Republic v. Rovency Realty and Development Corp PDF
Republic v. Rovency Realty and Development Corp PDF
Republic v. Rovency Realty and Development Corp PDF
DECISION
MARTIRES , J : p
This is a petition for review on certiorari seeking to reverse and set aside the 10
March 2009 Decision 1 and the 3 December 2009 Resolution 2 of the Court of Appeals
(CA) in CA-G.R. CV No. 00651, which a rmed the 7 November 2003 Decision 3 of the
Regional Trial Court (RTC), Branch 41, Cagayan de Oro City, in LRA Case No. N-2000-
084, which granted the application for original registration of title to land by respondent
Rovency Realty and Development Corporation (RRDC).
THE FACTS
On 22 March 2001, RRDC led before the RTC an Amended Application for
Registration 4 covering a parcel of land identi ed as Lot No. 3009 (subject land)
situated in Barangay Balulang, Cagayan de Oro City, described as follows:
A parcel of land (Lot No. 3009, Cad-237, Cagayan Cadastre) situated in
the Barrio of Carmen, City of Cagayan de Oro, Island of Mindanao. Bounded on
the S., along line 1-2 by Lot 6648; on the NW., along line 2-3 by Lot 30011; along
line 3-4 by Lot 3010; along line 4-5 by Lot 3047; along line 5-6 by Lot 3020; on
the N., along line 6-7 by Lot 3007; on the SE., along line 8-9 by Lot 6645; along
line 9-1 by Lot 3008; all of Cad-237, Cagayan Cadastre. EcTCAD
Beginning at the point marked "1" on the plan being N. 51 deg. 24'W.,
1091.05 m. from PBM No. 24, Cad-237, Thence;
RRDC also presented a certi cation 2 1 from the Community Environment and
Natural Resources O ce (CENRO), Cagayan de Oro City, certifying that the subject land
is alienable and disposable and not covered by any public land application patent and
hence, no patent has been issued thereon. Lastly, RRDC presented several tax
declarations in the name of its predecessors-in-interest, the earliest of which is T.D. No.
91264, which showed that realty taxes on the subject land have been paid in 1947. 2 2
On the other hand, to support their claim that a patent over the subject land had
been issued in the name of their father, the private oppositors presented a certi cation
2 3 issued by the Records Management Division of the Lands Management Bureau of
the Department of Environment and Natural Resources which merely states that ". . .
according to the veri cation made by the Geodetic Surveys Division, survey plan no.
Psu-45882 with an accession no. 284578 is located at Cagayan, Misamis, as per their
EDP listing. It is unfortunate however that as of this moment, this o ce (Records
Management Division) cannot locate said records despite diligent search made
thereon."
The RTC Ruling
In its decision, dated 7 November 2003, the RTC granted RRDC's application for
registration of the subject land. It opined that the CENRO certi cation, stating that the
subject land is alienable and disposable and not covered by any public land application,
is su cient to show the character of the land. It further ruled, that RRDC and its
predecessors-in-interest had been in open and continuous possession under a bona
fide claim of ownership over the subject land based on the documentary and
testimonial evidence offered by RRDC, without discussing how these pieces of
evidence established the required possession.
The trial court further brushed aside the opposition interposed by the heirs of
Paulino Avanceña. It was not convinced that the evidence they presented were
su cient to grant the application in their favor. It noted that the oppositors' claim that
they were the rightful owners of the subject land does not hold water considering that
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the deeds of sale presented by RRDC in support of their claim were notarized by
Paulino himself.
The dispositive portion of the RTC decision reads:
WHEREFORE, this Court considering the evidence of the applicant, the
reports of the Land Registration Authority, Director of Lands and the
Certi cation of the CENRO, DENR, Cagayan de Oro City, hereby declares that the
applicant, Rovency Realty & Development Corporation, have su cient title
proper for registration over the parcel of land subject of this application. The
opposition of the Heirs of Paulino Avanceña, is hereby ordered dismissed, being
lack of merit.
