G.R. No. L-28901




Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-28901 September 4, 1973 IN RE: APPLICATION FOR REGISTRATION OF LAND TITLE. ALFONSO SANDOVAL, applicant, EMITERIO MINLAY, petitioner, vs. ALFONSO SANDOVAL and ROSA RUIZ, respondents. Osmundo R. Victoriano for petitioner. Tomas Trinidad for respondents. FERNANDO, J.: There would have been no necessity for the appeal from a lower court order of dismissal of a petition for relief from a judgment sustaining an application for registration on the ground of lack of merit had the judge been less precipitate in reaching such a conclusion. Precisely the point raised by petitioner Emiterio Minlay is that applicant Alfonso Sandoval, who with his spouse, Rosa Ruiz, are now appellees, allegedly committed parcel of land, owned and possessed by such petitioner, whose right thereto is that of a homesteader. At the very least then, there should have been a hearing on such an issue. The lower court, however, apparently oblivious of the due process angle, did summarily dispose of the matter without according petitioner the opportunity to sustain his claim. That is the ground of his appeal, and he is entitled to prevail, if only to make clear to lower courts that the constitutional mandate of due process, as has so often been stressed, is a guarantee against manifest unfairness. The antecedents of the case will render clear why the challenged order cannot be sustained. On March 28, 1967, petitioner Minlay filed a verified petition for relief from judgment.1 After setting forth the jurisdictional facts, and that respondent Alfonso Sandoval did, sometime in April, 1966, file an application for the registration of four parcels of land in Antipolo, Rizal,2 he stated therein: "3. That in said application, the said respondent wilfully and falsely made it appear that he is the absolute owner and possessor of the four parcels of land therein described as Lots 1, 2, 3 and 4 of survey Plan Psu-220859, Mayamot, Antipolo, Rizal, and that there are no other persons who have any estate or interest, legal or equitable, over the same, when, in truth and in fact, he was never the owner, nor possessor, of one such parcel of land known as Lot 1, Psu- 220859, because the petitioner herein is the real owner and possessor thereof as described in Paragraph 6 hereof; 4. That on account of the fraud and the suppression of the truth employed by said respondent as described in the immediately preceding paragraph hereof, this Court — not knowing it — rendered in this case a decision, dated November 18, 1966, declaring respondents to be the registered owners of aforementioned parcels of land, including said Lot 1, Plan Psu-220859, and on December 23, 1966, ordered the issuance of the decree of registration; that up to this moment, however, no decree of registration for said parcels of land has been issued and/or entered by the Land Registration Commission and consequently no certificate of title therefore has been issued by the Register of Deeds of Rizal; 5. That petitioner first learned of said decision and of respondent Sandoval's having filed said application for registration only in the month of March, 1967 when, upon oral information, said petitioner checked in the court records and discovered the aforementioned facts concerning the application and decision of the Court; ... ."3 Petitioner then categorically affirmed that he is the absolute owner and possessor of, and therefore did possess irrevocable vested interest, in the "aforementioned Lot 1 of Plan Psu-220859 for the reason that said lot forms a part of said petitioner's Lot 24, Plan Psu-136628, which was originally a public land but to which said petitioner had perfected homestead right long before respondents secured in their favor said decision of November 18, 1966, he having fully complied with all requirements for the acquisition of a homestead and possessed and cultivated the same as his private property continuously up to the present; ... ."4 He likewise