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EN BANC

[G.R. NOS. 162335 & 162605 : December 18, 2008]

SEVERINO M. MANOTOK IV, FROILAN M. MANOTOK, FERNANDO M. MANOTOK III, MA.MAMERTA M. MANOTOK, PATRICIA L. TIONGSON, PACITA L. GO, ROBERTO LAPERAL III, MICHAELMARSHALL V. MANOTOK, MARY ANN MANOTOK, FELISA MYLENE V. MANOTOK, IGNACIO MANOTOK, JR., MILAGROS V. MANOTOK, SEVERINO MANOTOK III, ROSA R. MANOTOK, MIGUEL A.B. SISON, GEORGE M. BOCANEGRA, CRISTINA E. SISON, PHILIPP L. MANOTOK, JOSE CLEMENTE L. MANOTOK, RAMON SEVERINO L. MANOTOK, THELMA R. MANOTOK, JOSE MARIA MANOTOK, JESUS JUDE MANOTOK, JR., and MA. THERESA L. MANOTOK, represented by their Attorney-in-fact, Rosa R. Manotok, Petitioners, v. HEIRS OF HOMER L. BARQUE, Represented by TERESITA BARQUE HERNANDEZ, Respondents.

SEPARATE OPINION

CORONA, J.:

The integrity of the Torrens system of land registration should be zealously guarded. Otherwise, transactions involving registered lands will be utterly confusing and public faith in the Torrens system and the value of certificates of titles may be seriously impaired.¹ It is therefore the duty of courts, specially this Court, to tread carefully and cautiously in cases where its adjudication will allow or tend to allow doubts on the integrity of the Torrens system to linger. With this in mind, I respectfully submit the following opinion.

The Court of Appeals May, In Proper Instances, Order The Cancellation Of A Certificate Of Title In An Appeal of the Land Registration Authority's Decision In An Administrative Reconstitution Proceeding

In resolving controversies, this Court's duty is to apply or interpret the law. It cannot make or amend the law without treading the perilous waters of judicial legislation. It is not within the Court's power to enlarge or abridge laws; otherwise, the Court will be guilty of usurping the exclusive prerogative of Congress.

Jurisdiction over the subject matter of a case is conferred by law.² It cannot be (1) granted by the agreement of the parties; (2) acquired, waived, enlarged or diminished by any act or omission of the parties or (3) conferred by the acquiescence of the courts.³

I submit that the First Division, in its December 12, 2005 decision, enlarged the scope of the authority of the Land Registration Authority (LRA) in administrative reconstitution proceedings when it recognized the authority of the LRA to rule that petitioners' certificate of title was a sham, spurious and not duly issued.

Section 6 of PD⁴ 1529⁵ limits the LRA's functions to the following:

SEC. 6. General Functions. -

(1) The Commissioner of Land Registration shall have the following functions:

(a) Issue decrees of registration pursuant to final judgments of the courts in land registration proceedings and cause the issuance by the Register of Deeds of the corresponding certificate of title;

(b) Exercise supervision and control over all Register of Deeds and other personnel of the Commission;

(c) Resolve cases elevated en consulta by, or on appeal from decision of, Register of Deeds;

(d) Exercise executive supervision over all clerks of court and personnel of the [RTCs] throughout the Philippines with respect to the discharge of their duties and functions in relation to the registration of lands;

(e) Implement all orders, decisions, and decrees promulgated relative to the registration of lands and issue, subject to the approval of the Secretary of Justice, all needful rules and regulations therefore;

(f) Verify and approve subdivision, consolidation, and consolidation-subdivision survey plans of properties titled under Act No. 496 except those covered by PD No. 957.

(2) The [LRA] shall have the following functions:

(a) Extend speedy and effective assistance to the Department of Agrarian Reform, the Land Bank, and other agencies in the implementation of the land reform program of the government;

(b) Extend assistance to courts in ordinary and cadastral land registration proceedings; andcralawlibrary

(c) Be the central repository of records relative to original registration of lands titled under the Torrens system, including subdivision and consolidation plans of titled lands.

