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THIRD DIVISION

G.R. No. 139518 - March 6, 2001

EVANGELINE L. PUZON, petitioner, v. STA. LUCIA REALTY AND DEVELOPMENT, INC., respondent.

PANGANIBAN, J.:

Are notices to owners of adjoining lots and actual occupants of the subject property mandatory and jurisdictional in petitions for judicial reconstitution of destroyed original certificates of title, when the source for such reconstitution is the extant owner's duplicate transfer certificate of title? More specifically, is the failure to send those notices fatal to a trial court's final and executory decision granting the reconstitution? In other words, may the decision be annulled on the ground of lack of jurisdiction? The short answer to all of these questions is "No."

The Case

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the April 30, 1999 Decision1 of the Court of Appeals (CA), as well as its July 21, 1999 Resolution2 denying petitioner's Motion for Reconsideration. The dispositive part of the Decision reads:

"WHEREFORE, the petition is granted. The decision dated February 11, 1994 in LRC Case No. Q-6436 (93) of RTC, Br. 80, Quezon City is hereby ANNULLED and SET ASIDE. TCT Nos. RT-78673 (240131) and RT-78672 (213611) reconstituted in the name of private respondent Evangeline L. Puzon are declared cancelled and null and void for being in violation [of] Republic Act No. 26, Supreme Court Administrative Circular No. 7-96 and Land Registration Authority circulars.

SO ORDERED."

The Facts

On June 11, 1988, a fire in the office of the Register of Deeds of Quezon City destroyed, among others, the original copies of petitioner's Transfer Certificate of Title (TCT) Nos. 240131 and 213611 issued by the Register of Deeds of Quezon City, covering two lots with areas of 109,038 and 66,836 square meters respectively, both located in the District of Capitol, Quezon City.

In October 1993, petitioner filed before the Regional Trial Court (RTC) of Quezon City, Branch 80, a Petition for the judicial reconstitution of the two destroyed titles. The Petition, docketed as LRC Rec. No. Q-6436 (93), was based on the owner's duplicate copies of the TCTs, which were in petitioner's possession.

The October 26, 1993 RTC Order, which served as the notice for the hearing of the Petition for reconstitution, was published in two (2) successive issues of the Official Gazette. Thirty days before the date of hearing, the Order was also posted at the entrance of the Quezon City Hall Building and on the bulletin board of the trial court. Together with a copy of the Petition, it was served on the Office of the Solicitor General, the Register of Deeds for Quezon City, the Land Registration Authority (LRA), the Land Management Bureau, and the Office of the City Prosecutor for Quezon City.

During the trial which commenced on January 17, 1994, no opposition was registered. A representative from the Office of the Solicitor General, however, appeared and cross-examined petitioner, who was the sole witness. After trial, the RTC rendered its Decision dated February 11, 1994. The court disposed as follows:

"WHEREFORE, the Court hereby GRANTS the petition. Accordingly, the Register of Deeds of Quezon City is ordered to reconstitute the original copies of TCT Nos. 213611 and 240131 from and on the basis of the owner's duplicate copies thereof in possession of petitioner Evangeline L. Puzon, after payment of the prescribed legal fees."3

Accordingly, the Register of Deeds of Quezon City issued to herein petitioner TCT Nos. RT-78673 (240131) and RT-78672 (213611). These TCTs were for the lots covered by the destroyed certificates, whose numbers are indicated in the parentheses.

After discovering in 1996 that Sta. Lucia Realty and Development, Inc., herein respondent, was occupying a portion of the land covered by TCT No. RT-78673 (240131), petitioner filed against it and Garsons Co. Inc. a Complaint for Accion Reinvindicatoria with Damages and Prayer for the Issuance of Temporary Restraining Order/Writ of Injunction.

On March 25, 1998, while the accion reinvindicatoria was still pending before the RTC of Quezon City (Branch 104), respondent filed before the CA a Petition for Annulment of Judgment, seeking to annul and set aside the earlier Decision of the RTC of Quezon City (Branch 80) in the reconstitution case.

Ruling of the Court of Appeals

Annulling the Decision of the RTC (Branch 80), the CA held that petitioner had failed to comply with the requirements of Section 13, Republic Act No. 26. Citing Republic v. Marasigan,4 it ruled that notices to adjoining owners and actual occupants of the land were mandatory and jurisdictional in an action for the judicial reconstitution of a certificate of title. It also opined that the RTC Decision had been rendered without requiring a clearance from the LRA. Finally, it referred to earlier findings of the land registration commissioner that petitioner's TCT No. RT-78672 (213611) was fake.

Hence, this Petition.5

The Issues

Petitioner raises the following issues for the consideration of this Court:

"1. The Honorable Court of Appeals grossly erred in applying the provisions of Section 13 of R.A. No. 26, which is applicable only in relation to Section 12 of R.A. No. 26. Notices to adjoining owners and actual occupants of the land are not mandatory and jurisdictional in reconstitution of titles based on the owner's duplicate copy.

"2. The Court of Appeals grossly erred in holding that 'clearance from the land registration authority' is a jurisdictional requirement.