attached affidavit showing appellee Sandoval's fraud as well as what he termed is a "good and substantial cause of action."5 After alleging that as far as his knowledge went, there had been transfer to an innocent purchaser for value of such lot No. 1, he prayed for the cancellation and setting aside of the decision insofar as such parcel is concerned, and that, should there any decree or certificate of title having been issued, the same be likewise cancelled and set aside.6 There was, on the part applicants, now appellees, a motion to dismiss such petition filed on April 29, 1967 on the ground that Rule 38 of the Revised Rules of Court was no longer applicable as a decree registration had already been issued with the corresponding certificate of title having been entered in the office of the Register of Deeds.7 In the light of the aforesaid pleading, petitioner filed an opposition thereto on May 11, 1967, admitting that he did not know that a decree of title as well as the corresponding certificate had already been issued as far the disputed lot is concerned, but praying that he be allowed to amend his petition for relief from judgment so that he could seek relief under Section 38 of the Land Registration Act for setting aside such decree on the ground of the actual fraud committed by appellee.8 Then came an order of the lower court dated May 22, 1967, but received by petitioner on May 29, 1967 which reads as follows: "Acting on the motion to dismiss filed by the applicant and the opposition thereto filed by the petitioner for review, the latter is hereby ordered to amend his petition for review so as to conform with the facts in this case that is, the petition should be based on Rule 38 of Act No. 496 and not Section 38 of the Rules of Court."9 Accordingly, the amended petition for review of decree of registration was filed on May 17, 1967. It reiterated the false and fraudulent representation made by appellee Sandoval as to his being the absolute owner and possessor of the four parcels of land when in truth and in fact it was petitioner who is the owner of lot No. 1, he having perfected the homestead right thereto. He prayed, therefore, for the setting aside of the decision as well as the cancellation of the original certificate of title No. 5908 in favor of appellee Sandoval. There was an opposition 10 filed by appellee Sandoval on June 28, 1967 denying the existence of the alleged fraud, and a rejoinder filed on July 1, 1967 to such opposition which was a motion to dismiss on the part of petitioner. It was at this stage that the challenged order dated July 1, 1967 was issued. The crucial portion thereof, the effect of which was the basis for the claim that there was a denial of due process is worded in this wise: "After going over the records of the case, the Court finds no sufficient ground to disturb its findings as contained in its decision that applicant Alfonso Sandoval had complied with all the conditions and requisites essential to a government grant pursuant to the provisions of Subs-section B, Section 48 of Commonwealth Act 141 as amended by Republic Act 1942. Petitioner's claim of having complied with all the requisites of acquiring the homestead patent over said parcel of land cannot prevail over the findings of the Court that the lots involved in this case are private land over which the Director of Lands has no control or authority to cede, transfer, or convey in favor of homestead applicants." 11 The lower court, therefore, not finding any sufficient ground to alter or amend the decision, dismissed such petition for relief from judgment. Hence, this appeal to this Tribunal on the ground that such order of dismissal "is contrary to law." 12 The tone of confidence manifest in the above order of dismissal is misplaced. Petitioner had a right to be heard. Such a right was not respected. Instead, the lower court curtly and summarily disposed of his plea for relief. Clearly, it failed to act according to law. It cannot, therefore, as set forth at outset, be sustained. 