IN RE:  PETITION TO CANCEL TRANSFER CERTIFICATE OF TITLE NO. RT-647 (13474), HU CHON SUNPONGCO, PETITIONER-APPELLEE, VS. HEIRS OF NICOLAS RONQUILLO AND FELIPA SALDARIEGA, MOVANT…

In this appeal from an order of the Court of First Instance of Zamboanga del Norte (Cad. Case No. 2, LRC Cas. Rec. No. 77, Misc. Sp. Proc. No. 1176), the extent of
the jurisdiction of the land registration court is once more put in issue.

The records of this case show that on 27 June 1916, the spouses Nicolas Ronquillo and Felipa Saldariega were adjudged by the Court of First Instance of Zamboanga, sitting as a cadastral court, as ab­solute
owners of Lot No. 419 of the cadastral survey of Dipolog
(Cad. Cas. No. 2, GLRO Cad. Rec. No. 77).  The corresponding certificate in the names of
the said spouses (OCT No. 5736) was accordingly issued on 24 August 1917.

On 2 October 1918, the husband Nicolas Ronquillo
executed a deed of sale with right of repurchase in favor of San Tiao Ong and Cirilo
Sunpongco, by virtue of which the vendor a retro,
his heirs and successors-in-interest undertook to pay to the named vendees the
sum of P2,000.00 within four years, the contract further providing that failure
to make the payment will convert the contract into a consummated absolute
sale.  On the same day, Nicolas Ronquillo appears to have signed another document — a
waiver in favor of San Tiao Ong
and Cirilo Sunpongco of his
right of redemption in connection with the aforementioned pacto
de retro sale.  It likewise appears
in the records that on 30 December 1920, Cirilo Sunpongco ceded his right under the pacto
de retro sale in favor of San Tiao Ong, for the sum of P500.00; and on 29 April 1922, Sun Tiao Ong in turn ceded in favor
of Cirilo Sunpongco all his
rights in the same pacto de retro sale
for P200.00.  Over one year later, on 24 October 1923, the original certi­ficate
of title in the names of the Ronquillo spouses was
cancelled and a new one was issued in the name of Cirilo
Sunpongco (TCT No. 5006).  Then, on 8 April 1941, by order of the land
registration court in the same case, TCT No. 5006 in the name of Cirilo Sunpongco was cancelled
and TCT No. RT-647 (13474) was issued in the names of Hu
Chon Sun­pongco, married to Vlcenta
Debuozet; Hu Chin Sunpongco, married to Victoria Yu; Hu
Lian Sunpongco, single; and
Hu Eng Sunpongco, married
to Yu Sam Poy. 
All the foregoing transactions were duly registered and annotated at the
back of the certificate of title covering Lot No. 419.

On 17 November 1964,
Hu Chon Sunpongco, as one
of the registered owners of Lot No. 419, petitioned the Court of First Instance
of Zamboanga del Norte (in Cad. Case No. 2, LRC Cad.
Rec. No. 77) for the cancella­tion of TCT No. RT-647 (13474), and for the
issuance of a new certificate of title in the names of said petitioner and the
Heirs of Hu Chin Sunpongco,
in equal shares.  It was claimed that two
of the registered owners, Hu Lian
Sunpongco and Hu Eng Sunpongco, petitioner’s sisters, died in Pukian, China,
before the outbreak of the second world war, without issue, whereas the other
co-owner, Hu Chin Sunpongco,
died in Cebu
City, leaving three children,
namely, Aydee Sunpongco, Sim Mon Sunpongco and Mary Sunpongco.  And under
the rules on succession, ownership of the shares of said deceased descended to
their surviving brother, petitioner Hu Chon Sunpongco, and the heirs of Hu
Chin Sunpongco.

On 20 November 1964, the petition was granted; the court ordered
the cancellation of TCT No. RT-647 (13474) and the issuance of another
certificate of title in the names of Hu Chon Sunpongco, married to Vicente Debuozet,
1/2 share, and the Heirs of Hu Chin Sunpongco (Aydee, Sim Mon and Mary, all surnamed Sunpongco),
1/2 share, subject to the pro­visions of Section 4 of Rule 74 of the Revised
Rules of Court.

On 21 December 1964, the Heirs of Nicolas Ronquillo
and Felipa Saldariega filed
in the same case a motion to set aside the court’s order of 20 November 1964,
which allegedly they came to learn only on 1 De­cember 1964 on the grounds that
(1) TCT No. RT-647 (13474) was procured through fraud; (2) petitioner Hu Chon Sunpongco is
incapacitated to hold agricultural lands on account of his Chinese citizenship;
and (3) lack of notice to movants of the hearing of
petitioner’s motion for cancellation of the certificate of title.  Petitioner Hu Chon Sunpongco and one Jim Young, who was allowed to intervene
in the case^[1],
opposed the motion, claiming that the issues of possession and ownership being
raised by the movants properly should be threshed out
in an independent, ordinary civil action and not in the land registration case.

