G.R. No. L-23480. September 11, 1979
J.M. TUASON & CO., INC., PETITIONER, VS. HON. COURT OF APPEALS, AND GUILLERMO REÑOSA, RESPONDENTS.
CONCEPCION JR., J.:
Petition for certiorari to review the decision of the
Court of Appeals, Fifth Division[1]
in CA-G.R. No. 29135-R, entitled “J. M. Tuason & Co., Inc.,
plaintiff-appellee vs. Guillermo Reñosa, defendant-appellant”, which reversed
the decision and dismissed the case rendered by the Court of First Instance of
Rizal, Branch V, Quezon City (then Judge Nicasio Yatco) in that case for
ejectment (Civil Case No. Q- 3318), with the following dispositive portion:[2]
“WHEREFORE, judgment is hereby rendered in this case in favor
of the plaintiff and against the defendant, ordering the latter or any person
claiming under him to remove their construction on the property mentioned in
the complaint and described in the plan Exhibit B and to surrender possession
thereof to plaintiff; to pay the sum of P12.00 a month, by way of rentals from
February 6, 1957, until possession of the property is restored to plaintiff,
and for him to pay the costs.
“SO ORDERED.”
It is not disputed that
this case originated as an action for recovery of possession (ejectment)
instituted by the plaintiff (petitioner) corporation against the private
respondent Guillermo Reñosa; that in the trial court, respondent Reñosa
admitted that petitioner corporation is the owner of the disputed parcel of
land covered by T.C.T. No. 1267 of the Register of Deeds of Quezon City on
which respondent constructed his residence on February 6, 1967; that the
portion occupied by the defendant consisted of 100 square meters; and that the
reasonable rental value of the portion of land occupied by respondent is P12 a
month.
Respondent’s defense to
the action for ejectment was that he bought the disputed portion of land from a
certain Capt. Faustino C. Cruz, for the sum of P3,600.00;[3]
that said Faustino C. Cruz acquired the said portion from 3,000 square meters
of land acquired by virtue of a
compromise agreement in Civil Case Nos. Q-135, Q-139, Q-177 and Q-186 of the
Court of First instance of Rizal, Quezon City Branch;[4] and that all in all Faustino C. Cruz sold to
respondent 360 square meters of the 3,000 square meters allegedly allocated to
the former in the compromise agreement.
The trial court ruled in
favor of the petitioner in the ejectment case (Civil Case No. Q-3318) on the
grounds that petitioner is the registered owner of the questioned land (Exh.
A); that as owner, petitioner is entitled to possession as an attribute of
ownership; that respondent’s claim of the right to possess the disputed land
based on purchase of the same from Capt. Faustino C. Cruz who is the supposed
owner of the land by virtue of a compromise agreement is without any legal
basis, for Capt. Cruz was not a party in interest in the said compromise
agreement; that even admitting that said compromise agreement created a
beneficial right in favor of Capt. Cruz because of the agreement that herein
petitioner shall reserve lands (12,000 square meters) for persons including
Capt. Cruz, said beneficial rights were subject to suspensive conditions
(payment to the petitioner of P250,000 and delivery to the petitioner of lots
marked “refund” as well as approved by the National Housing
Commission and the Bureau of Lands of the Subdivision plan covering the entire
property involved in the compromise agreement); and said suspensive conditions
were never fulfilled because the “Deudors”, the other party to the
compromise agreement failed to fulfill said conditions.
Respondent Court of
Appeals in reversing the trial court’s decision based its stand on its firm
belief that the compromise agreement (Exhibit 1) between the petitioner and the
“Deudors” created a valid right in favor of Capt. Cruz to possess the
property in question; that this valid right of possession
was transmitted to private respondent Reñosa when Cruz sold a portion of that
land (360 square meters for P3,600), in 1956, to Reñosa;[5] that
there is no evidence that the Deudors have not complied with the
conditions to be fulfilled under the compromise agreement; that there is no
evidence that the compromise agreement was rescinded or annulled; and that
Capt. Cruz’ right to possess the disputed land being valid and enforceable he
could validly assign the same to respondent Reñosa.
