**Facts:**
The controversy began with a quieting of title and recovery of possession with damages filed by Rodolfo Serapion, Sr. and Rodolfo Serapion, Jr. against Napoleon Ambagan and Philip Ambagan over a 2,439-square meter land initially under OCT No. M-4863. The Serapions claimed ownership, while the Ambagans countered claiming their prior possession and application for a free patent, leading to conflicting claims over the property. The case escalated from the Municipal Trial Court (MTC) to the Regional Trial Court (RTC), and then to the Court of Appeals (CA), with each level probing the legitimacy of the involved titles and the rightful ownership, alongside procedural disputes about the proper parties-in-interest and authority to file claims.
**Issues:**
1. The standing of Rodolfo Serapion, Sr. to file the complaint on behalf of Rodolfo Serapion, Jr.
2. The validity and sufficiency of the titles claimed by both parties.
3. The procedure and authority involved in actions aimed at nullifying free patents and reverting properties to the public domain.
**Court’s Decision:**
1. **Standing and Authority to Sue:** The Supreme Court held that Rodolfo Serapion, Sr., was not the real party-in-interest to file the amended complaint for quieting of title and recovery of possession because the property had been donated to Rodolfo Serapion, Jr., rendering him the title holder and thus the real party-in-interest. Serapion, Sr.’s authority to file the case on behalf of his son was not sufficiently proven.
2. **Validity of Titles:** The Supreme Court did not favor either party’s claim of ownership through free patents outright. Instead, it noted imperfections in how the claims were pursued and the documentation presented.
3. **Reversion and Reconveyance:** The Supreme Court agreed with the CA that Napoleon, et. al., did not have the legal standing to seek the cancellation of Rodolfo Sr.’s free patent and title, and for reconveyance, emphasizing that only the State, through the Office of the Solicitor General (OSG), could initiate actions for reversion of the property to the public domain.
**Doctrine:**
1. Real Party-in-Interest: The party standing to be benefited or injured by the judgment should prosecute or defend a legal action.
2. Reversion of Property: Actions for reversion to the Government due to irregularities in free patents and titles are initiated by the Solicitor-General in the name of the Republic of the Philippines.
**Class Notes:**
1. **Real Party-in-Interest** (Rule 3, Rules of Court): Ensures legal actions are prosecuted or defended by the party who stands to gain or lose directly from the case outcome.
2. **Verification and Authority** (Rules 7): Pleadings must be verified by the party properly authorized to ensure legitimacy and prevent multiplicity of suits.
3. **Reversion Actions** (Section 101, Commonwealth Act No. 141): Only the State, through the Solicitor General, has the authority to file actions for the reversion of lands to the government due to invalid free patents or titles.
**Historical Background:**
The Serapion vs. Ambagan case reflects the complexities of property ownership disputes in the Philippines, especially concerning free patent applications and the authority to file legal actions. It underlines the procedural and substantive considerations crucial in determining real party-in-interest and the validity of claims over properties sourced from the public domain. This decision reinforces the principle that only the state can initiate reversion actions, emphasizing the protective measures around public lands against fraudulent or erroneous claims of private ownership.
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