Accordingly, in accordance with the prayer of the applicant herein, the
Commissioner, or anyone acting on his behalf is hereby directed to ISSUE A
DECREE OF REGISTRATION and the CORRESPONDING CERTIFICATE OF TITLE
FOR THE PARCEL OF LAND described in the instant application in favor of
ROVENCY REALTY and DEVELOPMENT CORPORATION. SO ORDERED. 2 4
Unconvinced, the Republic, through the OSG, and private oppositors heirs of
Paulino Avanceña, elevated their respective appeals to the CA. 2 5
The Republic contended that the trial court erred in granting the application for
registration, considering that the land applied for is in excess of what is allowed by the
Constitution; and that the Corporation Code further prohibits RRDC to acquire the
subject land unless the acquisition thereof is reasonably necessary for its business. On
the other hand, the Avanceña heirs insisted that they are the rightful owners of the
subject land, by virtue of the homestead patent granted to their predecessor-in-interest.
The CA Ruling
In its assailed decision, dated 10 March 2009, the CA a rmed the 7 November
2003 RTC decision. The appellate court concurred with the trial court's ndings that the
subject land is alienable and disposable, and that RRDC has su ciently established the
required period and character of possession. Likewise, the appellate court was not
persuaded by the claims of the heirs. It noted that the private oppositors anchored their
claim on the alleged homestead grant to Paulino, their predecessor-in-interest, which
claim was unsupported by sufficient documentary evidence. HESIcT
The appellate court also ruled that the 12-hectare limit under the Constitution
was not violated. It explained that Section 3 of Article XII of the 1987 Constitution, the
constitutional provision which provided for the 12-hectare limit in the acquisition of
land, covers only agricultural lands of the public domain. It ratiocinated that when the
subject land was acquired through acquisitive prescription by RRDC's predecessors-in-
interest, it was converted into a private property and, as such, it ceased to be part of the
public domain. Thus, when RRDC acquired the subject land by purchase, it was no
longer within the ambit of the constitutional limitation.
As to the contention that the Corporation Code bars RRDC to acquire the subject
land, the appellate court simply stated that while the said code imposes certain
limitations on the acquisition of real property, there is no such prohibition. It stressed
that RRDC is an arti cial being imbued with the power to purchase, hold, and convey
real and personal property for such purposes that are within the objects of its creation.
Considering that RRDC is a corporation engaged in realty business, it has the power to
purchase real properties. The dispositive portion of said decision states:
WHEREFORE, the appeal is DENIED. The assailed November 7, 2003
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Decision of the Regional Trial Court (RTC) of Misamis Oriental, Branch 41,
Cagayan de Oro City is hereby AFFIRMED. SO ORDERED. 2 6
The Republic moved for reconsideration; while the Heirs of Paulino Avanceña
adopted the Republic's motion for reconsideration as their own. In its resolution, dated
3 December 2009, the CA denied the motion for reconsideration.
Hence, this petition.
THE ISSUES
I.
THE TRIAL COURT ERRED IN GRANTING THE AMENDED APPLICATION
FOR REGISTRATION AND ORDERING THE ISSUANCE OF A DECREE OF
REGISTRATION AND THE CORRESPONDING CERTIFICATE OF TITLE
FOR A PARCEL OF LAND CONTAINING AN AREA OF THREE HUNDRED
EIGHTEEN THOUSAND THREE HUNDRED FORTY FIVE (318,345)
SQUARE METERS IN FAVOR OF ROVENCY REALTY AND
DEVELOPMENT CORPORATION, DESPITE THE FACTS THAT —
(i) THE LAND APPLIED FOR REGISTRATION OF TITLE IS IN
EXCESS OF WHAT IS ALLOWED BY LAW; AND ,
(ii) RESPONDENT'S RIGHT TO ACQUIRE THE SUBJECT
PARCEL OF LAND IS FURTHER LIMITED BY THE
CORPORATION CODE .
II.
