MUNICIPALITY OF VICTORIAS, PETITIONER, VS. THE COURT OF APPEALS, NORMA LEUENBERGER AND FRANCISCO SOLIVA, RESPONDENTS.

This is a Petition for Review on Certiorari of the
decision^[*] of respondent Court of
Appeals promulgated on September 29, 1969 in CA-G.R. No. 35036-R (Rollo, p. 11) setting aside the decision^[**] of the Court of First Instance of Negros Occidental, Branch 1, dated September 24, 1964 which
dismissed the complaint for recovery of possession in Civil Case
No. 181-S and declared the cemetery site on Lot No. 76 in Victorias as property of the municipality of
Victorias (Record on Appeal, p. 9).

The dispositive portion of the
questioned decision reads as follows:

“IN VIEW OF THE FOREGOING, the judgment of the lower court is hereby
set aside and another is hereby rendered:

(1)  Ordering the defendant municipality and/or thru
its appropriate officials to return and deliver the possession of the portion of
Lot 76 used as cemetery or burial site to the
plaintiff-appellant.

(2)  Ordering defendant
municipality to pay the plaintiff-appellant the sum of P400.00 a year from 1963
until the possession of said land is actually
delivered.”

Lot No. 76 containing an area of 208,157 sq. meters forms a part
of Cadastral Lot No. 140 (Rollo, p. 11), a
27.2460 ha. sugar land located in Bo. Madanlog, Victorias, Negros Occidental, in the name of the deceased Gonzalo
Ditching under Tax Declaration No. 3429 of Negros
Occidental, for the year 1941 (Exh. “3”, Folder of
Exhibits, p. 22).  He was survived by his widow Simeona Jingco Vda. de Ditching and a daughter, Isabel,
who died in 1928 (TSN, July 1, 1964, p. 7) leaving one offspring, respondent
Norma Leuenberger, who was then only six months old
(TSN, July 1, 1964, p. 34).

Respondent Norma Leuenberger, married to
Francisco Soliva, inherited the whole of Lot No. 140
from her grandmother, Simeona J. Vda. de Ditching (not from her
predeceased mother Isabel Ditching).  In 1952, she donated a
portion of Lot No. 140, about 3 ha., to the
municipality for the ground of a certain high school, and had 4 ha. converted into a subdivision (TSN, July 1, 1964, p. 24).

In 1963, she had the remaining 21 ha. or
208, 157 sq. m. relocated by a surveyor upon request of lessee Ramon Jover who complained of being prohibited by municipal
officials from cultivating the land.  It was then that she
discovered that the parcel of land, more or less 4 ha. or 33,747 sq. m. used by Petitioner Municipality of Victorias, as a cemetery from 1934, is within her property
which is now identified as Lot 76 and covered by TCT No.
34546 (TSN, July 1, 1964, pp.
7-9; Exh. “4”, Folder of Exhibits,
p. 23 and Exh. “A”, Folder of
Exhibits, p. 1).

On May 20,
1963, Respondent wrote the Mayor of Victorias regarding her discovery, demanding payment of past
rentals and requesting delivery of the area allegedly illegally occupied by
Petitioner (Exh. “G”, Folder of Exhibits, p.
15).  When the Mayor replied that Petitioner bought the land she
asked to be shown the papers concerning the sale but was referred by the Mayor
to the municipal treasurer who refused to show the same (TSN, July 1, 1964, pp.
32-33).

On January 11,
1964, Respondents filed a complaint in the Court of First Instance of
Negros Occidental, Branch 1, for recovery of
possession of the parcel of land occupied by the municipal cemetery (Record on
Appeal, p. 1).  In its answer,
petitioner
Municipality, by way of special
defense, alleged ownership of the lot, subject of the complaint, having bought
it from Simeona Jingco Vda. de Ditching sometime in 1934 (Record
on Appeal, p. 7).  The lower court decided in favor of the
Municipality.  On appeal, Respondent appellate Court set aside the
decision of the lower court (Record on Appeal, p. 9); hence, this petition for
review on certiorari.

This petition was filed with the Court on November 6, 1969  (Rollo, p.
2), the Record on Appeal on December
19, 1969 (Rollo, p. 80)). 
On January 5,
1970, the Court gave due course to the petition (Rollo, p. 84).

