HEIRS OF ANTONIO CANCERAN, NAMELY: HONORIA, MARCOS, LUIS, EFREN AND SAMUEL, ALL SURNAMED CANCERAN, REP. BY: SAMUEL CANCERAN, PLAINTIFFS-APPELLEES, VS. SHYREEN GUINGAB MALLANAO A…

Heirs of Canceran versus Mallanao

The Case

This is an ordinary appeal brought by the heirs of Antonio Canceran against Shyreen Guingab Mallanao and her grandmother Ponciana Canceran, in an action for specific performance, reconveyance, and damages over a parcel of land in Cabagan, Isabela. The plaintiffs claim that the land was Antonio's share in the extrajudicial partition of Domingo Canceran's estate, that Ponciana fraudulently obtained a free patent and title over it, and that she later transferred the title to her granddaughter Shyreen. The case matters because it gathers in one decision three recurring bar topics: the prescriptive period for an action for reconveyance based on constructive trust, the doctrine of laches, and the belated raising of lack of jurisdiction as barred by estoppel.

Procedural History

The heirs of Antonio Canceran filed a complaint for specific performance, reconveyance, and damages before the Regional Trial Court of Cabagan, Isabela, Branch 22. On September 18, 2009, the trial court rendered judgment in favor of the plaintiffs. It ordered Ponciana to specifically perform the Deed of Reconveyance, ordered Ponciana and Shyreen to reconvey the land to the heirs of Antonio Canceran, and awarded temperate damages of 3,000 pesos plus the cost of suit. The defendants moved for reconsideration, and the trial court denied the motion in its Order dated January 28, 2010. The defendants then filed an ordinary appeal under Rule 41 of the Rules of Court, and the case reached the Supreme Court by that appeal.

Facts

Domingo Canceran originally owned a fifteen-hectare parcel of land in Calibabagan, Cabagan, Isabela. Upon his death, his heirs executed an Extrajudicial Partition of Land dated December 29, 1963, agreeing that a portion on the west side, with an area of 23,911 square meters, would belong to Antonio Canceran. After the partition, Antonio took possession of that portion, cultivated it, and declared it for taxation purposes under his name.

Meanwhile, Ponciana, Antonio's niece, managed to secure a free patent over the very same property and was issued a certificate of title. Antonio promptly filed a protest with the regional office of the Department of Environment and Natural Resources in Tuguegarao City. While the protest was pending, Ponciana executed a Deed of Reconveyance dated November 24, 1988, undertaking to reconvey the property to Antonio as the real owner and possessor. In May 1990, the regional office issued an order giving Antonio a preferential right over the property by virtue of that deed and directing Ponciana to give it full force and effect. Ponciana did not comply. Instead, she transferred the title to her granddaughter, Shyreen Guingab Mallanao.

Antonio died on February 26, 1996, and his heirs took over the possession and cultivation of the land. In May 1997, Shyreen caused the property to be titled in her name. Samuel Canceran immediately filed an Affidavit of Adverse Claim, which was annotated on the original certificate of title. The heirs demanded reconveyance, but the defendants refused, so the heirs filed the complaint.

Issues

• Whether or not the action for reconveyance was filed out of time, having been brought after the lapse of the period fixed by Article 1144 of the Civil Code.
• Whether or not laches had already set in against the plaintiffs.
• Whether or not the Regional Trial Court had jurisdiction over the subject matter of the case, given that the assessed value of the property did not exceed 20,000 pesos.

Applicable Provisions

Article 1144 of the Civil Code provides:

The following actions must be brought within ten years from the time the right of action accrues: (1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment.

The defendants invoke this ten-year period against the action for reconveyance, but the Court holds that it does not apply where the claimant is in possession of the land.

Ruling

On the first issue, the Court held that the action had not prescribed. The property was given to Antonio by his co-heirs through the extrajudicial partition, and Ponciana herself admitted in her Deed of Reconveyance and before the land investigator of the Department of Environment and Natural Resources that the land belonged to Antonio. A neighbor testified that Antonio possessed the land from 1963 and that possession passed to his children, the plaintiffs, without interruption. Since Ponciana knew that the property was owned and possessed by Antonio, her application for a free patent and title was in bad faith. The Court ruled that under such circumstances the period to bring an action for reconveyance does not run, because the claimant is in possession of the land, and the action for reconveyance is in effect an action for quieting of title. The ten-year period applies only when the person enforcing the trust is not in possession of the property.

On the second issue, the Court held that laches had not set in. Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier. The records showed that Antonio took possession immediately after the partition, declared the land for taxation, and lost no time in protesting the free patent. After his death, his children relentlessly pursued the claim, and Samuel caused an adverse claim to be annotated on the title. The plaintiffs had not slept on their rights.

On the third issue, the Court agreed that an action for reconveyance involves title to real property and that jurisdiction lies with the municipal trial court where the assessed value does not exceed 20,000 pesos. Nevertheless, the Court held that the defendants were estopped from raising lack of jurisdiction. They never questioned jurisdiction in the trial court; they filed an answer and actively participated in the trial to the very end, raising the issue only in their motion for reconsideration after an adverse decision. A party who adopts a particular theory and allows the case to be tried and decided on that theory cannot change it on appeal. Justice and equity also demanded that Ponciana suffer the consequences of her fraudulent acts.

Doctrine

An action for reconveyance of real property based on an implied or constructive trust prescribes in ten years, counted from the registration of the deed or the issuance of the certificate of title. This rule, however, applies only when the plaintiff or the person enforcing the trust is not in possession of the property. If the claimant is in actual, continuous, and peaceful possession of the land, the right to seek reconveyance, which in effect seeks to quiet title, does not prescribe. Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier. It does not bar a claimant who has persistently asserted the right. Finally, although lack of jurisdiction over the subject matter may generally be raised at any time, a party who actively participates in the proceedings without questioning jurisdiction, and raises it only after an adverse decision, is estopped from assailing it.

Disposition

The Supreme Court denied the appeal and affirmed the decision and order of the Regional Trial Court, ordering the reconveyance of the land to the heirs of Antonio Canceran.

Remember This

The one line to memorize: an action for reconveyance based on constructive trust does not prescribe when the claimant is in actual possession of the land. Examiners use this case to test prescription and laches in reconveyance, and the estoppel that bars a party from raising lack of jurisdiction for the first time on appeal.