On 12 March 1966, the motion of the Heirs of Nicolas Ronquillo was denied, the court ruling that the matters
brought up by the pleadings of the parties are beyond its jurisdiction to pass
upon.  Thus, movants
interposed the present appeal.

Actually, the issues in this proceeding are few and simple, viz.,

(a)  
Whether or not the court below acted correctly,
in denying appellants’ motion for lack of jurisdiction, and

(b)  
In ordering the cancellation of TCT No. RT-647
(13474) and the issuance of new certificate of title in the names of Hu Chon Sunpongco and the Heirs
of Hu Chin Sunpongco.

The lower court’s order, to cancel TCT No. RT-647 (13474) and to
issue another one in lieu thereof, was evidently made pursuant to Section 112
of Act 496, which confers authority upon the land registration court, after due
determination that the petition is supported by good and valid reasons^[2],
to order the cancellation, alteration or amendment of a certificate of
title.  The rule, however, withdraws from
the court the power to pass upon any question concerning ownership of the regis­tered
property^[3],
or any incident where the issues involved have become controversial.^[4]
In such eventuality, the proper recourse by the parties would be to bring up
said questions in an ordinary civil action^[5]
or in the proceeding where the incident properly belongs.^[6]

In the present case, it may be noted that in moving for
reconsidera­tion of the lower court’s cancellation-order, movants-appellants
charged inter alia that TCT No. RT-642 (13474)
was procured through fraud, and that the registered owners of Lot No. 419 are
Chinese citizens and, there­fore, are disqualified to own the property.^[7]
It is not at all difficult to see that the allegations are not just incidents
or matters of routine in registration of land cases that can be lawfully
disposed of by the court of first instance sitting as a land registration
court.^[8]
Rather, they are issues affecting not only ownership of the land, but even the
qualifications of the persons in whose names the property was found registered
— definitely controversial matters which are beyond the competence of the land
registration court to pass upon.  No
error was committed by the lower court, therefore, when it declared itself
without jurisdiction to entertain the issues presented by the movants-appellants.

As regard appellants’ complaint against the lack of notice to
them of the proceeding for cancellation of the certificate covering Lot.
No. 419, it may be emphasized that under Section 112 of Act 496, notice of
hearing of the petition shall be sent only to all interested parties; but there
is nothing in the records to indicate that prior to the filing of their motion
for reconsideration on 21 December 1964 appellants were ever known or
recognized or considered to have any interests in the property.  Thus, while it may be true that the issuance
of the order cancelling the old title and directing
its substitution with a new one was characterized by some speed and dispatch^[9],
any controversial question that may be raised in connection therewith can not
be brought up in the same special proceeding (Cad. Case No. 2, LRC Rec. No. 77)
by the herein appellants, nor can they establish their right to the land in
that proceeding.  Under the
circumstances, the order cancelling TCT No. RT-647
(13474) and directing issuance of a new one was within the jurisdiction of the
lower court to issue, there being no dispute at the time over the facts alleged
in the petition.

WHEREFORE, the order appealed from is hereby affirmed,
with costs against the appellants.

Concepcion, C.J., on sick leave, did not take part.

Dizon, and
Makasiar, JJ., on
leave, did not take part.

Makalintal, Zaldivar,
Castro, Fernando, Teehankee, Barredo,
and Villamor,
JJ., concur.

^[1]
The intervention was allowed in view of Young’s allegation that he is a buyer
in good faith and for value of one-half a Lot No. 419.

^[2]
Reyes vs. Evangelista, 71 Phil. 487.

^[3] Tomada vs. Tomada, G.R.
No. L-21887, 30 July 1969,
28 SCRA 1026.

^[4]
Register of Deeds of Iloilo vs.
C. N. Hodges, G.R. No. L-18178, 31
January 1963, 7 SCRA 149.

^[5]
Bank of P. I. vs. Ty Camca.,
57 Phil. 801; Castillo vs. Ramos, 78 Phil. 809; Henderson vs. Garrido, 90 Phil. 624.

^[6] Tangunan vs. Republic, G.R. No. L-5545, 29 Dec. 1953; Register of Deeds vs.
C. N. Hodges, supra.

^[7]
Pages 11-18, Record on Appeal.

^[8] Miraflor vs. Leaño, 93
Phil. 496.

^[9] The
petition for cancellation, dated 17 November 1964, was granted by order of the
court of 20 November 1964.