Thus, under PD 1529, the LRA has no authority to rule on the authenticity and validity of a certificate of title. While Section 9⁶ of RA⁷ 6732 vested the LRA with the quasi-judicial⁸ power to "review, revise, reverse, modify or affirm any decision of the reconstituting officer or Register of Deeds" on appeal in administrative reconstitution proceedings, the LRA nonetheless did not acquire any authority to declare a certificate of title void. Such power properly and exclusively pertains to the Regional Trial Court (RTC).⁹

Indeed, the separate opinions on the December 12, 2005 decision recognized that these cases should have been tried by the RTC.¹⁰ However, the said opinions stated that to remand these cases for trial at this stage would only be "a time-consuming and pointless exercise." With due respect, justice should not be sacrificed for expediency. After all, more important than anything else is that this Court be right.¹¹

Nonetheless, while the LRA cannot rule on the authenticity and validity of a certificate of title, the Court of Appeals possesses such power when presented with an appeal of the decision of the LRA in a case such as this where the validity and authenticity of a certificate of title covering a particular property is challenged in the course of and in connection with the administrative reconstitution of another certificate of title purportedly covering the same property.

In this connection, it is noteworthy that while Section 48¹² of PD 1529 provides that a certificate of title "cannot be altered, modified, or cancelled except in a direct proceeding in accordance with law," it is silent as to the specific court where the petition for cancellation of a certificate of title should be instituted. In contrast, Section 108¹³ of PD 1529 expressly states that petitions for amendment or alteration of a certificate of title covering a particular property after original registration of that property should be filed in the then Court of First Instance, now the RTC. This difference in the treatment between cancellation of a certificate of title and the alteration or amendment/modification thereof shows the legislative intent to distinguish between these actions. Thus, courts other than the RTC, such as the Court of Appeals, have the authority and jurisdiction to order the cancellation of a certificate of title which may be found to be false or fraudulent when this is necessary in the adjudication of a controversy brought before them.

Specifically, the Court of Appeals is vested under Section 9(3) of BP 129 (in connection with RA 5434) with exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of the LRA in the exercise of its quasi-judicial functions. This is reflected in Section 1, Rule 43 of the Rules of Court. However, while its jurisdiction to review the judgment, decision, resolution or award of the LRA is designated under BP 129 as "appellate," the Court of Appeals actually exercises original jurisdiction (in its traditional sense) as it is the first time that the said case becomes the subject of a judicial action.¹⁴ This is the proper character of the authority exercised by the Court of Appeals in an appeal of the judgment, decision, resolution, order or award of the LRA in an administrative reconstitution proceeding. This also supports the view that the Court of Appeals has the power to pass upon the authenticity and validity of a certificate of title covering a particular property (and to order its cancellation) when the same is put in issue in connection with the reconstitution of another certificate of title covering the same property.

This neither runs counter to nor encroaches on the power of the RTC under Section 19(2) of BP 129, as amended, to exercise exclusive original jurisdiction "[i]n all civil actions which involve the title to, or possession of, real property or any interest therein." In so canceling a certificate of title, the Court of Appeals does not resolve a civil action involving title to real property. "Title" to real property is not the same as the "certificate of title"; the certificate of title is distinct from the title itself. The certificate of title may get lost, burned or destroyed and later on reconstituted but the title subsists all the while and remains unaffected unless transferred or conveyed to another or subjected to a lien or encumbrance.

