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G.R. No. 146081 - REPUBLIC OF THE PHILIPPINES v. SPOUSES ROBERTO and MARINA SANCHEZ

G.R. No. 146081 - REPUBLIC OF THE PHILIPPINES v. SPOUSES ROBERTO and MARINA SANCHEZ

PHILIPPINE SUPREME COURT DECISIONS

THIRD DIVISION

[G.R. NO. 146081 : July 17, 2006]

REPUBLIC OF THE PHILIPPINES, Represented by the Land Registration Authority, Petitioner, v. SPOUSES ROBERTO and MARINA SANCHEZ, Respondents.

D E C I S I O N

CARPIO, J.:

The Case

This is a Petition for Review 1 of the Decision2 dated 31 August 2000 and Resolution dated 17 November 2000 of the Court of Appeals. The 31 August 2000 Decision granted the petition of respondent spouses Roberto and Marina Sanchez ("respondents") to set aside the ruling of the Regional Trial Court, Quezon City, Branch 225 ("trial court") in a suit for reconstitution of title. The 17 November 2000 Resolution denied the motion for reconsideration of petitioner Land Registration Authority ("petitioner").

The Facts

On 28 May 1996, respondents filed a petition ("LRC Case No. Q-96-8296") in the trial court to reconstitute the original of Transfer Certificate of Title No. 252708 ("TCT No. 252708"), covering a parcel of land measuring 2,991 square meters ("Lot 1").3 Respondents claimed that TCT No. 252708 was issued in the name of respondent Marina Sanchez ("Marina") by the Register of Deeds, Quezon City. Respondents alleged that the original of TCT No. 252708 was among the documents destroyed by the fire which razed the Office of the Register of Deeds, Quezon City in June 1988. Respondents sought reconstitution under Section 3(a)4 of Republic Act No. 265 ("RA 26") based on Marina's duplicate title.

The trial court scheduled the case for hearing on 15 August 1996. The notice of hearing dated 30 May 1996 was published in the 8 and 15 July 1996 issues of the Official Gazette and posted at the main entrance of the City Hall and the Hall of Justice, Quezon City on 1 July 1996. Petitioner, the Office of the Solicitor General, the Land Management Section, Surveys Division of the Department of Environment and Natural Resources, the Office of the Quezon City Prosecutor, and the Register of Deeds, Quezon City were furnished copies of the notice of hearing.

The Solicitor General filed his Comment to the petition, noting that since the petition is based on Section 3(a) of RA 26, the trial court should defer acting on the petition until the Land Registration Authority (LRA) has submitted its Report on the petition as required under Land Registration Commission (now LRA) Circular No. 35 ("Circular No. 35").6

In response to the Solicitor General's Comment, respondents submitted a Report, dated 5 September 1996 ("First Report"), signed by Benjamin Bustos ("Bustos"), Chief, Reconstitution Division, LRA. The First Report, which was endorsed7 to the trial court in a letter signed by Salvador L. Oriel ("Oriel"), Chief, Docket Division, LRA, reads in full:

REPORT

COMES NOW the Land Registration Authority and to the Honorable Court respectfully reports that:

(1) The present petition seeks the reconstitution of Transfer Certificate of Title No. 252708, allegedly lost or destroyed and supposedly covering Lots 12, 13, 14, 15, & 16 all of Blocks 5, of (LRC) Psd-4786, respectively, on the basis of the owner's duplicate thereof, reproductions of which, not certified by the clerk of Court, as required under LRC circular 35, Series of 1983, were submitted to this Authority.

(2) The technical description of the consolidation of Lots, 12, 13, 14, 15 & 16 all of Block 5, Psd-4786, appearing in the reproduction of Transfer Certificate of Title No. 252708, respectively, have been examined and verified against the technical description on file in the Volume 2753 in the Vault Section Docket Division, this Authority. Said technical description when plotted in the Municipal Index Sheet No. 3669-C do [sic] not appear to overlap previously plotted/decreed properties in the area.

The technical description of Lot 1, Pcn-04-000007 of the cosolidation [sic] of Lots 12, 13, 14, 15 & 16 of Block 5, appearing in the reproductions of Transfer Certificate of Title No. 252708, respectively have been examined and verified against the Lot Description on file in the vault section, Docket Division, this Authority. Said technical descriptions when plotted in the Municipal Index Sheet No. 3669-C do not appear to overlap previously plotted/decreed properties in the area.

WHEREFORE, the foregoing information anent the lots in question is respectfully submitted for consideration in the resolution of the instant petition, and if the Honorable Court, after notice and hearing, finds justification pursuant to Section 15 of the Republic Act No. 26 to grant the same, the owners [sic] duplicate of Transfer Certificate of Title No. 252708 may be used as sources [sic] of the desired reconstitution pursuant to Section 3 (a) of said Act. Provided, however, that in case the petition is granted, the reconstituted title should be made subject to such encumbrances as maybe subsisting, and provided, further, that no certificate of title covering the same parcels of land exists in the office of the Register of Deeds Concerned [sic].

Quezon City, Philippines, September 5, 1996.

REYNALDO Y. MAULIT
Administrator

By:

[Sgd.]

BENJAMIN M. BUSTOS
Reconstituting Officer & Chief,
Reconstitution Division8

As no opposition was filed against the petition, the trial court allowed respondents to present evidence ex parte. Apart from the First Report, respondents also presented a Certification, dated 14 December 1994, of the Quezon City Register of Deeds, that the original of TCT No. 252708 was among those destroyed in the 1988 fire. Respondents further presented a Certification, dated 14 May 1996, of the Office of the City Treasurer, Quezon City, confirming that respondents last paid the real estate taxes on Lot No. 1 in January 1996.

The Ruling of the Trial Court

In its Order dated 28 October 1996 ("28 October 1996 Order"), the trial court granted reconstitution and ordered TCT No. 252708 reconstituted. The 28 October 1996 Order became final on 6 January 1997. The Register of Deeds, Quezon City issued to respondents reconstituted Transfer Certificate of Title No. RT-115027 (252708) ("TCT No. RT-115027").