RESPONDENT'S EVIDENCE IS INSUFFICIENT TO PROVE THAT IT OR
ITS PREDECESSORS-IN-INTEREST HAVE BEEN IN OPEN, CONTINUOUS,
EXCLUSIVE AND NOTORIOUS POSSESSION UNDER A BONA FIDE
CLAIM OF OWNERSHIP SINCE JUNE 12, 1945 OR EARLIER AND THE
SUBJECT PROPERTY IS NO LONGER INTENDED FOR PUBLIC USE OR
FOR THE DEVELOPMENT OF THE NATIONAL WEALTH . 2 7
The Republic argues that the trial and appellate courts erred in granting RRDC's
application for the registration of the subject land, as the same has a total land area of
31.8 hectares, which is way beyond the 12-hectare limit under Section 3, Article XII of
the 1987 Constitution, which provides:
SECTION 3. Lands of the public domain are classi ed into
agricultural, forest or timber, mineral lands, and national parks. Agricultural
lands of the public domain may be further classi ed by law according to the
uses which they may be devoted. Alienable lands of the public domain shall be
limited to agricultural lands. Private corporations or associations may not
hold such alienable lands of the public domain except by lease , for a
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period not exceeding twenty- ve years, renewable for not more than twenty- ve
years, and not to exceed one thousand hectares in area. Citizens of the
Philippines may lease not more than ve hundred hectares, or acquire
not more than twelve hectares thereof by purchase, homestead, or
grant . [emphasis supplied]
As can be clearly gleaned from its language, Section 3, Article XII applies only to
lands of the public domain. Private lands are, therefore, outside of the prohibitions and
limitations stated therein. Thus, the appellate court correctly declared that the 12-
hectare limitation on the acquisition of lands under Section 3, Article XII of the 1987
Constitution has no application to private lands.
A case in point is the absolute prohibition on private corporations from acquiring
any kind of alienable land of the public domain. This prohibition could be traced to the
1973 Constitution which limited the alienation of lands of the public domain to
individuals who were citizens of the Philippines. This constitutional prohibition,
however, does not necessarily mean that corporations may not apply for original
registration of title to lands. In fact, the Court, in several instances, a rmed the grant of
applications for original registration led by corporations, 2 8 for as long as the lands
were already converted to private ownership by operation of law as a result of
satisfying the requisite possession required by the Public Land Act. 2 9
I n Director of Lands v. Intermediate Appellate Court 3 0 (Director of Lands), the
Court granted the application for original registration of parcels of land led by a
corporation which acquired the lands by purchase from members of the Dumagat tribe.
The Court ratiocinated that the lands applied for registration were already private lands
even before the corporation acquired them. The Court observed that the sellers, being
members of the national cultural minorities, had by themselves and through their
predecessors, possessed and occupied the lands since time immemorial. As a
consequence of their open, exclusive, and undisputed possession over the said lands
for the period required by law for the acquisition of alienable lands of the public
domain, said lands ceased to become part of the public land and were converted, by
operation of law, into private ownership. As such, the sellers, if not for their conveyance
of the lands in question to the corporation, were entitled to exercise the right granted to
them by the Public Land Act to have their title judicially con rmed. Considering further
that the lands in question were already private in character at the time the corporation
acquired them, the constitutional prohibition does not apply to the corporation. caITAC
I n Republic of the Philippines vs. Cortez, 3 2 the Court explained that applicants
for original registration of title to land must rst establish compliance with the
provisions of either Section 14 (1) or Section 14 (2) of P.D. No. 1529, which state:
Sec. 14. Who may apply. The following persons may le in the
proper Court of First Instance an application for registration of title to land,
whether personally or through their duly authorized representatives:
(1) Those who by themselves or through their
predecessors-in interest have been in open, continuous, exclusive
and notorious possession and occupation of alienable and
disposable lands of the public domain under a bona de claim of
ownership since June 12, 1945, or earlier.
(2) Those who have acquired ownership of private
lands by prescription under the provision of existing laws.
It must be emphasized that the requirements and bases for registration under
these two provisions of law differ from one another. Section 14 (1) mandates
registration on the basis of possession, while Section 14 (2) entitles registration on the
basis of prescription. 3 3 Thus, it is important to ascertain under what provision of
Section 14 the registration is sought.
A reading of the application, however, is unavailing. In its application, RRDC
alleged that it and its predecessors-in-interest "had been in open, continuous, adverse,
and peaceful possession in concept of owner of the subject property since time
immemorial or for more than thirty years." This allegation made it unclear whether
registration is sought under Section 14 (1) — possession since 12 June 1945 or earlier;
or under Section 14 (2) — possession for more than thirty years.