1. A decree of registration may be reopened and thereafter set aside on the ground of fraud. So it is provided in Section 38 of the Land Registration Act. 13 From Grey Alba v. De la Cruz, 14 it has been well-settled that the moment there is proof of actual or positive fraud, 15 then the party injured thereby entitled to the statutory remedy. It bears repeating that in appellant's petition for relief from judgment, he specifically alleged that applicant Sandoval "wilfully and falsely made it appear that he is the absolute owner and possessor of ... four parcels of land therein described as Lots 1, 2, 3 and 4 ..., and that there are no other persons who have any estate or interest, legal or equitable, over the same, when, in truth and in fact, was never the owner, nor possessor, of one such parcel of land known as Lot 1, ... because the petitioner herein [now appellant] is the real owner and possessor thereof ... ." 16 Moreover, a succeeding paragraph thereof has this categorical allegation as to his actual possession as well as claim of ownership: "That actually petitioner is the absolute owner and possessor of, and/or the persons having an irrevocable vested interest in, aforementioned Lot 1 of Plan Psu-220859 for the reason that said lot forms a part of said petitioner's Lot 24, Plan Psu-136628, which was originally a public land but to which said petitioner had perfected a homestead right long before respondents secured in their favor said decision of November 18, 1966, he having fully complied with all requirements for the acquisition of a homestead and possessed and cultivated the same as his private property continuously up to the present; ... ." 17 He would therefore seek relief under Section 2 of Rule 38 of the Revised Rules of Court on the ground that it was not until March, 1967, a few days before filing such a petition, that he learned of the aforesaid decisions. It is quite revealing that there was no denial on the part of applicant Sandoval of such facts. His responsive pleading was a motion to dismiss such a petition for relief from judgment on the ground that a decree of registration had already been issued. 18 Since there was an order from the lower court that petitioner should amend his petition for review so that it should be based on Section 38 of the Land Registration Act, 19 there was, on the part of petitioner, an amended petition for review of decree of registration wherein, after reiterating the above allegation of fraud, there is explicit assertion: "That petitioner was not furnished fraud, there is explicit assertion: "That petitioner was not furnished with any notice regarding the filing by respondent Sandoval of said application for registration; ... ." 20 He would seek relief therefore under Section 38 of the Land Registration Act. What is more, there was this express admission on the part of applicant Sandoval in his reiteration of his motion to dismiss "that no personal notice was given to petitioner as they are [not] the known owner of any property; but they are included in the general notice duly published since the action is in rem and binds the whole world." 21 All of which would suffice to indicate the unwarranted deviation from both substantive and procedural norms when the lower court did even deign to hear such petition for setting aside the decree on the ground of fraud. All that is required is a showing according to this leading Grey Alba decision "of intention to deprive another of [his] just rights, " 22 which constitutes "the essential characteristic of actual" 23 fraud. Certainly, it would necessarily follow that who so alleges is entitled to be heard. It is as simple as that. It is worth noting that the Grey Alba decision has been repeatedly cited with approval by this Court. 24 Moreover, there has been a constant flow of decisions adhering to the plain explicit terms of Section 38. 