In a letter dated 4 November 1997, Oriel submitted to the trial court another Report, dated 24 October 1997 ("Second Report"), also signed by Bustos. Oriel informed the trial court that the First Report was fake. The Second Report, which recommended that the trial court set aside the 28 October 1996 Order, reads:

REPORT

COMES NOW the Land Registration Authority, and to the Honorable Court respectfully reports that:

(1) The above-entitled case appears to seek the reconstitution of Transfer Certificate of Title No. 252708 allegedly lost or destroyed and supposedly covering Lot 1, Pcn-04-000007, situated at Quezon City, as indicated in the copy of the Notice of Hearing dated May 30, 1996, submitted to this Authority. Attached also to our records of this case is a xerox copy of the purported Transfer Certificate of Title No. 252708 covering Lot 1, Pcn-04-000007 in the name of Marina Sanchez, not certified by the Clerk of Court, as required under LRC Circular 35, Series of 1983.

(2) In the 1st Indorsement dated October 21, 1997 of Engr. Alberto H. Lingayo, Acting Chief, Ordinary and Cadastral Decree Division, this Authority, xerox copy attached as Annex "A", the following information are stated relative to the above-entitled petition and its enclosures[] to wit:

1. On or about October 1, 1997, a certain Marvin Bautista came to this office to inquire about the above petition, showing a copy of the reconstituted title No. RT-115027 (252708) and a copy of a report purportedly issued by this Authority, xerox copies attached as Annexes "B" & "C";

2. We checked our records and found out that on August 6, 1996, we sent a letter to the Clerk of Court requiring petitioner to submit to this Authority, certain documents, however, petitioner has not yet complied as of this date, hence, we could not have rendered a report, xerox copy attached as Annex "D";

3. On October 2, 1997, we secured from the RTC Branch 225, Quezon City, certified copies of pertinent documents relative to the above-petition and found out that there is indeed a copy of a fake LRA Report, copies attached hereto;

4. Initial verification of the purported TCT No. 252708 reveals that the same is a questionable title, because, among other reasons, the Serial No. 3002163 appearing on the face of the certificate pertains to x x x judicial forms issued to the Registry of Deeds of Manila on January 13, 1976, as per records on file at the Property Section, this Authority; and it overlaps properties covered by TCT Nos. 187042 and 187040 when plotted on our Municipal Index Map.

5. It is suggested that this case be referred to proper authorities for investigation and prosecution of the perpetrators, and that the order of reconstitution rendered by the court be recommended vacated or set aside because it was obtained through fraud and forgery.

WHEREFORE, the foregoing observation anent the lot in question is respectfully submitted for the information and guidance of the Honorable Court, with the recommendation that the order of reconstitution rendered relative to the purported Transfer Certificate of Title No. 252708 be ordered vacated or set aside and the corresponding title that was issued be declared null and void.

That the person[] or persons responsible for the reconstitution of this questionable title be investigated and if evidence warrants be charged or prosecuted in Court.

Quezon City, Philippines, October 24, 1997.

REYNALDO Y. MAULIT
Administrator

By:

[Sgd.]

BENJAMIN M. BUSTOS
Reconstituting Officer & Chief,
Reconstitution Division9

On 24 March 1998, petitioner filed a Manifestation and Motion to set aside the 28 October 1996 Order. Petitioner contended that considering the Second Report, respondents' petition should be considered as having been filed under Section 3(f)10 of RA 26, that is, based on "any other document." Petitioner pointed out that under Section 1311 in relation to Section 1212 of RA 26, the notice of a petition for reconstitution of lost or destroyed titles based on Section 3(f) should not only be published and posted but also served on, among others, the owners of the adjoining properties. For non-compliance with this requirement, the trial court did not acquire jurisdiction over LRC Case No. Q-96-8296.

Respondents opposed petitioner's motion, primarily on the ground that the 28 October 1996 Order had become final.

The heirs of Mario Uy ("Heirs"), whose predecessor-in-interest allegedly owned Lot No. 12 covered by Transfer Certificate of Title No. 187042, filed an "amicus curiae" brief disclosing that they have caused the filing of criminal complaints against respondents for Falsification of TCT No. 252708 (Criminal Case No. 77668) and Use of Falsified Public Document (Criminal Case No. 90649).13 Mario Uy and Maria Corazon Uy-Zalamea ("Zalamea), the latter being the alleged owner of Lot No. 13 covered by TCT No. 187042, had earlier sued respondents in the Regional Trial Court, Quezon City, Branch 227 ("Civil Case No. Q-96-29545") for quieting of title, nullity of [TCT No. 252708], recovery of possession and damages.14

In its Order of 17 July 1998 ("17 July 1998 Resolution"), the trial court set aside the 28 October 1996 Order and dismissed LRC Case No. Q-96-8296. The trial court held:

Records reveal, x x x, that TCT No. 25[2]708, the title to be reconstituted, overlaps TCT Nos. 187040 and 187042. Petitioners' design of having their title reconstituted, notwithstanding the fact that the same is covered in two other titles, eludes the comprehension of this Court.

x x x

The unscrupulous manner by which the petitioners misled the Court is glaring in two (2) instances, to wit: 1) the petition unceremoniously omitted the names of the registered owners of TCT Nos. 187040 and 187042; and 2) the spurious LRA Report submitted by the petitioners.

This Court is of the view that the failure to notify the registered owners of TCT Nos. 187040 and 187042 of the Reconstitution proceeding proved to be a mistake.

Section 13, Republic Act No. 26 x x x provides that "x x x x The Court shall likewise cause a copy of the notice to be sent, by registered mail or otherwise, at the expense of the petitioner, to every person named therein whose address is known, at least thirty days prior to the date of the hearing. Said notice shall state among other things, the number of the lost or destroyed certificate[] of title[,] if known, the name of the registered owner, the name[s] of the occupants or persons in possession of the property, the owner[s] of the adjoining properties and all other interested parties, the location, area and boundaries of the property, and the date on which all persons having any interest therein, must appear and file their claim o[r] objection to the petition. The petitioner shall, at the hearing, submit proof of the publication, posting and service of the notice as directed by the court."

Petitioners' failure to comply with this provision is a fatal defect for the same is mandatory and jurisdictional (Ortigas and Company Limited Partnership v. Velasco, 234 SCRA 435).