An examination of the 7 November 2003 RTC decision also proved futile
considering that, and as previously pointed out, aside from enumerating the exhibits
offered by the applicant, the trial court did not discuss how these pieces of evidence
established the requisites for registration. Thus, for the proper resolution of the issues
and arguments raised herein, it becomes necessary for the present application to be
scrutinized based on the requirements of the provisions of Sections 14 (1) and (2) of
P.D. No. 1529.
Registration under Section 14 (1)
of P.D. No. 1529
In the present case, to prove that the subject land is alienable and disposable,
RRDC presented a CENRO certi cation stating that the subject land is "alienable and
disposable and not covered by any public land application." RRDC, however, failed to
present a certi ed true copy of the original classi cation approved by the DENR
Secretary declaring the subject land alienable and disposable. Clearly, the evidence
presented by RRDC falls short of the requirements in T.A.N. Properties . Thus, the trial
and appellate courts erred when they ruled that the subject land is alienable and
disposable part of the public domain and susceptible to original registration.
Furthermore, RRDC also failed to prove that it and its individual predecessors-in-
interest sufficiently complied with the required period and nature of possession.
An applicant for land registration must exhibit that it and its predecessors-in-
interest had been in open, continuous, exclusive, and notorious possession and
occupation of the land under a bona de claim of ownership since 12 June 1945 or
earlier. It has been held that possession is open when it is patent, visible, apparent,
notorious, and not clandestine; it is continuous when uninterrupted, unbroken, and not
intermittent or occasional; it is exclusive when the adverse possessor can show
exclusive dominion over the land and an appropriation of it to his own use and bene t;
and notorious when it is so conspicuous, that it is generally known and talked of by the
public or the people in the neighborhood. 3 8
In Republic vs. Remman Enterprises, Inc., 3 9 the Court held that for purposes of
land registration under Section 14 (1) of P.D. No. 1529, proof of speci c acts of
ownership must be presented to substantiate the claim of open, continuous, exclusive,
and notorious possession and occupation of the land subject of the application.
Applicants for land registration cannot just offer general statements which are mere
conclusions of law rather than factual evidence of possession. Actual possession is in
the manifestation of acts of dominion over it of such nature as a party would actually
exercise over his own property.
I n Republic v. Gielczyk , the Court explained that "possession" and "occupation"
are not synonymous to each other. Possession is broader than occupation because it
includes constructive possession; whereas occupation delimits the all-encompassing
effect of constructive possession. Thus, taken together with the words open,
continuous, exclusive, and notorious, the word occupation means that for one's title to
land to be judicially recognized, his possession of the land must not be mere fiction. 4 0
In this case, aside from the deeds of absolute sale covering the subject land
which were executed prior to 12 June 1945, RRDC did not present any evidence which
would show that its predecessors-in-interest actually exercised acts of dominion over
the subject land even before the cut-off period. As such, RRDC failed to prove that its
possession of the land, or at the very least, its individual predecessors-in-interest's
possession over the same was not mere fiction.
Neither would the tax declarations presented by RRDC su ce to prove the
required possession. To recall, the earliest of these tax declarations dates back only to
1948. Clearly, the required possession and occupation since 12 June 1945 or earlier,
was not demonstrated.
From the foregoing, it is clear that RRDC failed to prove that its individual
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predecessors-in-interest had been in open, continuous, exclusive and notorious
possession and occupation of the subject land under a bona de claim of ownership
since 12 June 1945 or earlier; and that said possession and occupation converted the
subject land into a private property by operation of law. Consequently, the subject land
cannot be registered in the name of RRDC under Section 14 (1) of P.D. No. 1529.
Requirements under Section 14 (2)
of P.D. No. 1529
RRDC also failed to establish compliance with the requirements for registration
under Section 14 (2).
I n Heirs of Mario Malabanan vs. Republic (Malabanan), 4 1 the Court explained
that when Section 14 (2) of P.D. No. 1529 provides that persons "who have acquired
ownership over private lands by prescription under the provisions of existing laws," it
unmistakably refers to the Civil Code as a valid basis for the registration of lands. The
Civil Code is the only existing law that speci cally allows the acquisition by prescription
of private lands, including patrimonial property belonging to the State.
