NATIONAL POWER CORPORATION, PETITIONER, VS. HONORABLE COURT OF APPEALS AND CONRADO B. PAYUMO, RESPONDENTS.

National Power Corporation versus Payumo

The Case

This is a petition for review brought by the National Power Corporation against Conrado B. Payumo and the Court of Appeals, arising from a land registration case over a parcel of land in Norzagaray, Bulacan. Payumo sought judicial confirmation of his alleged title, while the National Power Corporation opposed on the ground that the land forms part of the Angat River Watershed Reservation, reserved for its use by presidential proclamation and therefore neither alienable nor disposable. The case matters because it fixes the moment when a claim over public land ripens into a vested private right, and explains why a reservation clause "subject to private rights" saves only rights already perfected, not hopes still in the making.

Procedural History

Payumo filed his application for registration before the then Court of First Instance of Bulacan. The Castillos and the National Power Corporation opposed. After trial, the Court of First Instance dismissed the application and the oppositions except that of the National Power Corporation, declared the land public land, and held that the portion east of the boundary line in the Angat River Project plan formed part of that project under the proclamation.

Payumo and the Castillos appealed to the Court of Appeals. The Castillos' appeal was dismissed for failure to pay docket fees within the reglementary period. The Court of Appeals, in a decision dated May 4, 1977, reversed the trial court, sustained Payumo's claim of adverse possession for the required thirty years, held that his right had vested before the proclamation, and ordered that a decree issue in his name.

The National Power Corporation then came to the Supreme Court by petition for review. The Supreme Court reversed the Court of Appeals.

Facts

On June 23, 1959, the President of the Philippines issued Proclamation No. 599, reserving for the Angat River Project of the National Power Corporation a parcel of the public domain situated partly in Norzagaray and partly in San Jose, Bulacan, expressly "subject to private rights."

On October 12, 1959, Payumo applied for registration of Lot 1 of Plan Psu-167442, with an area of 15.3145 hectares, in Sitio Pamusuan, Barrio San Mateo, Norzagaray. He claimed ownership by purchase from his father-in-law, Mariano Palad, in February 1937, and continuous, exclusive, and uninterrupted possession for thirty years, tacking Palad's possession to his own. The Castillos opposed, invoking a Spanish title in the name of Mariano San Pedro. The National Power Corporation opposed, asserting that the greater portion of the land is public land included in the Angat River Project.

The trial court found that neither Payumo nor the Castillos had established a registerable right. Payumo's claim of peaceful possession since 1937 was doubtful because of a running dispute with the Castillos over possession, and Palad's pretended ownership was unsupported by any documentary evidence or credible testimony. The Court of Appeals thought otherwise and granted the application, prompting this petition.

Issues

• Whether or not Payumo had acquired a vested private right over the disputed land before the issuance of Proclamation No. 599 on June 23, 1959, so as to remove it from the reservation.
• Whether or not Payumo's evidence established the open, continuous, exclusive, and notorious possession under a claim of ownership for thirty years required for judicial confirmation of an imperfect title.
• Whether or not the Court of Appeals erred in reversing the trial court and ordering the issuance of a decree of registration in Payumo's favor.

Applicable Provisions

Section 48(b) of the Public Land Act, as amended by Republic Act No. 1942, provides:

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 fide claim of acquisition of ownership, for at least thirty years immediately preceding the filing of the application for confirmation of title except when prevented by war or force majeure, shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this chapter.

This is the very provision on which Payumo's claim rests, and its thirty-year requirement must be satisfied before the application is filed.

Proclamation No. 599 of the President of the Philippines, dated June 23, 1959, provides:

Reserving for the Angat River Project of the National Power Corporation a certain parcel of the public domain situated partly in the Municipality of Norzagaray, and partly in the Municipality of San Jose, Province of Bulacan, Island of Luzon, subject to private rights.

The saving clause "subject to private rights" is the pivot of the case, because it preserves only rights already vested when the proclamation took effect.

Ruling

On the first issue, the Court held that Payumo had no vested private right when the proclamation was issued. The right of an applicant to alienable lands of the public domain does not become absolute until he has complied with all the requirements of the law. Since the thirty-year requirement had not been satisfactorily proven as of October 1959, Payumo had not established a conclusive right exempting him from the proclamation.

On the second issue, the Court found the evidence wanting. Payumo's claim of continuous, exclusive, and uninterrupted possession was negated by the running dispute with the Castillos over possession, which had culminated in a Court of Appeals decision declaring the land public land. He declared the property for tax purposes only in October 1959, when he filed his application, although he could have done so in 1937. Palad's pretended ownership was never satisfactorily established, and the notarized deed of sale was never presented. Significantly, in the earlier case Payumo testified that he had occupied the land for only twenty years and never mentioned acquiring it from Palad; only when he filed the application did he allege the purchase and the tacking of Palad's possession.

On the third issue, the Court held that the Court of Appeals erred in reversing the trial court. The saving clause did not aid Payumo, because whatever interest he had had not yet ripened into a vested right at the time the proclamation was issued.

Doctrine

A claim over alienable land of the public domain does not become a vested right until the applicant has complied with all the requirements of the law. Under Section 48(b) of the Public Land Act, the applicant for judicial confirmation of an imperfect title must prove open, continuous, exclusive, and notorious possession and occupation under a bona fide claim of ownership for at least thirty years immediately preceding the filing of the application. A reservation clause "subject to private rights" in a presidential proclamation protects only rights already vested at the time of the proclamation; it cannot be invoked by one whose claim has not yet ripened. And a running dispute over possession prevents either claimant from availing himself of the thirty-year period, because possession is neither peaceful nor exclusive.

Disposition

The Supreme Court set aside the judgment of the Court of Appeals and reinstated that of the Court of First Instance of Bulacan, with costs against Payumo.

Remember This

Memorize the line: the right of an applicant to alienable lands of the public domain does not become absolute until he has complied with all the requirements of the law. Examiners use this case to test the "subject to private rights" clause in reservations and the thirty-year requirement under Section 48(b) of the Public Land Act.