When this Court issued the questioned order dated October 28, 1996, it was under the impression that there was no legal impediment for the reconstitution of TCT No. 252708. Had it been apprised at that time that the LRA report submitted by the petitioner was spurious then it would not have issued the same.15 (Italicization in the original)

Respondents sought reconsideration but the trial court denied their motion on 4 January 1999.

Respondents filed a petition for certiorari in the Court of Appeals. The appellate court initially dismissed the petition for respondents' failure to submit a certified true copy or duplicate original of the trial court's 17 July 1998 and 4 January 1999 Resolutions. However, on respondents' motion, the Court of Appeals, without giving due course to the petition, required petitioner and respondents to file Comment and Reply, respectively.

The Ruling of the Court of Appeals

In its Decision of 31 August 2000, the Court of Appeals granted respondents' petition, set aside the trial court's 17 July 1998 and 4 January 1999 Resolutions, and reinstated the 28 October 1996 Order. The appellate court held:

The motion to set aside the [28 October 1996 Order] contemplates a petition for relief from a final order entered against a party in any court through fraud, accident, mistake, or excusable negligence under Rule 38 of the 1997 Rules of Civil Procedure, which must be filed within sixty (60) days after the petitioner learns of the final order, and not more than six (6) months after such final order was entered, and must be accompanied with affidavits showing the fraud, accident, mistake, or excusable negligence relied upon, and the facts constituting the petitioner's good and substantial cause of action or defense, as the case may be.

x x x

As mentioned previously, the LRA, represented by the OSG, contends that notice of the petition should have been served on adjoining landowners as one of the jurisdictional requirements, since the Authentic LRA Report of 24 October 1997 found petitioners' title to be a fake title. However, a mere LRA Report cannot declare a certificate of title spurious without the proper court declaring its nullity and cancellation. A certificate of title cannot be subject to collateral attack and can be altered, modified or cancelled only in a direct proceeding in accordance with law. Incidentally, private respondents filed an action for quieting of title, nullity of title (viz., TCT No. 252708), recovery of possession and damages against petitioners, which is still pending before Branch 227, Regional Trial Court of Quezon City. Until the trial court declares TCT No. 252708 to be void and orders its cancellation, [w]e cannot but recognize the validity of the same. Granting that a suspicion or cloud of doubt was cast on the genuineness and authenticity of petitioners' certificate of title, the same was brought to the fore belatedly. A Certificate of Finality had already been issued on 06 January 1997. Presumably, the proper parties received a copy of the Order dated 28 October 1996 on or before 21 December 1996. Entry of Judgment having been made on 06 January 1997, a petition for relief from judgment should have been filed on or before 05 July 1997. The Manifestation and Motion was only filed on 24 March 1998, long after the order of reconstitution had become final and a reconstituted title actually issued petitioners. There having been no sufficient evidence to discredit petitioners' duplicate of the certificate of title within the time to appeal, move for new trial or file a petition for relief, there is no need to serve notice of the petition on the adjoining landowners under Section 13 of RA No. 26. Said section applies only when the source of reconstitution is other than the owner's duplicate of the certificate of title. x x x xThus, at the time the Order of 28 October 1996 was rendered, respondent court was properly clothed with jurisdiction. After said order became final, and the petition for relief having been foreclosed against aggrieved parties, respondent judge was without jurisdiction to entertain the attack against the order of reconstitution. x x x x

Moreover, it must be remembered that the fallo of the Decision dated 28 October 1996 contains a caveat, i.e., "provided, however, that no certificate of title covering the same parcel of land exists in the office of the Register of Deeds." The reconstituted title issued petitioners militates against any doubt or suspicion cast on their title. The Registrar of Deeds concerned would not have issued a reconstituted title had the land covered by TCT No. 252708 already been covered by another certificate of title. Thus, [w]e reiterate, until Branch 227, Regional Trial Court of Quezon City declares TCT No. 252708 to be void and orders its cancellation, [w]e cannot but recognize the validity of the same.

The allegation of fraud requires a higher burden of persuasion, but this Court maintains that the reconstitution proceeding, which has now become final, is not the proper forum to thresh out the same. It is a fundamental rule that when a final judgment becomes executory, it thereby becomes immutable and unalterable and any amendment or alteration which substantially affects a final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose. Thus, it is as if no Manifestation and Motion was filed and no suspicion or cloud of doubt was cast on the genuineness and authenticity of petitioners' certificate of title by the presentation of the LRA Report of 24 October 1997.16

Petitioner sought reconsideration but the appellate court denied its motion in the Resolution of 17 November 2000.

Hence, this petition. Petitioner reiterates its claim that the trial court did not acquire jurisdiction over LRC Case No. Q-96-8296 for lack of actual notice to all interested parties as required under Section 13 in relation to Section 12 of RA 26.

In their Comment, respondents countered that the actual notice requirement in Section 13 does not apply to LRC Case No. Q-96-8296 because that case was based on Marina's duplicate copy of TCT No. 252708. At any rate, respondents contended that it is the posting and publication of the notice of hearing, not its actual service, which vests jurisdiction to the trial court, citing our ruling in Calalang v. Register of Deeds of Quezon City.17 Lastly, respondents maintained that the 28 October 1996 Order is already final and can no longer be set aside.

The Issue

The question is whether the trial court acquired jurisdiction over LRC Case No. Q-96-8296.

The Ruling of the Court

We hold in the negative and accordingly grant the petition.