25 One of the above cases, Nicolas v. Director of Lands, 26 should erase any doubt as to the extreme judicial displeasure at this species of fraud of an applicant seeking to include as a part of the property to which title is sought land actually in possession of another. Moreover, because of its relevance, this excerpt from the opinion therein rendered by Justice Paredes is well worth quoting: "It is contended that, in cases of the nature of the case at bar, the only basis for the reopening of the case is actual fraud. There was allegation of actual fraud in the Petition, such as the failure and intentional omission on the part of the respondents to disclose the fact of actual physical possession on the premises by petitioner herein. It is fraud to knowingly omit or conceal a fact, upon which benefit is obtained to the prejudice of a third person (Estiva v. Alvero, 37 Phil. 498). In short, the series of allegations contained in the petition, portions of which are quoted heretofore, describe fraudulent acts, actual and otherwise. Perhaps, the trial judge had reasons to doubt the veracity of the supposed fraudulent acts, attributed to respondents. This doubt, however, should not have been made the basis of dismissal, because if a court doubts the veracity of the allegations in the petition, the best thing it could do would have been to deny the motion to dismiss and proceed with the hearing on the merits, of the petition (De Jesus, et al. v. Belarmino, et al., 50 O.G. p. 3064)." 27 It is to be stressed likewise that the Land Registration Act commands that the applicant, and also the names and addresses of all occupants of the land and of all adjoining owners, if known; and, if known, it shall state what search has been made to find them." 28 What can be clearer, therefore, than that the lower court was not sufficiently mindful of what the law ordains when it refused to hear petitioner on his claim that appellee Sandoval was guilty of fraud in including in his application disputed lot. 2. As set forth in De la Cruz v. Reano, 29 it is an authoritative legal doctrine that a homestead patent issued over a piece land removes it from the public domain. Such a doctrine go back to Manalo v. Lukban, 30 where it was held "that land granted by the Government to a private individual who applied for it as a homestead, is considered no longer registerable within the meaning of the Land Registration Act after the issuance of the homestead patent and the original certificate of title issued in accordance therewith. " 31 The Lukban ruling has been subsequently affirmed, 32 the last two cases being Mabuhay Development Co. v. Ronquillo 33 and Pajomayo v. Manipon. 34 It is true that here, petitioner has not been issued the certificate of title as yet. He is entitled, however, to the benefits of the above controlling doctrine. So it was announced in Balboa v. Farrales, 35 which was quite categorical as to the right of a homesteader. Thus: "The moment the plaintiff had received a certificate from the Government and had done all that was necessary under the law to secure his patent, his right had become vested before the patent was issued." 36 From which, no other conclusion would logically and legally follow except the full recognition of his undisputed property right. As set forth explicitly therein: "A perfected valid appropriation of public lands operates as a withdrawal of the tract from the body of the public domain and, so long as such appropriation remains valid and subsisting, the land covered thereby is deemed private property. A perfected homestead, under the law, is property in the highest sense, which may be sold and conveyed or inherited." 37 The leading case of Balboa v. Farrales has been subsequently affirmed. 