To Our mind, the
principal issue to be resolved in this case is whether or not private
respondent Reñosa’s predecessor in-interest in the disputed property namely,
Capt. Cruz, acquired a valid right to own and possess said land – a right that
he could have legally transmitted to private respondent Reñosa to entitle the
latter to a better right of possession against the admitted registered owner of
the land.
An examination of the
Deed of Sale (Exh. “2”) which is the source and basis of private
respondent Reñosa’s claim of his right to possess the disputed land, readily
shows that the vendor Capt. Cruz claimed to be “the true and sole
owner” of the parcels of land, a portion of which was sold to respondent
Reñosa, “by virtue of the amicable settlement of the case of Deudor, et
al. vs. J.M. Tuason, et al., Civil Case No. Q-135 of the
Court of First Instance, Quezon City.” It is,
therefore, very clear that even Capt. Faustino C. Cruz based his alleged true
and sole ownership of the disputed land on the compromise agreement.
A close scrutiny of
Exhibit “1” immediately reveals in paragraph 8 (c) of the same, that
the value of the lands reserved for the residences of Gov. Alejo Santos, Atty.
Pastor L. de Guzman, and Capt. Faustino C. Cruz (12,000 square meters) which is
P250,000 shall be deducted from the amount that may be due the
“Deudors”. It is further
provided that the certificates of title to the same lands reserved for
the above-mentioned persons shall be issued after delivery to the petitioner of
the lots marked “refund” shall have been effected and the subdivision
plan approved by the National Housing Commission and the Bureau of Lands. The compromise agreement did not provide for
an outright transfer of title to the beneficiaries (including the 3,000 square
meters allotted to Capt. Cruz), but subjected said transfer to suspensive
conditions, namely, deduction of P250,000 from the amount that may be due the
“Deudors”; after delivery to the petitioner of the lots marked
“refund” shall have been affected; and after the subdivision plan is
approved by the National Planning Commission and the Bureau of Lands.
The compromise agreement was entered into on April 10, 1953, and
Capt. Cruz sold the disputed property to private respondent on April 14,
1956. What strikes Us as unexplainable
is why notwithstanding his claim of sole ownership of the disputed land as
vendor in 1956, he did not possess any registered title to the same, if it were
true that he acquired title to the same land as the beneficiary by virtue of
the compromise agreement of 1953. Capt.
Cruz, not being a registered owner of the disputed land at the time, could not
have assigned a better right to private respondent Reñosa. It is obvious that respondent Reñosa never
claimed ownership of the disputed land, and that he admitted petitioner’s
ownership over the same. It is difficult
to assail petitioner’s argument that the respondent Court of Appeals erred in
stating that the original owner of the land in question were the
“Deudors” as even respondent Reñosa never alleged that in his answer
nor presented evidence to that effect.
Respondent Reñosa continuously admitted that petitioner is the
registered owner of the disputed land.
The Torrens Title of petitioner (T.C.T. No. 1267 [137686-Rizal] of the
Registry of Deeds of Quezon City) cannot be assailed, the more so when private
respondent admits petitioner’s ownership of the disputed land, and did not or
cannot show any title to the same either in his name or that of his
predecessor-in-interest Capt. Cruz.
Petitioner called Our attention to the decision of the Court of
Appeals in J.M. Tuason & Co., Inc., et al. vs. Ponciano Hernandez and J.M.
Tuason & Inc. vs. Rubillo San Diego, CA-G.R.