The Actual Notice Requirement under Section 13 in Relation
to Section 12 of RA 26 Applies Here

Respondents are correct in saying that the service of notice of the petition for reconstitution filed under RA 26 to the occupants of the property, owners of the adjoining properties, and all persons who may have any interest in the property is not required if the petition is based on the owner's duplicate certificate of title or on that of the co-owner's, mortgagee's, or lessee's. This was our ruling in Puzon v. Sta Lucia Realty and Development, Inc.,18 involving a petition filed with the Regional Trial Court of Quezon City, Branch 80, ("Branch 80") for reconstitution of the original of two Torrens certificates of title based on Puzon's duplicate certificates of title. We held in that case:

[T]he first sentence of Section 13 provides that the requirements therein pertain only to petitions for reconstitution filed under "the preceding section," Section 12, which in turn governs those petitions based on specified sources. We quote Section 12 below:

"SEC. 12. Petition for reconstitution from sources enumerated in Section 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and/or 3(f) of this Act, shall be filed with the proper Court of First Instance, by the registered owner, his assigns, or any person having an interest in the property. The petition shall state or contain, among other things, the following: x x x (e) the name and addresses of the occupants or persons in possession of the property, of the owners of the adjoining properties and of all persons who may have interest in the property; x x x x All the documents, or authenticated copies thereof, to be introduced in evidence in support to the petition for reconstitution shall be attached thereto and filed with the same: Provided, That in case the reconstitution is to be made exclusively from sources enumerated in Section 2(f) or 3(f) of this Act, the petition shall be further accompanied with a plan and technical description of the property duly approved by the Commissioner of Land Registration, or with a certified copy of the description taken from a prior certificate of title covering the same property."

In other words, the requirements under Sections 12 and 13 do not apply to all petitions for judicial reconstitution, but only to those based on any of the sources specified in Section 12, that is, "sources enumerated in Section 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and/or 3(f) of this Act."

Sections 2 and 3 of RA 26 provide as follows:

"SEC. 2. Original certificates of title shall be reconstituted from such of the sources hereunder enumerated as may be available, in the following order:

(a) The owner's duplicate of the certificate of title;

(b) The co-owner's, mortgagee's, or lessee's duplicate of the certificate of title;

(c) A certified copy of the certificate of title, previously issued by the register of deeds or by a legal custodian thereof;

(d) An authenticated copy of the decree of registration or patent, as the case may be, pursuant to which the original certificate of title was issued;

(e) A document, on file in the registry of deeds, by which the property, the description of which is given in said document, is mortgaged, leased or encumbered, or an authenticated copy of said document showing that its original had been registered; andcralawlibrary

(f) Any other document which, in the judgment of the court, is sufficient and proper basis for reconstituting the lost or destroyed certificate of title.

"SEC. 3. Transfer certificates of title shall be reconstituted from such of the sources hereunder enumerated as may be available, in the following order:

(a) The owner's duplicate of the certificate of title;

(b) The co-owner's, mortgagee's or lessee's duplicate of the certificate of title;

(c) A certified copy of the certificate of title, previously issued by the register of deeds or by a legal custodian thereof;

(d) The deed of transfer or other document on file in the registry of deeds, containing the description of the property, or an authenticated copy thereof, showing that its original had been registered, and pursuant to which the lost or destroyed transfer certificate of title was issued;

(e) A document, on file in the registry of deeds, by which the property the description of which is given in said documents, is mortgaged, leased or encumbered, or an authenticated copy of said document showing that its original had been registered; andcralawlibrary

(f) Any other document[] which, in the judgment of the court, is sufficient and proper basis for reconstituting the lost or destroyed certificate of title." x x x

In the present case, the source of the Petition for the reconstitution of title was petitioner's duplicate copies of the two TCTs mentioned in Section 3(a). Clearly, the Petition is governed, not by Sections 12 and 13, but by Section 10 of RA 26. We quote said Section 10 in full:

"SEC. 10. Nothing hereinabove provided shall prevent any registered owner or person in interest from filing the petition mentioned in Section Five of this Act directly with the proper Court of First Instance, based on sources enumerated in Section 2(a), 2(b), 3(a), 3(b), and/or 4(a) of this Act: Provided, however, That the Court shall cause a notice of the petition, before hearing and granting the same, to be published in the manner stated in Section Nine hereof: And provided, further, That certificates of title reconstituted pursuant to this section shall not be subject to the encumbrance referred to in Section Seven of this Act."

Nothing in this provision requires that notices be sent to owners of adjoining lots. Verily, that requirement is found in Section 13, which does not apply to petitions based on an existing owner's duplicate TCT.

Put differently, Sections 9 and 10 of RA 26 require that 30 days before the date of hearing, (1) a notice be published in two successive issues of the Official Gazette at the expense of the petitioner, and (2) such notice be posted at the main entrances of the provincial building and of the municipal hall where the property is located. The notice shall state the following: (1) the number of the certificate of title, (2) the name of the registered owner, (3) the names of the interested parties appearing in the reconstituted certificate of title, (4) the location of the property, and (5) the date on which all persons having an interest in the property, must appear and file such claims as they may have.

For petitions based on sources enumerated in Sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e) and 3(f), Section 13 adds another requirement: that the notice be mailed to occupants, owners of adjoining lots, and all other persons who may have an interest in the property. To repeat, mailing the notice is not required for a petition based on Sections 2(a), 2(b), 3(a), 3(b) and 4(a), as in the present case.

x x x

[T]here is no question that in [petitions for] reconstitution involving Sections 12 and 13 of RA 26], notices to adjoining owners and to the actual occupants of the land are mandatory and jurisdictional. But in petitions for reconstitution falling under Sections 9 and 10 of RA 26 where, as in the present case, the source is the owner's duplicate copy, notices to adjoining owners and to actual occupants of the land are not required. When the law is clear, the mandate of the courts is simply to apply it, not to interpret or to speculate on it.

In sum, RA 26 separates petitions for reconstitution of lost or destroyed certificates of title into two main groups with two different requirements and procedures. Sources enumerated in Sections 2(a), 2(b), 3(a), 3(b), and 4(a) of RA 26 are lumped under one group (Group A); and sources enumerated in Sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and 3(f) are placed together under another group (Group B). For Group A, the requirements for judicial reconstitution are set forth in Section 10 in relation to Section 9 of RA 26; while for Group B, the requirements are in Sections 12 and 13 of the same law.19 (Italicization in the original; boldfacing supplied)

However, contrary to respondents' claim, Puzon finds no application here. No report from a pertinent government agency challenging the authenticity of Puzon's duplicate certificates of title was presented in Puzon. Thus, when Branch 80 granted reconstitution, Puzon's duplicate transfer certificates of title remained unchallenged.20

In contrast, the trial court in the present case was misled into treating LRC Case No. Q-96-8296 as having been filed under Section 3(a) based on Marina's purported duplicate title. Thus, the trial court followed Section 1021 in connection with Section 922 of RA 26 to publicize LRC Case No. Q-96-8296. Relying on the First Report's finding that TCT No. 252708 "do[es] not appear to overlap previously plotted/decreed properties in the area," the trial court granted reconstitution. However, petitioner later informed the trial court of the First Report's spuriousness, the serious doubts on TCT No. 252708's authenticity, and the existence of two other titles that overlapped Lot No. 1. After hearing the parties, the trial court dismissed LRC Case No. Q-96-8296 for lack of jurisdiction as all interested parties were not actually notified of the petition as required under Section 13 in relation to Section 12 of RA 26.