38 For the lower court then to predicate the challenged order on the absence of opposition on the part of the Director of Lands is to betray an unmistakable failure to abide by a principle consistently adhered to by this Court. The grave error of the lower court is thus manifest when, under the circumstances disclosed, it would deprive petitioner of his due process right to a hearing. For if he could substantiate his opposition, then clearly the registration thereof could not be binding as to the disputed lot. 3. The right to a hearing embraced in the due process guarantee calls for the utmost respect — especially so in this case. If it were not thus, and the order of dismissal were not set aside, it could happen that the Torrens system would lend itself as an instrument for fraud. So many of the decisions of this Court stand as a warning against such a deplorable consequence. 39 The latest one is Philippine Commercial and Industrial Bank v. Villalva, 40 where it was explicitly affirmed: "Deceit is not to be countenanced; duplicity is not to rewarded. " 41 As early as 1919, in the leading case of Cabanos v. Register of Deeds, 42 Justice Torres did categorically state: "The registration of [land] cannot serve as a protecting mantle to cover and shelter bad faith ... ." 43 There is not any aspect from which this case can then be viewed which does inescapably yield the conclusion that the lower court ought to have granted the opportunity to petitioner to prove his claim accordance with the due process clause. WHEREFORE, the order of July 1, 1967 denying petitioner's amended petition for review of the decree of registration hereby reversed and set aside. The lower court is hereby ordered to continue the proceedings in this case with full unimpeded opportunity for petitioner Emiterio Minlay to be heard on his amended petition for review of the decree of registration. With costs against respondents-appellees. Zaldivar, Castro, Teehankee, Barredo, Makasiar, Antonio and Esguerra, JJ., concur. Makalintal, Actg. C.J., took no part. Footnotes 1 Record on Appeal, p. 2. 2 Ibid, par. 2, p. 3. 3 Ibid, paragraphs 3, 4 and 5, pp. 3-4. 4 Ibid, paragraph 6, p. 4. 5 Ibid, paragraph 7, p. 5. 6 Ibid, Petitory Portion, p. 5. 7 Ibid, Motion to Dismiss Petition for Relief of Judgment, pp. 10-11. 8 Ibid, pp. 12-14. 9 Ibid, Order of the lower court dated May 22, 1967, p. 16. 10 Ibid, pp. 22-29. 11 Ibid, p. 41. 12 Ibid, Notice of Appeal, p. 43. 13 Act No. 496 (1902). Said Section 38 reads thus: "If the court, after hearing finds that the applicant or adverse claimant has title as stated in his application or adverse claim and proper for registration, a decree of confirmation and registration shall be entered. Every decree of registration shall bind the land and quiet title thereto, subject only to exceptions stated in the following section. It shall be conclusive upon and against all persons, including the Insular Government and all the branches thereof, whether mentioned by name in the application, notice, or citation, or included in the general description "To all whom it may concern." Such decree shall not be opened by reason of the absence, infancy, or other disability of any person affected thereby, nor by any proceeding in any court for reversing judgments or decree; subject, however, to the right of any person deprived of land or of any estate or interest therein by decree of registration obtained by fraud to file in the competent Court of First Instance a petition for review within one year after entry of the decree provided no innocent purchaser for value has acquired an interest." 14 17 Phil. 49 (1910). 15 Ibid, p. 57. 16 Record on Appeal, par. 3, p. 3. 17 Ibid. par. 6, p. 4. 18 Ibid, Motion to Dismiss Petition, pp. 10-11. 19 Ibid, Order of May 22, 1967, p. 16. 20 Ibid, par. 5, p. 18. 21 Ibid, Opposition and/or Motion to Dismiss, par. 4, p. 23. 22 Grey Alba v. De la Cruz, 17 Phil. 49, 57 (1910). 23 Ibid. 24 Cf. Roxas v. Enriquez, 29 Phil. 31 (1914); Legarda v. Saleeby, 31 Phil. 590 (1915): Roman Catholic Archbishop of Manila v. Ruiz, 36 Phil. 279 (1917); De los Reyes v. Razon, 38 Phil. 480 (1918); Aquino v. Director of Lands, 39 Phil. 850 (1919); The Government of Philippine Islands v. Abural, 39 Phil. 996 (1919); Sepagan v. Dacillo, 63 Phil. 412 (1936); Sorongon v. Makalintal, 80 Phil. 259 (1948); Sandejas v. Robles, 81 Phil. 421 (1948); Ang Lam v. Rosillosa, 86 Phil. 447 (1950). Alcantara v. Tuazon, 92 Phil. 796 (1953). 