The Brief for the Petitioner was filed on April 1, 1970 (Rollo, p. 88), the Brief for Respondents was filed on May 18, 1970 (Rollo, p. 92).

On July 8,
1970, the Court resolved to consider the case
submitted for decision without Petitioner’s Reply Brief, Petitioner having
failed to file the brief within the period which expired on June 10, 1970
(Rollo, p. 99).

On motion of counsel for the Respondents (Rollo, p. 104), the Court resolved on June 30, 1972
to allow respondent Francisco Soliva to continue the
appeal in behalf of the estate of respondent Norma Leuenberger who died on January 25, 1972, Respondent
Francisco Soliva having been appointed special
administrator in Special Proceedings No. 84-V of the Court of First
Instance of Negros Occidental (Rollo, p. 110).

In their brief, petitioner raised the following errors of
respondent Court of Appeals:  (Brief for the Petitioner, p.
1–3);

I.

The Honorable Court of Appeals erred in holding that respondents
Norma Leuenberger and Francisco Soliva are the lawful owners of the land in litigation as
they are estopped from questioning the possession and
ownership of herein petitioner which dates back to more than 30
years.

II.

The Honorable Court of Appeals also erred in ordering the petitioner
to deliver the possession of the land in question to the respondents Norma Leuenberger and Francisco Soliva,
by holding that non-annotation on the Torrens Certificate of Title could not
affect the said land when the possession by the petitioner of the said land for
over 30 years and using it as a public cemetery for that length of time are
sufficient proof of purchase and transfer of title and non-annotation of the
Certificate of Title did not render the sale ineffectual.

III.

The Honorable Court of Appeals further erred in ordering the
petitioner Municipality of Victorias to pay the
respondents the sum of P400.00 a year from 1963 until possession is actually
delivered because under the law, an owner of a piece of land has no obligation
to pay rentals as it owns and possesses the
same.

There is merit in the petition.

It is undisputed that petitioner failed to present before
the Court a Deed of Sale to prove its purchase of the land in question which is
included in the Transfer Certificate of Title No. T-34546 in
the name of private respondent Norma Leuenberger.

The pivotal issue in this case is whether or not the
secondary evidence presented by the petitioner municipality is sufficient to
substantiate its claim that it acquired the disputed land by means of a Deed of
Sale.

Under the Best Evidence Rule when the original writing is
lost or otherwise unavailable, the law in point provides:

“Sec. 4.  Secondary
evidence when original is lost or destroyed.  — When the
original writing has been lost or destroyed, or cannot be produced in court,
upon proof of its execution and loss or destruction or unavailability, its
contents may be proved by a copy, or by a recital of its contents in some
authentic document, or by the recollection of witnesses.” (Rule 130, Rules of
Court).

In lieu of a Deed of Sale, petitioner presented a
certificate issued by the Archives Division of the Bureau of Records Management
in Manila, of a page of the
1934 Notarial Register of Vicente D. Aragon with the
following entries:

“Nature of Instrument – Compra venta
2 porciones Terrenos:  Lotes Nos. 140-A y 140-B,
Victorias, Neg. Occ.;
pago por esso despues
aprobacion Jusgado la Insta, Neg. Oc. causa civil
5116 Vendedora: — Simeona Jingco Vda. de Ditching …….. administradora Abint. G. Ditching
Comprador: — Municipio Victorias, Neg. Oc…… por su Pres. Mpal.
Vicente B.
Arnaez Valor: — P750.00 …
Vease copia correspondiente.Names of Persons
Executing/Acknowledging:Simeona Vda. de Ditching
Adm. Abint actuacion especial No.
5116
Jusgado la Insta Neg. Oc.

Vendedora

Vicente B.
Arnaes
Pres. Mpal. Victorias

Comprador

“Witnesses to the Signatures:

Esteban Jalandoni
Gregorio Elizalde

Date:	Month
9	Julio 1934
Fees:	P2.00

Cedulas:

Exenta por
su sexo
P1027880 Enero 26/34 Victorias, Neg. Oc.

Remarks:

En Victorias, Neg.
Oc.
Los anexes A.
y B. estan unidos
solamente en el original de la escritura.”