We hold that the trial court did not commit grave abuse of discretion.

We were faced with substantially the same situation in Director of Lands v. Court of Appeals.23 In that case, the petition for reconstitution, as in the present case, was filed under Section 3(a) of RA 26 based on an alleged owner's duplicate certificate of title. However, the Director of Lands, in an adverse Report, challenged the authenticity of the purported duplicate certificate of title. The trial court denied reconstitution but the Court of Appeals reversed the trial court's ruling. Upon further review, we reversed the Court of Appeals and dismissed the reconstitution petition. We held that with the Director of Lands' Report, the petition for reconstitution "falls squarely" under Section 3(f) of RA 26, thus:

In the instant case, the change in the number of the certificate of title sought to be reconstituted from T-12/79 to TCT No. 42449 rendered at once the authenticity or genuineness of respondent's certificate of title under suspicion or cloud of doubt. And since respondent alleges that the technical descriptions under both certificates of title are identical and the same, x x x, We hold that the instant petition for judicial reconstitution falls squarely under Section 3(f), Republic Act No. 26, because the Director of Lands claims that the respondent's duplicate of the Certificate of Title No. T-12/79 or TCT No. 42449 are [sic] both fake and fictitious.24 (Emphasis supplied)cralawlibrary

Consequently, we applied Sections 12 and 13 of RA 26 and held that for non-compliance with these provisions, the trial court did not acquire jurisdiction over the petition for reconstitution.

Contrary to the Court of Appeals' finding, the Second Report is not a "collateral attack" on TCT No. 252708. Circular No. 35 requires the submission of an LRA Report in all proceedings to judicially reconstitute lost or destroyed Torrens certificates of title.25 Indeed, to "x x x prevent duplication of titles, x x x and [the] irregular reconstitution of lost or destroyed land certificates of title based on unauthorized sources," this Court issued Administrative Circular No. 7-96 ("Circular 7-96") on 15 July 1996 reminding trial court judges and clerks of courts "under pain of disciplinary sanctions, x x x to comply strictly" with, among others, Circular No. 35. Trial courts hearing reconstitution petitions under RA 26 are thus duty-bound to take into account the LRA's Report. When the trial court considered the authentic Second Report in issuing the 17 July 1998 Resolution, it merely complied with Circular 7-96.

True, petitioner submitted the Second Report after the period to appeal, or seek relief against, the 28 October 1996 Order had lapsed. However, this is no bar for the trial court to consider the Second Report. Petitioner was not at fault when it did not submit its Report before the trial court resolved LRC Case No. Q-96-8296. Petitioner explained that respondents failed to submit the documents petitioner had requested in its letter of 6 August 1996. But more than this, courts have inherent power to

correct fatal infirmities in its proceedings,26 especially if, as here, the flaw was intentionally brought about by a party who employed deceit in misleading the trial court. To hold otherwise would render courts helpless in maintaining the integrity of its proceedings and correspondingly embolden parties to make a mockery of judicial rules. The trial court merely exercised such inherent power in the higher interest of justice.27

The issuance by the Register of Deeds of Quezon City of TCT No. RT-115027 does not erase the doubts the Second Report raises on the authenticity of TCT No. 252708. Nor does it negate the existence of TCT Nos. 187040 and 187042. Paragraph 12 of Circular No. 35 requires that the Register of Deeds shall submit "written findings" on the status of the title sought to be reconstituted.28 No such "written findings" exist in the records of this case. What respondents submitted was a Certification dated 14 December 1994 that the original of TCT No. 252708 was among those destroyed in the 1988 fire. This falls short of what paragraph 12 of Circular 35 requires.

Consequently, it is Section 13 in relation to Section 12 of RA 26 which applies to LRC Case No. Q-96-8296. Hence, in addition to its posting and publication, the notice of hearing of LRC Case No. Q-96-8296 should also have been served through mail on the owners of the adjoining properties and all persons who may have any interest in the property.29 The records show that neither Lot No. 1's adjoining owners30 nor the other interested parties, namely, Mario Uy and Maria Corazon Uy-Zalamea ("Uy

and Zalamea"), in whose names TCT Nos. 187042 and 187040 were issued, were notified of respondents' petition in LRC Case No. Q-96-8296.31

The Actual Notice Requirement in Section 13 in
Relation to Section 12, RA 26 is Jurisdictional

That the requirement of actual notice in Section 13 in relation to Section 12 of RA 26 is jurisdictional was settled in Director of Lands v. Court of Appeals where we held:

To ascertain whether a court has jurisdiction or not, the provisions of the law should be inquired into (Auyong v. Hon. Court of Tax Appeals, L-25181, Jan. 11, 1967, 19 SCRA 10). In all cases where the authority of the courts to proceed is conferred by a statute and when the manner of obtaining jurisdiction is mandatory and must strictly be complied with, or the proceedings will be utterly void (Caltex, et al. v. CIR, et al., L-28472, April 30, 1968, 23 SCRA 492). So that where there is defect of publication of petition, such defect deprives the court of jurisdiction (Po v. Republic, L-27443, July 19, 1971, 40 SCRA 37). And when the court a quo lacks jurisdiction to take cognizance of a case, the same lacks authority over the whole case and all its aspects (Development Bank of the Phils. Employees Union v. Juan Perez, L-22584 and L-23083, May 30, 1972, 45 SCRA 179, 187). Further, absent jurisdiction the court cannot pass upon the merits of the petition (Pinza v. Aldovino, 25 SCRA 220, 224).

