THE DIRECTOR OF LANDS, PETITIONER, VS. GREGORIO ABIERA, ET AL., CLAIMANTS. FRANCISCO MERECIDO, ET AL., MOVANTS AND APPELLANTS, VS. FIDEL MERECIDO, OPPOSITOR AND APPELLEE.

On August 20, 1941, judgment was rendered in Cadastral Case No. 15 of
the Court of First Instance of Negros Oriental, G. L. R. 0. Rec. No.
358, adjudicating Lot No. 3725 of the Cadastral Survey of Sibulan,
province of Oriental Negros, to Pilar Merecido. On December 11, 1942,
Pilar Merecido died intestate, single, and without issue.

More than eleven years thereafter, or on July 24, 1954, after the said
judgment had become final but with the corresponding decree of
registration not yet issued, Francisco Merecido, a surviving brother of
the deceased, for himself and in representation of his brothers,
Julian, Fidel and Gerardo, as well as the children of another brother,
Victorio, and of a sister, Damiana, both of whom are also deceased,
filed a motion in the cadastral case praying for the amendment of the
decision of August 20, 1941 so as to adjudicate Lot No. 3725 in their
favor as heirs of the deceased Pilar Merecido. The motion was opposed
by the three brothers aforementioned, namely, Julian, Fidel and
Gerardo, as well as by Rodriga de la Cruz, one of the two children of
the deceased Damiana, alleging that they had not authorized Francisco
Merecido to file the motion for amendment in their behalf and that with
the exception of Fidel Merecido they are no longer entitled to any
portion of Lot No. 3725, Fidel being the exclusive owner thereof by
virtue of a deed of sale executed by Pilar in his favor. A separate
petition was, likewise, filed by Fidel Merecido alone, asking that the
decision of August 20, 1941 be amended by making himself the sole
adjudicatee of the property. This petition was, in turn, opposed by
Francisco Merecido, who alleged that the deceased Pilar Merecido never
sold the property in question.

After hearing, the trial
court handed down an “Amended Decision”, finding that the alleged sale
of Lot No. 3725 to Fidel Merecido by the now deceased Pilar Merecido
had been established by a preponderance of the evidence and ordering
the amendment of the decision of August 20, 1941 in accordance with the
former’s prayer in his petition. A motion for reconsideration was
thereafter filed by Francisco Mercido on the grounds that the evidence
is insufficient to justify the decision and that the trial court,
sitting as a cadastral court, had no jurisdiction to pass upon and
adjudicate the issue of whether the contract of sale in dispute was
really entered into. The motion having been denied, Francisco Merecido
and his co-movants appealed to the Court of Appeals. In their appeal,
they questioned in several assignments of error the sufficiency and
admissibility of evidence regarding the alleged sale of the land in
controversy, but as they also challenged the jurisdiction of the trial
court, and the Court of Appeals having found that the question of
jurisdiction is “one of substance” the case was certified to this Court.

We find merit in the appeal. Under section 29 of Act No. 496, as
amended, the land subject of the cadastral proceedings may, prior to
the issuance of the decree of title, be dealt with, and the cadastral
court, at the instance of the interested party and after notice, may
order the land registered subject to the encumbrance created by the
instrument relating thereto “or order the decree of registration issued
in the name of the buyer or of the person to whom the property has been
conveyed by said instrument.” (See Government of the Philippines vs.
Abad and Molino, 103 Phil., 725; 55 Off. Gaz. [11] 1916.) We are of the
opinion, however, that the cadastral court may only order such decree
of registration where there is no serious controversy between the
parties as to the validity of the instrument affecting the land. This
is so, because in the exercise of its jurisdiction over a cadastral
case, the Court of First Instance, acting as a cadastral court or a
court of land registration, has limited authority. It has no authority
to adjudicate issues that should be ventilated in an ordinary civil
action, such as the question of whether the contract of sale here in
dispute was really entered into. As held in the case of Government of
the Philippines vs. Abad and Molino, supra, “It cannot
determine whether exhibit F reflects or not the true agreement between
the parties thereto or whether the execution thereof is tainted with
fraud. Much less may it render judgment for the payment of a sum of
money, for the use and occupation of the land in question. Obviously,
these matters should be the subject of an ordinary action and are
beyond the province of the cadastral court.” And in the recent case of
Rehabilitation Finance Corporation vs. Alto Surety &
Insurance Co., Inc. (107 Phil., 386), this Court said, “The proceedings
provided in the Land Registration Act being, summary in nature, they
are inadequate for the litigation of issues properly pertaining to
ordinary civil actions; thus, questions involving ownership of or title
to a real property, or relating to the validity or cancellation or
discharge of a mortgage should properly be ventilated in an ordinary
proceeding.”

The motions for amendment filed in this case
are based upon rights derived from those of the adjudicatee and not in
derogation thereof. Said rights being contested, they should—following
the principle laid down in the decision above cited—properly be
ventilated in an ordinary civil action, leaving the judgment untouched
and allowing it to proceed to the final phase of registration, namely,
the entry of the decree and the issuance of the certificate of title.

Wherefore, the “Amended Decision” and the proceedings and orders
complained of are hereby annulled, and the decision of August 20, 1941
reinstated. With costs against the appellee Fidel Merecido.

Montemayor, Bautista Angelo, Labrador, Concepcion, Reyes, J. B. L., Endencia, and Barrera, JJ., concur.