Respondent Court of Appeals was of the view (Rollo, p. 16) that a mere entry in the notarial register of a notary public of an alleged sale
cannot prove that a particular piece of land was sold by one person to another,
one of the important requirements being the indication of the area and the
technical description of the land being sold.  In the present case,
since no deed of sale could be produced, there is no way of telling what
particular portion of the property was sold to defendant municipality and how
big was the sale of the land conveyed to the defendant municipality.

It will be observed that the entries in the notarial register clearly show:  (a) the nature
of the instrument. — a deed of sale; (b) the subject of the sale – two parcels
of land, Lot Nos. 140-A and 140-B; (c) the parties of the contract — the vendor
Simeona J. Vda.
de Ditching in her capacity as Administrator in Civil Case No.
5116 of the Court of First Instance of Negros
Occidental and the vendee, Vicente B. Ananosa,
Municipal Mayor of Victorias; (d) the consideration
P750.00; (e) the names of the witnesses Esteban Jalandoni and Gregorio Elizado;
and (f) the date of the sale on July 9, 1934.

It is beyond question that the foregoing certificate is an
authentic document clearly corroborated and supported by:  (a) the
testimony of the municipal councilor of Victorias,
Ricardo Suarez, (Original TSN Hearing of September 14, 1964, pp. 12-22) who
negotiated the sale; (b) the testimony of Emilio Cuesta, (Original TSN Hearing of September 14, 1964,
pp. 22-38) the municipal treasurer of said municipality, since 1932 up to
the date of trial on September 14, 1964, who personally paid the amount of
P750.00 to Felipe Leuenberger as consideration of the
Contract of Sale; (c) Certificate of Settlement (Original Exhibits, p. 20) “as
evidence of said payment”; (d) Tax Declaration No. 429 (Ibid., p. 22) which was
cancelled and was substituted by Tax Declaration No. 3600 covering the portion
of the property unsold (Decision, CFI, Neg. Occ. Orig.
Record on Appeal, p. 6) and (e) Tax Declaration No. 3601 (Ibid., p. 23) in the
name of the Municipal Government of Victorias covering
the portion occupied as cemetery.

Tax Declaration No. 3601 shows on its face the boundaries as
follows:

“North – NE – Lot No. 140-C of the Subdivision
South-SW – Lot No.
140-C of the Subdivision
West – NW – Lots Nos. 140-C & 140-B of the
Subdivision.”
The area is 33,747 sq.m.

At the back Exh. 4-A, the sale of a
portion of the lot to the Municipality
of Victorias was clearly explained
as follows:

“Note:  The whole Lot No. 140,
belongs to Norma Leuenberger as evidenced by a
Transfer of Cert. of Title No. 18672.  Portion of this Lot, (30,000
sq. m. was sold to Municipality of Victorias for
Cemetery Site as evidenced by a Deed of Sale executed by Simeona Jingco Vda. de Ditching in favor of the aforesaid
Municipality and ratified by Notary Public Mr. Vicente Aragon under Doc. No.
132; Page No. 2; Book No. 10, Series of 1934.”

At the lowest portion under Memoranda it was explained
that —

“The area under this declaration includes
3,746 sq. meters donated by Mrs. Simeona Jingco Vda. de
Ditching and used as road leading to the cemetery.” (Exh. 4; Original Exhibits, p. 23).

The above-mentioned testimonies and documentary evidence
sufficiently identify the land sold by the predecessors-in-interest of private
respondent.  To insist on the technical description of the land in
dispute would be to sacrifice substance to form which would undoubtedly result
in manifest injustice to the petitioner.

Moreover, it is expressly provided by law that the thing sold
shall be understood as delivered, when it is placed in the control and
possession of the vendee.  (Civil Code Art.
1497).  Where there is no express provision that title shall
not pass until payment of the price, and the thing sold has been delivered,
title passes from the moment the thing sold is placed in the possession and
control of the buyer. (Kuenzle & Streiff vs. Watson &
Co., 13 Phil. 26 [1909]).  Delivery produces its
natural effects in law, the principal and most important of which being
the conveyance of ownership, without prejudice to the right of the vendor to
claim payment of the price. (Ocejo, Perez & Co. v. International Banking
Corp., 37 Phil. 631 [1918]).