"3. The Court of Appeals grossly erred in holding that petitioner's TCT No. RT-87672 (213611) covering lot 119 is fake and spurious."6

The Court's Ruling

The Petition is meritorious.

First Issue:
Notice Requirement

Respondent and the CA contend that notices to owners of adjoining lots are mandatory in the judicial reconstitution of a title. They cite as authority Section 13 of Republic Act No. 26,7 which we reproduce hereunder:

"SEC. 13. 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."

The clear language of the law militates against the interpretation of respondent and the appellate court. The 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: (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 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; 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 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; and

(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; and

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

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 Nine8 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.

In this light, the cases cited by respondent -- particularly Republic v. Marasigan,9 Manila Railroad Co. vs. Moya10 and Director of Lands v. Court of Appeals11-- are not applicable, because they all involve judicial reconstitution under Sections 12 and 13 of RA 26.

There is no question that in such actions, 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.

In the present case, the source of the reconstitution of petitioner's TCT is the extant owner's copy, which falls under Section 3(a). It follows that the applicable provision of law is Section 10 in relation to Section 9 of RA 26, not Sections 12 and 13. When the reconstitution is based on an extant owner's duplicate TCT, the main concern is the authenticity and genuineness of the Certificate, which could best be determined or contested by the government agencies or offices concerned, principally the Office of the Solicitor General. The adjoining owners or actual occupants of the property covered by the TCT are hardly in a position to determine the genuineness of the Certificate. Giving them notice and inviting them to participate in the reconstitution proceeding is not only illogical, but constitutes a useless effort to clog the dockets of courts.

Let it also be remembered that the TCT holder in this case had no fault at all in the destruction of the original Certificate in the office of the Register of Deeds. Hence, she should not be burdened with meaningless formalities in the prosecution of her property rights, including the reconstitution of her original TCT. Moreover, the interests of creditors, whose liens may have been registered in the original Certificate on file with the Register of Deeds but not annotated in the owner's copy, are addressed by the publication requirement. However, even in this instance, the notification of adjoining owners is hardly necessary.

Finally, the parties must not lose sight of the nature of judicial reconstitution proceedings, which denote a "restoration of the instrument which is supposed to have been lost or destroyed in its original form and condition. The purpose of the reconstitution of title or any document is to have the same reproduced, after proper proceedings in the same form they were when the loss or destruction occurred."12 We emphasize that these actions do "not pass upon the ownership of the land covered by the lost or destroyed title. Possession of a lost certificate of title is not necessarily equivalent to ownership of the land covered by it. The certificate of title, by itself, does not vest ownership; it is merely an evidence of title over a particular property."13

Second Issue
Pertinent Circulars

Petitioner also contends that the Court of Appeals erred in holding that an LRC clearance is a jurisdictional requirement. We agree. None of the circulars mentioned in Supreme Court Administrative Circular No. 7-96 ("Circular 7-96") requires any clearance from the Land Registration Authority for the judicial reconstitution of certificates of title under Section 10 of RA 26. NALTDRA Circular No. 91 ("Circular 91"), which is mentioned in Circular 7-96 and has the word "clearance" in its heading, deals with the subject of original land registration cases, not reconstitution of titles. Thus, Circular 91 is not applicable to this case.

Even LRC Circular No. 35, which is also mentioned in Circular 7-96, does not require any clearance. Rather, it requires the Chief of the Clerks of Court Division to make a report, and likewise the Register of Deeds to write a report of his or her findings after verifying the status of the title, which is the subject of the reconstitution. Both reports are to be submitted to the reconstitution court on or before the date of the initial hearing.14 It is not mandatory, however, for the reconstitution court to wait for such reports indefinitely. If none is forthcoming on or before the date of the initial hearing, it may validly issue an order or judgment granting reconstitution. This is implied from the provisions of Section 16 of the same Circular, which states:

"16. Should an order or judgment granting reconstitution be issued by the Court without awaiting the report and the recommendations of this Commission as well as the verification of the Register of Deeds concerned, or while the examination, verification and preparation of the report and recommendation are still pending in the said Offices due to the failure of the Clerk of Court or the petitioner to comply with all the necessary requirements as called for herein, and it appears that there is a valid ground to oppose the reconstitution, a motion to set aside the order/judgment granting reconstitution or to stay the period of finality of said order/judgment shall be filed by the Land Registration Commissioner and/or the Register of Deeds thru the Solicitor General or the provincial or city fiscal concerned."

In the present case, therefore, neither was the Petition for reconstitution affected nor was the RTC divested of its jurisdiction by the fact that the trial court rendered the judgment ordering the reconstitution of a lost or destroyed certificate of title without awaiting the report and recommendations of the land registration commissioner and the register of deeds of Quezon City.

Also, LRC Circular No. 35 requires that notices of hearings be given to the register of deeds of the place where the property is located, the land registration commissioner and the provincial or city fiscal.15 But nowhere does it require that such notices be sent also to owners of adjoining properties and actual occupants of the land. Thus, in the present case, the fact that none were sent to the owners of adjoining lots or to the alleged actual occupants of the subject property did not negate the jurisdiction of the RTC.