Title is the "union of all the elements (as ownership, possession and custody) constituting the legal right to control and dispose of property."¹⁵ It is the "legal link between a person who owns property and the property itself."¹⁶

Though employed in various ways, title is generally used to describe either the manner in which a right to real property is acquired, or the right itself. In the first sense, it refers to the conditions necessary to acquire a valid claim to land; in the second, it refers to the legal consequences of such conditions. These two senses are not only interrelated, but inseparable: given the requisite conditions, the legal consequences or rights follow as of course; given the rights, conditions necessary for the creation of those rights must have been satisfied. Thus, when the word 'title' is used in one sense, the other sense is necessarily implied.¹⁷

On the other hand, a Torrens certificate of title is the certificate of ownership issued under the Torrens system of registration by the government thru the Register of Deeds naming and declaring the owner in fee simple of the real property described therein, free from all liens and encumbrances except such as may be expressly noted thereon or otherwise reserved by law.¹⁸ Legally defined, a certificate of title is the transcript of the decree of registration made by the Registrar of Deeds in the registry.¹⁹

Whereas title is the claim, right or interest in land, a certificate of title is the document evidencing that right. The issuance of a certificate of title does not give the owner any better title than what he actually has. He secures his certificate of title by virtue of the fact that he has a fee simple title.²⁰ To reiterate, the loss or destruction and subsequent reconstitution of a certificate of title does not affect the subsistence of the title unless it (the title) is transferred or conveyed to another or subjected to a lien or encumbrance.

These Cases Should Be Remanded To The Court Of Appeals For Consideration Of Contentious Factual Issues

Having affirmed the authority of the Court of Appeals to order the cancellation of a certificate of title in this instance, does it follow that this Court should uphold the December 12, 2005 decision of the First Division? I do not believe so.

Considering the serious and grave imputations against the respective certificates of titles of the contending parties, it would be precipitate as well as imprudent for the Court to simply adopt the findings of the Court of Appeals in CA G.R. SP Nos. 66642 and 66700. A "surfeit of forgeries, badges of fraud and other dubious circumstances"²¹ is alleged to have attended respondents' administrative petition for reconstitution of their TCT No. T-210177. Similarly, significant irregularities and fatal defects²² have been cast on petitioners' reconstituted TCT No. RT-22481. Indeed, the parties trade serious accusations of fraud and deceit. Similarly, both parties invoke Section 11 of RA 6732 in support of their respective positions:

SEC. 11. A reconstituted title obtained by means of fraud, deceit or other machination is void ab initio as against the party obtaining the same and all persons having knowledge thereof.

Any decision in favor of one party at this moment will be a declaration (express or implied) that there is prima facie evidence that the other party obtained or sought to obtain his certificate of title by means of fraud, deceit or other machination. Such statement will give this Court no legal option but to order the criminal prosecution of the losing party pursuant to Section 12 of RA 6732:

SEC. 12. Any person who by means of fraud, deceit or other machination obtains or attempts to obtain a reconstituted title shall be subject to criminal prosecution and, upon conviction, shall be liable for imprisonment for a period of not less than two years but not exceeding five years or the payment of a fine of not less than Twenty thousand pesos but not exceeding Two hundred thousand pesos or both at the discretion of the court.

Any public officer or employee who knowingly approves or assists in securing a decision allowing reconstitution in favor of any person not entitled thereto shall be subject to criminal prosecution and, upon conviction, shall be liable for imprisonment of not less than five years but not exceeding ten years or payment of a fine of not less than Fifty thousand pesos but not exceeding One hundred thousand pesos or both at the discretion of the court and perpetual disqualification from holding public office.

Since any declaration of fraud or deceit on the part of one party will expose that party to criminal prosecution, this Court should refrain from making any such declaration until and unless the complicated and contentious maze of factual matters is clearly resolved. While these matters have been brought to the attention of the Court of Appeals in CA G.R. SP Nos. 66642 and 66700, the Court of Appeals at that time was not able to exhaustively evaluate and analyze them.

The controversial factual matters were, however, brought to light extensively and in great detail during the oral arguments of these cases as well as in the respective memoranda submitted by the parties and by Office of the Solicitor General after the oral arguments.

To reiterate, what is crucial and critical in these cases is the complete determination of contentious factual issues.

However, the investigation and appreciation of facts is beyond the province of this Court as it is neither a trier of fact nor capacitated to appreciate evidence at the first instance.²³ On the other hand, the Court of Appeals has the competence to perform that task. Indeed, we stated in Manotok Realty, Inc. v. CLT Realty Development Corporation:²⁴

Under Section 6 of Rule 46, which is applicable to original cases for certiorari, the Court may, whenever necessary to resolve factual issues, delegate the reception of the evidence on such issues to any of its members or to an appropriate court, agency or office. The delegate need not be the body that rendered the assailed decision.