The Civil Code makes it clear that patrimonial property of the State may be
acquired by private persons through prescription. This is brought about by Article 1113,
which states that all things which are within the commerce of man are susceptible to
prescription, and that property of the State or any of its subdivisions not patrimonial in
character shall not be the object of prescription. 4 2 TCAScE
Nonetheless, this does not necessarily mean that when a piece of land is
declared alienable and disposable part of the public domain, it can already be acquired
by prescription. In Malabanan, this Court ruled that declaration of alienability and
disposability is not enough — there must be an express declaration that the public
dominion property is no longer intended for public service or the development of the
national wealth or that the property has been converted into patrimonial, thus:
"(2) In complying with Section 14(2) of the Property Registration
Decree, consider that under the Civil Code, prescription is recognized as a mode
of acquiring ownership of patrimonial property. However, public domain lands
become only patrimonial property not only with a declaration that these are
alienable or disposable. There must also be an express government
manifestation that the property is already patrimonial or no longer
retained for public service or the development of national wealth,
under Article 422 of the Civil Code. And only when the property has
become patrimonial can the prescriptive period for the acquisition of
property of the public dominion begin to run ." 4 3 [emphasis supplied]
The classi cation of the land as alienable and disposable land of the public
domain does not change its status as property of the public dominion under Article 420
(2) of the Civil Code. As such, said land, although classi ed as alienable and disposable,
is insusceptible to acquisition by prescription. 4 4
In this case, RRDC did not present any evidence which would show that the
subject land was expressly declared as no longer intended for public service or the
development of the national wealth, or that the property has been converted into
patrimonial. Hence, it failed to prove that acquisitive prescription has begun to run
against the State, and that it has acquired title to the subject land by virtue thereof.
In ne, RRDC failed to satisfy all the requisites for registration of title to land
under either Sections 14 (1) or (2) of P.D. No. 1529. RRDC also failed to establish that
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when it or P.N. Roa Enterprises, Inc., also a corporation and its direct predecessor-in-
interest, acquired the subject land, it had already been converted to private property,
thus, the prohibition on the corporation's acquisition of agricultural lands of the public
domain under Section 3, Article XII of the 1987 Constitution applies. RRDC's application
for original registration of imperfect title over Lot No. 3009 must perforce be denied.
WHEREFORE , the instant petition is GRANTED . The 10 March 2009 Decision
and 3 December 2009 Resolution of the Court of Appeals in CA-G.R. CV No. 00651,
which a rmed the 7 November 2003 Decision of the Regional Trial Court, Branch 41,
Cagayan de Oro City, in LRA Case No. N-2000-084, are hereby REVERSED and SET
ASIDE . The Application for Registration of Lot No. 3009 led by Rovency Realty and
Development Corporation is DENIED .
SO ORDERED.
Velasco, Jr., Bersamin, Leonen and Gesmundo, JJ., concur.
Footnotes
1. Rollo, pp. 59-75.
2. Id. at 76-77.
3. Id. at 78-91.
4. CA rollo, pp. 466-470.
5. Id. at 474.
6. Id.
7. Id. at 475.
8. Id. at 476.
9. Id. at 477.
10. Id. at 478-479.
11. Id. at 480-484.
28. Republic v. Sogod Development Corporation , 781 Phil. 78, 89 (2016); Director of Lands v.
Bengzon, 236 Phil. 396, 406 (1987).
29. Heirs of Mario Malabanan v. Republic, 717 Phil. 141, 166 (2013).
30. 230 Phil. 590, 597 (1986).
31. 578 Phil. 441, 461 (2008).
32. 726 Phil. 212, 220-221 (2014).
33. Espiritu v. Republic, G.R. No. 219070, 21 June 2017.
34. Republic v. Estate of Virginia Santos, G.R. No. 218345, 07 December 2016.
35. Republic v. Roasa, 752 Phil. 439, 447 (2015).
36. Republic v. De Guzman Vda. De Joson, 728 Phil. 550, 563 (2014).
37. Republic v. Alora , 762 Phil. 695, 704 (2015); Republic v. Sps. Castuera , 750 Phil. 884, 890-
891 (2015); Republic v. Lualhati , 757 Phil. 119, 131 (2015); Republic v. Sese , 735 Phil.
108, 121 (2014).
38. Republic vs. Gielczyk, 720 Phil. 385, 403 (2013).
42. Id.