In the case at bar, the jurisdiction or authority of the Court of First Instance is conferred upon it by Republic Act 26 entitled "An Act providing a special procedure for the reconstitution of Torrens Certificates of Title lost or destroyed," approved on September 25, 1946. The Act specifically provides the special requirements and mode of procedure that must be followed before the court can act on the petition and grant to the petitioner the remedy sought for. These requirements and procedure are mandatory. The petition for reconstitution must allege the jurisdictional facts; the notice of hearing must also be published and posted in particular places and the same sent to specified persons. Specifically, the requirements and procedure are set forth in detail under Sections 12 and 13 of the Act [.] x x x x32 (Emphasis supplied)cralawlibrary

On the particular requirement of service of notice to all interested parties, we held in the earlier case of Manila Railroad Company v. Moya:

It is clear from section 13 of Republic Act No. 26 that notice by publication is not sufficient under the circumstances. Notice must be actually sent or delivered to parties affected by the petition for reconstitution. The order of reconstitution, therefore, having been issued without compliance with the said requirement, has never become final as it was null and void. The Manila Railroad cannot then complain that the motion to set aside was filed beyond the reglementary period.33 (Emphasis supplied)cralawlibrary

We have since reiterated this ruling in Ortigas & Company Limited Partnership v. Velasco34 andPuzon.

Respondents erroneously invoke Calalang as authority for their claim that it is only the publication and posting of the notice of hearing which are mandatory. The question of whether the actual notice requirement in Section 13 in relation to Section 12 of RA 26 is mandatory and jurisdictional was not the main issue in that case - it was whether the petitioners were bound by our ruling in De la Cruz v. De la Cruz,35 affirming the validity of a Torrens certificate of title issued to one who had obtained the property covered by the title through a conveyance duly recorded in the Register of Deeds of Quezon City and who had the title subsequently reconstituted. We answered in the affirmative and dismissed the petitions principally on the ground of res judicata.36 Notably, we found in Calalang that the predecessor-in-interest of the petitioners did not own the disputed property, thus the latter could not claim any better right than the former.

For non-compliance with the actual notice requirement in Section 13 in relation to Section 12 of RA 26, the trial court did not acquire jurisdiction over LRC Case No. Q-96-8296. The proceedings in that case were thus a nullity and the 28 October 1996 Order was void.

Void Rulings Subject to Challenge at any Time

In MWSS v. Sison, also involving a motion to set aside a "final" reconstitution order for non-compliance with Section 13 of RA 26, we laid down the attributes of a void judgment or ruling:

x x x a void judgment is not entitled to the respect accorded to a valid judgment, but may be entirely disregarded or declared inoperative by any tribunal in which effect is sought to be given to it. It is attended by none of the consequences of a valid adjudication. It has no legal or binding effect or efficacy for any purpose or at any place. It cannot affect, impair or create rights. It is not entitled to enforcement and is, ordinarily, no protection to those who seek to enforce. All proceedings founded on the void judgment are themselves regarded as invalid. In other words, a void judgment is regarded as a nullity, and the situation is the same as it would be if there were no judgment. It, accordingly, leaves the parties litigants in the same position they were in before the trial.37

Guided by this rule, we had set aside so-called "final" reconstitution Orders for being void for non-compliance with Section 13 of RA 26 where the Orders were challenged either through a motion filed in the trial court issuing the reconstitution order38 or through a petition under Rule 47 of the Rules of Court filed with the Court of Appeals.39 Here, petitioner availed of the former remedy.40

However, a modification in the disposition of LRC Case No. Q-96-8296 is in order. In its 17 July 1998 Resolution, the trial court set aside the 28 October 1996 and dismissed LRC Case No. Q-96-8296. At that time, however, the Register of Deeds, Quezon City had already issued reconstituted TCT No. RT-115027. That title must similarly be set aside, emanating as it did from a void ruling.

A Final Word

Reconstitution proceedings under RA 26 has for their purpose the restoration in the original form and condition of a lost or destroyed instrument attesting the title of a person to a piece of land.41 Thus, reconstitution must be granted only upon clear proof that the title sought to be restored was indeed issued to the petitioner. Strict observance of this rule is vital to prevent parties from exploiting reconstitution proceedings as a quick but illegal way to obtain Torrens certificates of titles over parcels of land which turn out to be already covered by existing titles.42 The social and economic costs of such modus operandi cannot be underestimated.43 Asweobserved in Director of Lands v. Court of Appeals:

The efficacy and integrity of the Torrens System must be protected and preserved to ensure the stability and security of land titles for otherwise land ownership in the country would be rendered erratic and restless and can certainly be a potent and veritable cause of social unrest and agrarian agitation. x x x x The real purpose of the Torrens System which is to quiet title to the land must be upheld and defended, and once a title is registered, the owner may rest secure, without the necessity of waiting in the portals of the court or sitting in the mirador de su casa to avoid the possibility of losing his land.44

WHEREFORE, we GRANT the petition. We SET ASIDE the Decision dated 31 August 2000 and the Resolution dated 17 November 2000 of the Court of Appeals. We ENTER a new judgment declaring the reconstitution proceedings in LRC Case No. Q-96-8296 VOID for lack of jurisdiction. Accordingly, we declare VOID the Order dated 28 October 1996 of the Regional Trial Court of Quezon City, Branch 225 and the reconstituted Transfer Certificate of Title No. RT-115027 (252708). We direct the Register of Deeds of Quezon City to CANCEL Transfer Certificate of Title No. RT-115027 (252708).

Let a copy of this ruling be served on the Register of Deeds, Quezon City.

SO ORDERED.

Quisumbing, Chairperson, Carpio-Morales, Tinga, Velasco, Jr., JJ., concur.

Endnotes:


1 Under Rule 45 of the 1997 Rules of Civil Procedure.

2 Penned by Associate Justice Romeo A. Brawner with Associate Justices Quirino D. Abad Santos, Jr., and Andres B. Reyes, Jr., concurring.