Third Issue
The Character of Petitioner's TCT

Lastly, petitioner questions the finding of the Court of Appeals that her TCT No. RT-87672 (213611) is fake.

Again, we find merit in her submission. We stress that the Petition filed by respondent before the CA was for the annulment of judgment on the ground of lack of jurisdiction. Such recourse is limited to the grounds provided by law, and cannot be used to reopen the entire controversy.16 The CA was not being called upon to determine the character of petitioner's TCT. Evidently, its ruling with respect thereto was merely an obiter dictum that did not, and indeed could not, rule on such matter. It had no authority to do so.

Verily, the only issue before the CA was the jurisdiction of the RTC, not the correctness of the latter's Decision which had become final and unappealable. In debunking the genuineness of petitioner's TCT, it was going beyond the ambit of the case before it: the alleged lack of jurisdiction of the RTC to render the questioned judgment.

WHEREFORE, the Petition is GRANTED, and the assailed Decision of the Court of Appeals is hereby REVERSED and SET ASIDE. No costs.

SO ORDERED.

Melo, Vitug, Gonzaga-Reyes, and Sandoval-Gutierrez, JJ., concur.



Endnotes:

1 Penned by Justice Corona Ibay-Somera (Division chairman) and concurred in by Justices Oswaldo D. Agcaoili and Eloy R. Bello Jr. (members); rollo, pp. 46-56.

2 Rollo, p. 58.

3 Rollo, p. 177; written by Judge Agustin L. Dizon.

4 198 SCRA 219, June 6, 1991.

5 The case was deemed submitted for resolution on September 13, 2000, upon receipt by this Court of petitioner's Memorandum signed by Atty. Francisco P. Acosta. Respondent adopted its Comment, which was signed by Atty. Abner O. Antazo, as its Memorandum.

6 Petitioner's Memorandum, p. 20; rollo, p. 259.

7 RA 26 must be viewed in the light of 110 of PD 1529, which provides:

"SEC. 110. Reconstitution of lost or destroyed original of Torrens title. -- Original copies of certificates of title lost or destroyed in the offices of Register of Deeds as well as liens and encumbrances affecting the lands covered by such titles shall be reconstituted judicially in accordance with the procedure prescribed in Republic Act No. 26 insofar as not inconsistent with this Decree. The procedure relative to administrative reconstitution of lost or destroyed certificate prescribed in said Act is hereby abrogated.

Notice of all hearings of the petition for judicial reconstitution shall be given to the Register of Deeds of the place where the land is situated and to the Commissioner of Land Registration. No order or judgment ordering the reconstitution of a certificate of title shall become final until the lapse of thirty days from receipt by the Register of Deeds and by the Commissioner of Land Registration of a notice of such order or judgment without any appeal having been filed by any of such officials."

8 9 reads as follows:

"SEC. 9. 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, lessee, 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, after proper annotation, the encumbrance mentioned in Section Seven hereof."

9 198 SCRA 219, June 6, 1991.

10 14 SCRA 358, June 22, 1965.

11 102 SCRA 391, January 27, 1981.

12 Alipoon v. CA, GR No. 127523, March 22, 1999, per Gonzaga-Reyes, J.

13 Strait Times, Inc. v. Court of Appeals, 294 SCRA 714, August 28, 1998, per Panganiban, J.

14 LRC Circular No. 35, 8-12.

15 The Notice shall state among other things:

(a) the number of the lost or destroyed certificates of title, if known;

(b) the name of the registered owner;

(c) the location and area of the property;

(d) the names of the occupants or persons in possession of the property;

(e) the owners of the adjoining properties;

(f) all other interested parties; and

the date on which all persons having any interest therein must appear and file their claim or objection to the petition.

The Clerk of Court must comply strictly with the requirements of publication, posting and mailing as required under Sec. 13 of RA No. 26.

Notices of hearings shall also be given to the Register of Deeds of the place where the property is located, the Land Registration Commissioner and the provincial or city fiscal of the province or city where the land is located who shall appear for and protect the interests of the government in court on the basis of the report and recommendations of the Land Registration Commissioner and the Register of deeds concerned which are required to be submitted to the Court.

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 Clerk 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 informed thereof so that action on the petition may be held in abeyance until after the requirements shall have been complied with.

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.

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.

16 2, Rule 47 of the Rules of Court provides: "The annulment may be based only on the grounds of extrinsic fraud and lack of jurisdiction." See also Heirs of Antonio Pael et al. v. CA, GR No. 133547, February 10, 2000; Pascual v. CA, 300 SCRA 214, December 16, 1998; Arcelona v. CA, 280 SCRA 20, October 2, 1997.




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en comments and/or findings, to the Chief, Clerks of Court Division, for the preparation of the corresponding report.

16 2, Rule 47 of the Rules of Court provides: "The annulment may be based only on the grounds of extrinsic fraud and lack of jurisdiction." See also Heirs of Antonio Pael et al. v. CA, GR No. 133547, February 10, 2000; Pascual v. CA, 300 SCRA 214, December 16, 1998; Arcelona v. CA, 280 SCRA 20, October 2, 1997.




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