FILMINERA RESOURCES CORPORATION, REPRESENTED BY ITS RESIDENT MANAGER, DANILO S. LATUGA, PETITIONER-APPELLANT, VS. THE REGISTER OF DEEDS, PROVINCE OF MASBATE, RESPONDENT-APPELLEE.

Filminera Resources versus Register of Deeds of Masbate

The Case

This is an appeal by Filminera Resources Corporation against the Register of Deeds of the Province of Masbate, arising from a petition it filed in the Regional Trial Court of Masbate City for the transfer of eleven certificates of title registered in the name of Base Metals Mineral Resources Corporation. Filminera claims that Base Metals is simply its former corporate name, changed by amendment of its articles of incorporation, and that the titles should now stand in its new name. The case matters because it settles two questions every corporation practitioner must know: whether a change of corporate name creates a new juridical person, and what the correct remedy is when the registered owner of land changes its name — a petition for amendment of the certificate under Section 108 of Presidential Decree Number 1529, not a mere presentation of documents to the Register of Deeds.

Procedural History

Filminera filed its petition for transfer of the certificates of title before the Regional Trial Court of Masbate City, Branch 45. The Register of Deeds presented no controverting evidence, and all of the petitioner's exhibits were admitted. The trial court nonetheless denied the petition in an order dated November 9, 2011, holding that Filminera and Base Metals were separate juridical entities and that the remedy was to present the amended articles of incorporation to the Registry of Deeds. Filminera moved for reconsideration, which the trial court denied in an order dated January 3, 2012. Filminera then elevated the matter to the Supreme Court by appeal. The Office of the Solicitor General filed a manifestation in lieu of an appellee's brief, urging the Court to grant the appeal in the interest of substantial justice.

Facts

Base Metals Mineral Resources Corporation was incorporated in 1989 and, in the course of its existence, acquired several parcels of real estate in Masbate, for which eleven certificates of title were issued in its name.

Sometime in February 1999, the incorporators of Base Metals caused the amendment of its articles of incorporation and by-laws, changing among others its corporate name from Base Metals Mineral Resources Corporation to Filminera Resources Corporation. No new corporation was formed; only the name changed.

In November 2010, Filminera filed a petition for the transfer of the eleven certificates of title to its name. It presented the certificates of title, tax declarations, its amended articles of incorporation and by-laws, a director's certificate attesting to the change of name, and the testimony of its lone witness, Jaime Salazar. The Register of Deeds offered no controverting evidence.

Issues

• Whether or not Filminera Resources Corporation is a juridical entity separate and distinct from Base Metals Mineral Resources Corporation.
• Whether or not the remedy of Filminera Resources Corporation is to present the duly amended articles of incorporation before the Registry of Deeds and request that the certificates of title under the name Base Metals Mineral Resources Corporation be transferred to its name.

Applicable Provisions

Section 108 of Presidential Decree Number 1529, the Property Registration Decree, provides:

Section 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 or 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.

This provision supplies the correct remedy: a change in the name of the registered owner requires a petition filed with the Regional Trial Court, which may then order the entry of an amended certificate.

Ruling

On the first issue, the Court held that the trial court erred in treating Filminera and Base Metals as two separate entities. The records showed that Base Metals merely changed its corporate name. Quoting its earlier ruling in Zuellig Freight and Cargo Systems versus the National Labor Relations Commission, the Court explained that the amendment of the articles of incorporation to change the corporate name did not dissolve the former corporation, because amendment is not one of the modes of dissolution under the Corporation Code. The Court adopted the language that the changing of the name of a corporation is no more the creation of a corporation than the changing of the name of a natural person is the begetting of a natural person. It is a change of name, not a change of being. A change in corporate name does not make a new corporation; it has no effect on the identity of the corporation or on its property, rights, or liabilities. The corporation is the same corporation with a different name. The amended articles of incorporation, the director's certificate, and the testimony of the witness all established the change of name.

On the second issue, the Court held that the trial court was incorrect in saying that Filminera had only to show the amended articles of incorporation to the Register of Deeds. Under Section 108 of Presidential Decree Number 1529, a change in the name of the registered owner requires a petition filed with the Regional Trial Court to effect the change on the certificate of title.

The Court acknowledged that Filminera had consistently called its petition one for transfer rather than amendment, and invoked Section 108 only on appeal. While a party may not ordinarily change its theory on appeal, the Court relaxed the rule because the evil sought to be avoided — prejudice to the adverse party — was absent. No new evidence was presented on appeal, the evidence before the trial court all supported an amendment, no rights of third persons were affected, and the Solicitor General itself advocated granting the appeal. Citing Philippine National Bank versus Spouses Manalo, the Court noted that a court may treat a pleading as if it had been amended to conform to the evidence, so long as no surprise or prejudice is caused to the adverse party.

Doctrine

• A change in corporate name does not create a new corporation, whether effected by special act or under the general law. It has no effect on the identity of the corporation or on its property, rights, or liabilities. The corporation remains the same juridical person with a different name.
• Under Section 108 of Presidential Decree Number 1529, a change in the name of the registered owner of registered land is effected by filing a petition for amendment of the certificate of title with the Regional Trial Court, not by simply presenting the amended articles of incorporation to the Register of Deeds.
• As a rule, a party may not change its theory on appeal; but the Court may relax the rule where no prejudice is caused to the adverse party, no new evidence is presented, and the evidence on record supports the relief.

Disposition

The appeal was granted; the trial court's orders were reversed and set aside, and the Register of Deeds of Masbate was directed to issue amended certificates of title in the name of Filminera Resources Corporation.

Remember This

A change of corporate name is a change of name, not a change of being — the corporation remains the same juridical person. Examiners use this case to test the Section 108 remedy for amending a certificate of title when the registered owner changes its name, and the exception allowing a change of theory on appeal where no prejudice results.