The Court of Appeals generally has the authority to review findings of fact. Its conclusions as to findings of fact are generally accorded great respect by this Court. It is a body that is fully capacitated and has a surfeit of experience in appreciating factual matters, including documentary evidence.

There are indeed many factual questions looming over the respective certificates of title of the contending parties. These can only be threshed out in a remand to the Court of Appeals. Hence, I respectfully submit that the proper and prudent course now is for the Court to constitute a special division of the Court of Appeals to be composed of three associate justices to be designated by us for the purpose of hearing these cases on remand. The special division will hear and receive evidence, conclude the proceedings and submit to this Court a report on its findings and recommended conclusions within three months from finality of the Court's resolution in this case.

Accordingly, I vote that these cases be REMANDED to a special division of the Court of Appeals for further proceedings.

Endnotes:

¹ Concurring and dissenting opinion of Justice Renato C. Corona in Manotok Realty, Inc. v. CLT Realty Development Corporation, G.R. NOS. 123346, 134385 and 148767, 14 December 2007, 540 SCRA 304.

² Municipality of Kananga v. Madrona, G.R. No. 141375, 30 April 2005, 402 SCRA 330.

³ Republic v. Estipular, 391 Phil. 211 (2000).

⁴ Presidential Decree.

⁵ Property Registration Decree.

⁶ SEC. 9. The Land Registration Authority Administrator may review, revise, reverse, modify or affirm any decision of the reconstituting officer or Register of Deeds. Any appeal shall be filed within fifteen days from the receipt of the judgment or order by the aggrieved party.

⁷ Republic Act.

⁸ Quasi-judicial function is a term which applies to the action, discretion, etc., of public administrative officers or bodies required to investigate facts, hold hearings, and draw conclusions from them, as a basis for their official actions and to exercise discretion of a judicial nature. (Midland Insurance Corporation v. Intermediate Appellate Court, G.R. No. 71905, 13 August 1986, 143 SCRA 458.) A quasi-judicial adjudication would mean the determination of rights, privileges, and duties resulting in a decision or order which applies to a specific situation. (Lupangco v. Court of Appeals, G.R. No. 77372, 29 April 1988, 160 SCRA 180)

Under Section 9 of RA 6732, the power of the LRA Administrator to review, revise, reverse, modify or affirm any decision of the reconstituting officer or Register of Deeds is quasi-judicial in nature. He is given the authority to exercise discretion of a judicial nature to investigate facts and draw conclusions from them as a basis for his official action. His adjudication is quasi-judicial as it is a determination of the right of the applicant or petitioner to have his certificate of title reconstituted as well as of the correlative duty of the Registrar of Deeds to reconstitute the said certificate of title.

⁹ Under Section 19 of Batas Pambansa (BP) Blg. 129 (Judiciary Reorganization Act of 1980), as amended, it is the RTC which has sole jurisdiction to nullify or declare as void a Torrens certificate of title.

SEC. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise exclusive original jurisdiction:

x x x

(2) In all civil actions which involve the title to, or possession of, real property or any interest therein x x x (emphasis supplied)

¹⁰ In his separate opinion, Associate Justice Leonardo A. Quisumbing stated:

While at the inception of this controversy, a trial by the Regional Trial Court would have been in order, remand of this case for trial at this late stage would only be a time-consuming and pointless exercise. Prompt resolution of this controversy is in order to avoid further delay. (emphasis supplied)

On the other hand, Justice Azcuna noted the following in his separate opinion:

x x x It is, therefore, in my view, unnecessary to go through the exercise of proving this matter again in the regular courts, as would ordinarily be required, since the point is indubitable.