Nos. 26696-R and 26697-R, promulgated January 31, 1963, wherein said
Appellate Court repudiated the claims in this case of private respondent
Reñosa, thus:
“It is true that under Exh. 1, plaintiff agreed to reserve for
the residence of said captain (Captain Cruz) 3,000 square meters of land
consistent with the subdivision plan that may be finally approved but the fact
remains that the location of this 3,000 square meters lot is indefinite, still
to be designated and reserved in the future, and other than the uncorroborated
testimony of Faustino Cruz, which is, however, contradicted by the testimony of
plaintiffs surveyor there is practically no evidence showing that said
plaintiff had designated and actually reserved for Cruz the 3,000 square meters
lot mentioned in the compromise agreement.
No subdivision plan that has been finally approved and attesting to the
testimony of Faustino Cruz was adduced in evidence. On the other hand, the obligation of the
plaintiff to reserve 3,000 square meters of land for Capt. Cruz arises only
after the delivery to the owners of the lots marked refund in Annex C shall
have been effected and the subdivision plan approved by the National Planning
Commission and the Bureau of Lands (Exh. 1, Item C, p. 6). However, it has not been shown that this
condition precedent has been complied with. On the contrary, we have reasonable ground to
believe that the Deudors failed to perform their part of the agreement, so
much so that in the above cited case of Deudors, et al. vs. J.M. Tuason &
Co., Inc., the Supreme Court rescinded the compromise agreement and released
herein plaintiff from its obligation arising therefrom.” (Underlined
for emphasis)
“This decision was affirmed by the Supreme Court when it
dismissed the petition for certiorari to review the same.” (G.R.
Nos. L-21094 and 21047, Resolution dated April 22, 1963).
We are inclined to adhere
to the aforementioned view, taking into consideration the fundamental principle
in law applicable to the circumstances of this case that mere possession of
whatever length cannot defeat the imprescriptible title to the holder of
registered Torrens Title to real property, and that registered real property
under the Torrens system cannot be acquired by acquisitive prescription.[6] The
petitioner who is the registered owner of the disputed land has a right to
possess and recover the same, as against private respondent Reñosa who merely
claims a right to possess from his predecessor-in-interest Capt. Cruz
who likewise never acquired any right to possess the disputed property. Both Capt. Cruz and respondent Reñosa cannot
be considered exactly as possessors in good faith because both of them knew at
the time they entered into possession that petitioner was the registered owner
of the disputed land. Capt. Cruz cannot
be considered a possessor in good faith because as beneficiary of the
compromise agreement he should be in a position to know that there were
suspensive conditions attached to his possible acquisition of the disputed
property and that if the conditions were not fulfilled his right as beneficiary
would never arise. Aside from the
compromise agreement as the only basis of Capt. Cruz’ alleged right to the
property in question, he and respondent Reñosa were never able to prove
transfer of ownership of the same from petitioner to Capt. Cruz, thus
strengthening the obvious fact that the suspensive conditions imposed in the
compromise agreement were never fulfilled and hence petitioner never
transferred title to the reserved properties in favor of the beneficiaries
therein. As registered owner of the land
and in the absence of any equal or better right on the part of respondent
Reñosa to possess the disputed land, petitioner is entitled to possession and
initiated the correct action when it brought Civil Case No. Q-3318 to recover
possession of the same.
WHEREFORE, the decision of the respondent Court of Appeals
in CA-G.R. No. 29135-R is hereby reversed and set aside and the decision of the
Quezon City Court of First Instance in Civil Case No. Q-3318, revived and
affirmed, with costs against private respondent Guillermo Reñosa.
SO ORDERED.
Barredo, (Chairman), Antonio, Aquino, and Guerrero, JJ., concur.
Abad Santos, J., took no part.
Santos, J., is on leave.
[1]
(then Associate Justices Magno S. Gatmaitan, Eugenio Angeles, Juan L. Lanting)
[2]
Record on Appeal, p. 27.
[3]
Deed of Sale, Exh. 2.
[4]
Exhibit 1.
[5]
See Exhibit 2.
[6]
Art. 1126, Civil Code, Sec. 46, Act 496, Land Registration Act.