25 Cf. Salva v. Salvador, 18 Phil. 193 (1911); Apurado v. Apurado, 26 Phil. 581 (1914); Ruiz v. Lacsamana, 32 Phil. 650 (1915); Reyes v. City of Manila, 38 Phil. 349 (1918); Quimson v. Suarez, 45 Phil. 901 (1924), Ibalez v. Rodriguez, 47 Phil. 554 (1925); Estrellado v. Martinez, 48 Phil. 256 (1925); Jacinto v. Arellano, 48 Phil. 570 (1925); Government v. Tombis-Trino, 50 Phil. 708 (1927); Reyes v. Borbon, Phil. 791 (1927), Tongco v. Vianzon, 50 Phil. 1009 (1927); Cui v. Henson, 51 Phil. 606 (1928); Garcia v. Doncillo, 53 Phil. 682 (1929) Government v. Del Rosario, 54 Phil. 138 (1929); Chozas v. Cruz, 56 Phil. 294 (1931); Velayo Bernardo v. Siojo, 58 Phil. 89 (1933) Government v. Italia, 59 Phil. 712 (1934); Director of Lands v. Aba, 68 Phil. 85 (1939); Cojuangco v. Pablo, 69 Phil. 515 (1940); Sorongon v. Makalintal, 80 Phil. 259 (1948); Azurin v. Quitoriano, 81 Phil. 261 (1948); Raymundo v. Afable, 96 Phil. 655 (1955); Paluay v. Bacudao, 97 Phil. 561 (1955); Bancairen v. Diones, 98 Phil. 122 (1955); J. M. Tuason and Co. v. Santiago, 99 Phil. 615 (1956); Nebrada v. Heirs of Alivio, 104 Phil. 126 (1958); Republic v. Heirs of C. Carle, 105 Phil. 1227 (1959); Tiburcio v. PHHC, 106 Phil. 477 (1959); Tuballa v. de la Cruz, L-13461, March 20, 1961, 1 SCRA 742; Frias v. Esquivel, L-17366, July 31, 1962, 5 SCRA 770; Collado v. Court of Appeals, L-14698, March 30, 1963, 7 SCRA 500; Nicolas v. Director of Lands, L-19147, Dec. 28, 1963, 9 SCRA 934; Director of Lands v. Busuego, L-19090, Dec. 28, 1964, 12 SCRA 678; Baldoz v. Papa, L-18150, July 30, 1965, 14 SCRA 691; People's Homesite v. Mencias, L-24114, Aug. 16, 1967, 20 SCRA 1031; Cagayan v. de los Santos, L-21150, Dec. 26, 1967, 21 SCRA 1348; Rublico v. Orellana, L-26582, Nov. 28, 1969, 30 SCRA 511; Benigna v. Bugas, L-28918, Sept. 29, 1970, 35 SCRA 111; Bolanos v. J.M. Tuason and Co., Inc., L-25894, Jan. 30, 1971, 37 SCRA 223; Lahora v. Dayanghirang, L-21163, May 17, 1972, 45 SCRA 17. 26 L-19147, December 28, 1963, 9 SCRA 934. 27 Ibid, p. 938. 28 Section 21 of Act No. 496 (1902). 29 L-29792, August 31, 1970, 34 SCRA 585. 30 48 Phil. 973 (1924). 31 Ibid, p. 592. 32 Cf. El Hogar Filipino v. Olviga, 60 Phil. 17 (1934); Sideco v. Aznar, 92 Phil. 952 (1953); Eugenio v. Perdido, 97 Phil. 41 (1955); Republic v. Heirs of C. Carle, 105 Phil. 1227 (1959); Samonte v. Sambilon, 107 Phil. 198 (1960); Nieto v. Quines, 110 Phil. 823 (1961). 33 L-24705, April 29, 1971, 38 SCRA 439. 34 L-33676, June 30, 1971, 39 SCRA 676. 35 51 Phil. 498 (1928). 36 Ibid, p. 503. 37 Ibid. 38 Cf. Segovia v. Garcia, 94 Phil. 300 (1954); Corpuz v. Beltran, 97 Phil. 772 (1955): Republic v. Diamonon, 97 Phil. 838 (1955); Benguet Consolidated Mining Co. v. Pineda, 98 Phil. 711 (1956); Roman Catholic Apostolic Adm. of Davao, Inc. v. Land Registration Commission, 102 Phil. 596 (1957); Ingaran v. Ramelo, 107 Phil. 498 (1960); Nieto v. Quines, 110 Phil. 823 (1961); Pineda v. Court of First Instance of Davao, L-12602, April 25, 1961, 1 SCRA 1020. 39 Cf. Quimson v. Suarez, 45 Phil. 901 (1924); Atkins Kroll and Co., Inc. v. Domingo, 46 Phil. 362 (1924); Gustilo v. Maravilla, 48 Phil. 442 (1925); Vargas v. Tancioco, 67 Phil. 308 (1939); Jimenez v. De Castro, 67 Phil. 398 (1939); Parsons Hardware Co., Inc. v. Court of Appeals, 69 Phil. 411 (1940): Palma v. Cristobal, 77 Phil. 712 (1946); Azurin v. Quitoriano, 81 Phil. 261 (1948); Director of Lands v. Martin, 84 Phil. 140 (1949); Manlincon v. De Vera, 86 Phil. 115 (1950); Arceo v. Varela, 89 Phil. 212 (1951); De Lara v. Ayroso, 95 Phil. 185 (1954); Sapto v. Fabiana, 103 Phil. 103 Phil. 683 (1958); Vda. de Carvajal v. Coronado, L-23250, Nov. 12, 1966, 18 SCRA 635; Quiniano v. Court Appeals, L-23024, May 31, 1971, 39 SCRA 221. 40 L-28194, November 24, 1972, 48 SCRA 31. 41 Ibid, p. 39. 42 40 Phil. 620. 43 Ibid, p. 632. The Lawphil Project - Arellano Law Foundation