Similarly, when the sale is made through a public instrument, the
execution thereof shall be equivalent to the delivery of the thing which is the
object of the contract, if from the deed, the contrary
does not appear or cannot be clearly inferred. (Civil Code
Art. 1498).  The execution of the public instrument operates
as a formal or symbolic delivery of the property sold and authorizes the buyer
to use the document as proof of ownership. (Florendo v. Foz, 20 Phil. 388
[1911]).

In the case at bar it is undisputed that petitioner had been in
open, public, adverse and continuous possession of the land for a period of
more than thirty years.  In fact, according to the
municipal treasurer there are over 1000 graves in the cemetery. 
(Decision, Court of Appeals, Rollo, pp. 11-22).

As correctly observed by Justice Magno
S. Gatmaitan in his dissenting opinion (Rollo, pp. 23-28) in the decision of this case by
the Court of Appeals, the evidence establishes without debate that the property
was originally registered in 1916.  Plaintiff was born only in 1928
and cannot possibly be the registered owner of the original lot 140 at the
time.  Indeed, according to her own evidence, (Exhibit A;
Original Record pp. 1-3) she became the registered owner only in
1963.  Likewise, it is undisputed that in the intestate
estate of Gonzalo Ditching, the grandfather of private respondent Norma Leuenberger, it was her grandmother, Simeona, the surviving spouse of Gonzalo who was named
judicial administratrix.  According to
Norma’s own testimony, Isabel, her mother, died in 1928 (TSN Aug. 12, 1964, p.
34) while Simeona the grandmother died in
1942. (Ibid.) Therefore, as of 1934 when a document of
sale was executed by Simeona in favor of the
municipality of Victorias as indubitably shown in the
notarial register (Exhibit 5-A) in question, Simeona was still the administratrix of the properties left by her husband,
Gonzalo and of their conjugal partnership.  Consequently, she is
the only person who could legally dispose of by sale this particular
four-hectare portion of Lot 140.  And so it
is, that in 1934, Simeona Ditching in her
capacity as judicial administratrix made and executed
the document described in the Notarial
Report as Lots 140-A and 140-B, showing clearly that they are portions of the
original big Lot 140.  As this conveyance was executed by the
judicial administratrix, unquestionably the party
authorized to dispose of the same, the presumption must be that she did so upon
proper authority of the Court of First Instance.

As to the description of the property sold, the fact that a notarial report shows that they are portions of Lot 140 and
the property in question occupied by the public cemetery is admittedly a portion
of said lot in the absence of evidence that there were other portions of Lot 140
ceded unto the petitioner municipality, the inevitable conclusion is that the
sale executed in the Notarial Register refers to the
disputed lot.

Unfortunately, the purchaser
Municipality of Victorias failed to register
said Deed of Sale; hence, when Simeona Jingco Vda. de
Ditching died, her granddaughter, respondent Norma Leuenberger claimed to have inherited the land in dispute
and succeeded in registering said land under the Torrens
system.  Said land is now covered by Transfer Certificate of Title
No. T-34036 (Exhibit A, supra) issued by the Register of Deeds of Negros Occidental on March 11, 1963 in the name of Norma
Leuenberger, married to Francisco Soliva, containing an area of 208,157 square meters. 
As registered owner, she is unquestionably entitled to the protection
afforded to a holder of a Torrens Title.

Admittedly, it is well-settled that under the Torrens System,
“Every person receiving a certificate of title in pursuance of a decree of registration, … shall hold the same free of all encumbrance
except those noted on said certificate x x x.” (Sec. 39, Act 496, now Sec. 43, PD 1529).

In the instant case, however, respondent Norma Leuenberger admitted that she inherited the land covered by
Transfer Certificate of Title No. T-34036 from her grandmother, who had already
sold the land to the petitioner in 1934; hence, she merely stepped into the
shoes of her grandmother and she cannot claim a better right than
her predecessor-in-interest.  When she applied for registration of
the disputed land, she had no legal right to do so as she had no ownership of
the land since land registration is not a mode of acquiring ownership but only
of confirming ownership of the land. (Grande,
et al. vs. Court of Appeals, et al., 115 Phil. 521.) “The Torrens
System was not established as a means for the acquisition of title to private
land, x x x” It is intended
merely to confirm and register the title which one may already have
on the land.  Where the applicant possesses no title or
ownership over the parcel of land, he cannot acquire one under the
Torrens system of Registration. (Torela, et al., vs. Torela,
et al., L-27843, October 11, 1979).