I thus find applicable the ruling of this Court in Ortigas and Company Limited Partnership v. Veloso, as it would be unjust to require respondents to undergo a time-consuming and pointless exercise to cancel an evidently sham and spurious title. (emphasis supplied)

¹¹ Urbano v. Chavez, G.R. No. 87977, 19 March 1990, 183 SCRA 347.

¹² SEC. 48. Certificate not subject to collateral attack. - A certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or cancelled except in a direct proceeding in accordance with law.

¹³ SEC. 108. Amendment and alteration of certificates. - No erasure, alteration, or amendment shall be made upon the registration book after the entry of a certificate of title or of a memorandum thereon and the attestation of the same be Register of Deeds, except by order of the proper Court of First Instance. A registered owner of other person having an interest in registered property, or, in proper cases, the Register of Deeds with the approval of the Commissioner of Land Registration, may apply by petition to the court upon the ground that the registered interests of any description, whether vested, contingent, expectant or inchoate appearing on the certificate, have terminated and ceased; or that new interest not appearing upon the certificate have arisen or been created; or that an omission or error was made in entering a certificate or any memorandum thereon, or, on any duplicate certificate; or that the same or any person on the certificate has been changed; or that the registered owner has married, or, if registered as married, that the marriage has been terminated and no right or interests of heirs or creditors will thereby be affected; or that a corporation which owned registered land and has been dissolved has not convened the same within three years after its dissolution; or upon any other reasonable ground; and the court may hear and determine the petition after notice to all parties in interest, and may order the entry or cancellation of a new certificate, the entry or cancellation of a memorandum upon a certificate, or grant any other relief upon such terms and conditions, requiring security or bond if necessary, as it may consider proper; Provided, however, That this section shall not be construed to give the court authority to reopen the judgment or decree of registration, and that nothing shall be done or ordered by the court which shall impair the title or other interest of a purchaser holding a certificate for value and in good faith, or his heirs and assigns, without his or their written consent. Where the owner's duplicate certificate is not presented, a similar petition may be filed as provided in the preceding section.

All petitions or motions filed under this Section as well as under any other provision of this Decree after original registration shall be filed and entitled in the original case in which the decree or registration was entered.

¹⁴ See Yamane v. BA Lepanto Condominium Corporation, G.R. No. 154993, 25 October 2005, 474 SCRA 258.

¹⁵ Black's Law Dictionary, Eighth Edition, p. 1522.

¹⁶ Id.

¹⁷ Id. citing Kent MacNeill, Common Law Aboriginal Title.

¹⁸ Philippine National Bank v. Intermediate Appellate Court, G.R. No. 71753, 26 August 1989, 176 SCRA 736.

¹⁹ Philippine National Bank v. Tan Ong Zse, 51 Phil. 317 (1927).

²⁰ Legarda v. Saleeby, 31 Phil. 590 (1915).

²¹ These include the (a) letter dated January 2, 1997 of Engr. Privaldi J. Dalire, chief of the Geodetic Surveys Division of the Lands Management Bureau, (b) plan Fls-3186-D, (c) copy of Administrative Reconstitution Order No. Q-535(96) submitted by respondents, (d) the length of time it took respondents from the occurrence of the Quezon City Hall fire to file their petition for administrative reconstitution, (e) erasures of the notation on the tax declarations of respondents, (f) realty taxes paid by respondents were only for 1987 to 1996, (g) respondents have never set foot on the disputed property, (h) the existence of Barrio Payong in Quezon City, (i) respondents' knowledge that petitioners had constructed buildings and perimeter wall on the disputed property, (j) respondents chain of title stops in 1975, (k) location of respondents' property as showed by the relocation surveys of the Lands Management Bureau and (l) the deed of sale between Emiliano Setosta and respondents' predecessor-in-interest, Homer Barque, Sr.

²² These include the (a) identity and description of the property in petitioners' certificate of title, particularly the location, boundaries and technical description of the property indicated in the said certificate of title and (b) the existence of respondents' title when petitioners' caused the reconstitution of TCT No. RT-22481.

²³ Manotok Realty, Inc. v. CLT Realty Development Corporation, supra.

²⁴ Id.