at 9 per cent per annum from July 27, 1932, up to the date of payment and costs; and ordering further the sale at public auction in the event of the failure of defendant to pay the amount of the judgment within three months. Defendants therein defaulted, and the Government acquired the land and transfer certificate of title No. 47038 issued in its favor. On February 8, 1935, Eugenio Evangelista applied to the Bureau of Lands for the purchase of the properties thus acquired by the Government and deposited P500. Subsequently, the applicant paid the balance of the purchase price amounting to P1,404. On June 19, 1935, the Government of the Philippine Islands, through the Secretary of Agriculture and Commerce, executed in favor of Evangelista the deeds of sale in consideration of the total sum of P1,904. But because of a suit affecting the land (civil case No. 49562, entitled "La Mancomunidad de Filipinas contra Parsons Hardware Co., Inc. y Rufino Reyes), transfer certificate of title No. 50415, which cancelled Government's title No. 47038, was not issued Evangelista until December 7, 1936. It was on June 6, 1938, that Aurelio Reyes filed a petition in the Court of First Instance of Manila (cadastral case No. 71, G.L.R.O. No. 373) and sought the cancellation of the certificate of title of Eugenio Evangelista and the issuance in lieu thereof of a new certificate of title in his name, alleging that he had acquired the properties involved from the City of Manila at a delinquent tax sale held on May 3, 1937; and that the legal period of redemption having expired, a final deed of conveyance covering the property had been executed in his favor. Evangelista opposed this petition. On January 23, 1939, the lower court denied the petition of Reyes in a resolution, the dispositive part of which reads: Fundado en las consideraciones arriba expuestas, se deniega la peticion del recurrente de fecha 31 de mayo de 1938 debiendo, sin embargo, hacerse constar en el certificado de transferencia de titulo No. 50415, como gravamen que afecta al terreno descrito en el mismo y que ha sido objeto de esta peticion, la suma de ciento veinteseis pesos con quince centavos P126.15) filipinos, pagados por el recurrente a la Ciudad de Manila por amillaramientos debidos de dicho terreno, mas los intereses correspondientes desde la fecha del pago, hasta el reembolso por el recurrido a razon de 15 por ciento al año, de conformidad con el articulo 2499 del Codigo Administrativo. Upon denial of the motion for reconsideration, the case was elevated to the Court of Appeals by bill of exceptions, which court certified the same to this court on the question of law involved. The appellant assigns ten errors in his brief, the most important of which is the first which challenges the jurisdiction of the lower court "to hear and entertain the defenses of appellee Evangelista, which were in the nature of a collateral attack on the validity and regularity of the forfeiture proceedings and sale affected in the city of Manila." It is apparent, however, that while the denial of the petition of Aurelio Reyes in the terms stated in the beginning of this opinion had the effect of upholding the claim of the appellee, Eugenio Evangelista, to the two parcel of land in question described in transfer certificate of title No. 47038 and in subsequent certificate of title No. 50415, we are of the opinion that the lower court, under the provisions of sections 78 and 112 of the Land Registration Act, had the authority to decide, whether or not the cancellation of the title of the appellee and the issuance of a new certificate of title in behalf of the petitioner-appellant, should be granted. The entry of a new certificate authorized by section 78 of the Land Registration Act is not mechanical function of the lower court which, in the nature of things, is empowered to pass upon and determine whether the petition is supported by good and valid reasons. This is also true in relation to the authority given the court under section 112 of the same Act. The lower court denied the petition, and upon the facts found by it, we cannot say that it acted arbitrarily. In upholding the action of the lower court, we have not overlooked the fact that the granting of the petition of Reyes would have meant his acquisition of properties assessed at P3,138 for the sum of P126.15, which is the amount paid by him at the alleged tax sale, notwithstanding the fact that, according to the lower court, delinquency mainly accrued at the time said properties belonged to the Government. From this equitable point of view, we believe that the court below did well in denying the petition. Having reached this conclusion, we do not find it necessary to consider the other errors in the appellant's brief. The order appealed from is hereby affirmed, with costs against the petitioner-appellant. So ordered. Imperial, Diaz, Moran, and Horrilleno, JJ., concur. 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