3 The technical description of the property reads in part: "Lot No. 1, Pcn-04-000007, x x x, being a [b]oundary of th`e consolidation of Lots 12, 13, 14, 15, & 16, all of Block 5, (LRC) Psd-4786, LRC (GLRO) Rec. No. 5975[.]" (Records, p. 5)

4 "Transfer certificates of title shall be reconstituted from such of the sources hereunder enumerated as may be available, in the following order:

(a) The owner's duplicate of the certificate of title;

x x x x"

5 "An Act Providing A Special Procedure for the Reconstitution of Torrens CertificateS of Title Lost or Destroyed," approved on 25 September 1946.

6 "Supplemental Rules and Regulations Governing the Reconstitution of Lost or Destroyed Land Certificate of Title," dated 13 June 1983.

7 The endorsement, dated 5 September 1996, erroneously indicated the date of the First Report as 20 August 1996.

8 Records, p. 25.

9 Id. at 52-53. (Emphasis supplied)cralawlibrary

10 "Transfer certificates of title shall be reconstituted from such of the sources hereunder enumerated as may be available, in the following order:

x x x

(f) Any other document, which, in the judgment of the court, is sufficient and proper basis for reconstituting the lost or destroyed certificate of title."

11 "The court shall cause a notice of the petition, filed under the preceding section, to be published, at the expense of the petitioner, twice in successive issues of the Official Gazette, and to be posted on the main entrance of the provincial building and of the municipal building of the municipality or city in which the land is situated, at least thirty days prior to the date of hearing. The court shall likewise cause a copy of the notice to be sent, by registered mail or otherwise, at the expense of the petitioner, to every person named therein whose address is known, at least thirty days prior to the date of hearing. Said notice shall state, among other things, the number of the lost or destroyed certificate of title, if known, the name of the registered owner, the names of the occupants or persons in possession of the property, the owners of the adjoining properties and all other interested parties, the location, area and boundaries of the property, and the date on which all persons having any interest therein, must appear and file their claim or objections to the petition. The petitioner shall, at the hearing, submit proof of the publication, posting and service of the notice as directed by the court." (Emphasis supplied)cralawlibrary

12 "Petitions for reconstitution from sources enumerated in Sections 2(c), 2(d), 2(e), 2(f), 3(c), 3(d), 3(e), and/or 3(f) of this Act, shall be filed with the proper Court of First Instance, by the registered owner, his assigns, or any person having an interest in the property. The petition shall state or contain, among other things, the following: (a) that the owner's duplicate of the certificate of title had been lost or destroyed; (b) that no co-owner's, mortgagee's or lessee's duplicate had been issued, or, if any had been issued, the same had been lost or destroyed; (c) the location, area and boundaries of the property; (d) the nature and description of the buildings or improvements, if any, which do not belong to the owner of the land, and the names and addresses of the owners of such buildings or improvements; (e) the names and addresses of the occupants or persons in possession of the property, of the owners of the adjoining properties and of all persons who may have any interest in the property; (f) a detailed description of the encumbrances, if any, affecting the property; and (g) a statement that no deeds or other instruments affecting the property have been presented for registration, or, if there be any, the registration thereof has not been accomplished, as yet. All the documents, or authenticated copies thereof, to be introduced in evidence in support of the petition for reconstitution shall be attached thereto and filed with the same: Provided, That in case the reconstitution is to be made exclusively from sources enumerated in Sections 2(f) or 3(f) of this Act, the petition shall be further accompanied with a plan and technical description of the property duly approved by the Chief of the General Land Registration Office, or with a certified copy of the description taken from a prior certificate of title covering the same property." (Emphasis supplied)cralawlibrary

13 The Metropolitan Trial Court in Cities of Metro Manila, Branch 32, dismissed Criminal Case No. 90649 on 12 February 2001 because of the desistance of the private complainant, one Juanita Uy Tirona (rollo, p. 659).

14 The Heirs also filed a petition in the Court of Appeals in CA G.R. SP No. 48322 to annul the 28 October 1996 Order but the Court of Appeals dismissed the petition for lack of affidavit of merit and for non-disclosure of Civil Case No. Q-96-29545.

15 Records, pp. 117-118.

16 Rollo, pp.159-161.

17 G.R. No. 76265, 11 March 1994, 231 SCRA 88.

18 G.R. No. 139518, 6 March 2001, 353 SCRA 699.

19 Id. at 699, 705-709.

20 It was only two years after Branch 80 rendered judgment granting reconstitution on 11 February 1994, that the LRA, on 29 March 1996, issued a Report adverse to Puzon's titles in connection with Civil Case No. Q-97-32725 (entitled "Benjamin Cruz v. Evangeline Puzon") pending with the Regional Trial Court of Quezon City, Branch 99.

21 "Nothing hereinbefore provided shall prevent any registered owner or person in interest from filing the petition mentioned in section five of this Act directly with the proper Court of First Instance, based on sources enumerated in sections 2(a), 2(b), 3(a), 3(b), and/or 4(a) of this Act: Provided, however, That the court shall cause a notice of the petition, before hearing and granting the same, to be published in the manner stated in section nine hereof: And, provided, further, That certificates of title reconstituted pursuant to this section shall not be subject to the encumbrance referred to in section seven of this Act." (Emphasis supplied)cralawlibrary

22 "A registered owner desiring to have his reconstituted certificate of title freed from the encumbrance mentioned in section seven of this Act, may file a petition to that end with the proper Court of First Instance, giving his reason or reasons therefor. A similar petition may, likewise, be filed by a mortgagee, lessees or other lien holder whose interest is annotated in the reconstituted certificate of title. Thereupon, the court shall cause a notice of the petition to be published, at the expense of the petitioner, twice in successive issues of the Official Gazette, and to be posted on the main entrance of the provincial building and of the municipal building of the municipality or city in which the land lies, at least thirty days prior to the date of hearing, and after hearing, shall determine the petition and render such judgment as justice and equity may require. The notice shall specify, among other things, the number of the certificate of title, the name of the registered owner, the names of the interested parties appearing in the reconstituted certificate of title, the location of the property, and the date on which all persons having an interest in the property must appear and file such claim as they may have. The petitioner shall, at the hearing, submit proof of the publication and posting of the notice: Provided, however, That after the expiration of two years from the date of the reconstitution of a certificate of title, if no petition has been filed within that period under the preceding section, the court shall, on motion ex parte by the registered owner or other person having registered interest in the reconstituted certificate of title, order the register of deeds to cancel, proper annotation, the encumbrance mentioned in section seven hereof." (Emphasis supplied)cralawlibrary