While an inherently defective Torrens title may not ordinarily be
cancelled even after proof of its defect, the law nevertheless
safeguards the rightful party’s interest in the titled land from fraud and
improper use of technicalities by allowing such party, in appropriate cases, to
judicially seek reconveyance to him of whatever he has
been deprived of as long as the land has not been transferred or conveyed to a
purchaser in good faith. (Pedro Pascua, et al., vs.
Mariano Gopuyoc, et al., L-23197, May 31, 1977.)

The Civil Code provides:

“Art. 1456.  If the property
is acquired through mistake or fraud, the person obtaining it is, by force of
law, considered a trustee of an implied trust for the benefit of the person from
whom the property comes.”

Thus, it has been held that where the land is decreed in the name
of a person through fraud or mistake, such person is by operation of law
considered a trustee of an implied trust for the benefit of the persons from
whom the property comes.  The beneficiary shall have the right to
enforce the trust, notwithstanding the irrevocability of the
Torrens title and the trustee and his
successors-in-interest are bound to execute the deed of reconveyance. (Pacheco
vs. Arro, 85 Phil. 505; Escobar vs. Locsin, 74 Phil.
86).

As the land in dispute is held by private respondents in trust for
the Municipality of
Victorias,
it is logical to conclude that the latter can neither be deprived of its
possession nor be made to pay rentals thereof.  Private respondent
is in equity bound to reconvey the subject land to the
cestui que
trust, the Municipality of
Victorias.  The
Torrens system was never calculated to foment betrayal in
the performance of a trust.  (Escobar vs. Locsin, 74 Phil. 86).

For a more expeditious disposition of the case at bar, Rule 39 of
the Rules of Court provides:

“SEC. 10.  Judgment for Specific acts; vesting title. — x x x If real or personal property
is within the Philippines, the court in lieu of directing a conveyance thereof
may enter judgment divesting the title of any party and vesting it in others and
such judgment shall have the force and effect of a conveyance executed in due
form of law.”

Finally, the conclusions and findings of fact by the trial court
are entitled to great weight on appeal and should not be disturbed unless for
strong and cogent reasons because the trial court is in a better position to
examine real evidence, as well as to observe the demeanor of the witnesses while
testifying in the case.  (Chase v. Buencamino
Sr., 136 SCRA 365 [1985]).

PREMISES CONSIDERED, the judgment of the respondent
appellate court is hereby SET ASIDE and the decision of the Court of First
Instance of Negros Occidental, Branch I – Silay City in Civil Case No. 181-S declaring the cemetery
site (Exh. E-2) on Lot No. 76 in
Victorias as the property of the
municipality of Victorias, is hereby REINSTATED.  Additionally, We hereby
order (a) the petitioner to have the disputed land segregated by a licensed
surveyor from the rest of Lot No. 76 described in Transfer Certificate of Title
No. T-34036 and to have the corresponding subdivision plan, duly approved by the
Land Registration Commission, submitted to the court of origin for approval; (b)
the private respondents Norma Leuenberger and
Francisco Soliva to be divested of their title to the
disputed land under Rule 39, Sec. 10, Rules of Court; and (c) the Register of
Deeds of Negros Occidental to cancel Transfer
Certificate of Title No. 34036 and issue, in lieu thereof, one title in the name
of the Municipality of Victorias for the disputed land
and another title in the names of the private respondents Norma
 Leuenberger and Francisco
Soliva for the rest of Lot No. 76.  Without costs.

SO
ORDERED.

Fernan, (Chairman), Gutierrez, Jr., Padilla, Bidin, and Cortes,
JJ.,
concur.

---

^[*] Penned by Justice Ruperto G. Martin and concurred in by Justices Julio Villamor and Andres Reyes, with Justices Magno S. Gatmaitan and Edilberto Soriano, dissenting.

^[**] Written by Judge Rafael C. Climaco.