23 No. L-45168, 27 January 1981, 102 SCRA 370.

24 Id. at 439.

25 Circular 35 pertinently provides:

3. Within five (5) days from receipt of the petition, the Clerk of Court shall forward to this Commission a signed copy of the petition together with the necessary requirements as prescribed in Secs. 4 and 5 hereof; x x x x

8. Upon receipt of the petition, the Records Section of this Commission shall, after the same is recorded in a separate book used exclusively for reconstitution cases, forward all the papers to the Clerks of Court Division for processing. If the Chief, Clerks of Court Division, finds that the requirements as called for by these guidelines have not been complied with, or that the plan and technical description as submitted by the petitioner are deficient or defective, the Court shall be immediately informed thereof so that action on the petition may be held in abeyance until after the requirements shall have been complied with.

9. Thereafter, the Chief, Clerks of Court Division, shall forward the entire records of the case, properly foldered, to the Head Geodetic Engineer of the Division of Original Registration for examination and verification.

10. After the processing and approval of the plan and technical description pursuant to Administrative Order No. 13, dated July 7, 1969 and the verification and examination of the documents to be used as the source of the reconstitution shall have been accomplished, the Head Geodetic Engineer shall return the entire records of the case, together with his written comments and/or findings, to the Chief, Clerks of Court Division, for the preparation of the corresponding report.

11. All papers, together with the Report, shall be forwarded to the Chief, Docket Division, the Commission, who shall transmit the same to the proper Regional Trial Court, thru the Records Section.

12. The Register of Deeds, upon receipt of a copy of the petition and notice of hearing, shall verify the status of the title - whether valid and subsisting at the time of the alleged loss; whether or not another title exists in the said office covering the same property; and as to the existence of transactions registered or pending registration which may be adversely affected thereby. He shall submit his written findings to the Court on or before the date of initial hearing of the petition.

13. The Court, after considering the report of the Land Registration Commission and [the] comments and findings of the Register of Deeds concerned, as well as the documentary and parole evidence presented by the petitioner, may take such action on the petition as it may deem proper.

26 Section 5(g), Rule 135 of the Rules of Court provides: "Inherent powers of courts. - Every court shall have power: x x x (g) To x x x control its process and orders so as to make them conformable to law and justice[.]" We further explained in Santiago v. Vasquez (G.R. NOS. 99289-90, 27 January 1993, 217 SCRA 633, 648): "Courts possess certain inherent powers which may be said to be implied from a general grant of jurisdiction, in addition to those expressly conferred on them. These inherent powers are such powers as are necessary for the ordinary and efficient exercise of jurisdiction; or essential to the existence, dignity and functions of the courts, as well as to the due administration of justice; or are directly appropriate, convenient and suitable to the execution of their granted powers; and include the power to maintain the court's jurisdiction and render it effective in behalf of the litigants." (Emphasis supplied; internal citations omitted)

27 See Abellana v. Dosdos, 121 Phil. 241, 245 (1965) where the Court held: "After a judgment has become final, if there is evidence of an event or circumstance which would affect or change the rights of the parties thereto, the court should be allowed to admit evidence of such new facts and circumstances, and thereafter suspend its execution and grant relief as the new facts and circumstances warrant."

28 "The Register of Deeds, upon receipt of a copy of the petition and notice of hearing, shall verify the status of the title - whether valid and subsisting at the time of the alleged loss; whether or not another title exists in the said office covering the same property; and as to the existence of transactions registered or pending registration which may be adversely affected thereby. He shall submit his written findings to the Court on or before the date of initial hearing of the petition."

29 Sections 12 and 13 of RA 26 also require actual notice to the occupants of the property. Respondents claim that they are the sole occupants of Lot 1.

30 Jaime de Paz Lee, Juanito Salandoon, Nenita Salandoon, Walter Maristela, and Manuel Maristela.

31 Respondents contend that Uy and Zalamea have no known addresses and that their titles are fictitious. However, the fact that both filed Civil Case No. Q-96-29545 in Branch 227 of the Regional Trial Court of Quezon City belies their incognito status. As to respondents' claim against the validity of TCT Nos. 187042 and 187040, this should be properly raised as counterclaim in Civil Case No. Q-96-29545.

32 No. L-45168, 27 January 1981, 102 SCRA 370, 435-436.

33 121 Phil. 1122, 1128 (1965).

34 G.R. No. 109645, 25 July 1994, 234 SCRA 455.

35 215 Phil. 593 (1984).

36 The Court denied the petitions in the Decision of 22 April 1992 (G.R. No. 76265, 22 April 1992, 208 SCRA 215) and the motions for reconsideration in the Resolution of 11 March 1994 (G.R. No. 76265, 11 March 1994, 231 SCRA 88).

37 209 Phil. 325, 335-336 (1983) citing 31 Am Jur. 91-92.

38 MWSS v. Sison, supra.

39 Republic v. Court of Appeals, 368 Phil. 412 (1999).

40 Neither RA 26 nor Circular No. 35 provides the applicable procedure to set aside void reconstitution orders.

41 Republic v. Court of Appeals, 368 Phil. 412 (1999); See Strait Times, Inc. v. Court of Appeals, 356 Phil. 217 (1998).

42 E.g., Alabang Development Corporation v. Hon. Valenzuela, 201 Phil. 727 (1982); Director of Lands v. Court of Appeals, No. L-45168, 27 January 1981, 102 SCRA 370.

43 Respondents' attempt to obtain a favorable ruling, as they did initially obtain, by presenting a fictitious LRA Report seems to exemplify this practice. If, as respondents say, it is their Torrens certificate of title which is valid, and not TCT Nos. 187040 and 187042, and Branch 227 of the Regional Trial Court, Quezon City in Case No. Q-96-29545 sustains their claim, then they are in a much better position to seek the reconstitution of the original of TCT No. 252708, if they so desire.

44 No. L-45168, 27 January 1981, 102 SCRA 370, 451.

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