REPUBLIC OF THE PHILIPPINES, PETITIONER, VS. NORTHERN CEMENT CORPORATION, RESPONDENT.

Republic versus Northern Cement

The Case

This is a petition for review on certiorari under Rule 45 filed by the Republic of the Philippines against Northern Cement Corporation. The Republic assails the decision and resolution of the Court of Appeals which affirmed the trial court's grant of Northern Cement's application for original registration of title over a parcel of land in Sison, Pangasinan. The case matters because it is a compact lesson on the burden of proof in land registration: the applicant who anchors his claim on prescription must prove possession of the exact character and duration the law demands, and tax declarations, affidavits of neighbors, and idle cogon land will not do.

Procedural History

Northern Cement filed its application for registration with the Regional Trial Court of Urdaneta City, Pangasinan, Branch 47. The Office of the Solicitor General entered its appearance for the Republic and deputized the City Prosecutor of Urdaneta City. The trial court granted the application, adjudicating the lot in favor of Northern Cement and ordering the registration of title under Presidential Decree Number 1529.

The Republic appealed to the Court of Appeals, arguing that Northern Cement failed to observe the requirements for original registration. The Court of Appeals denied the appeal and affirmed the trial court in full. The Republic moved for reconsideration, but the Court of Appeals denied the motion for raising no new arguments. The Republic then elevated the matter to the Supreme Court through a petition for review on certiorari under Rule 45.

Facts

On June 16, 2000, Northern Cement filed an application for registration of title over a lot of 58,617.96 square meters in Barangay Labayug, Sison, Pangasinan, under Presidential Decree Number 1529. It claimed to be the owner in fee simple, having acquired the lot by a deed of absolute sale dated December 28, 1968 from Rodolfo Chichioco. It alleged that the lot was last assessed at 17,630 pesos and that it was occupying the lot.

To support its application, Northern Cement offered the deed of sale, affidavits of two alleged adjoining landowners stating that Northern Cement owned and possessed the lot, seven tax declarations from 1971 to 2003 in its name and one from 1970 in the name of its predecessor, a tax clearance certificate, a technical description, and an approved plan certified by the Department of Environment and Natural Resources stating that the lot lies inside an alienable and disposable area as classified on November 21, 1927. It also submitted a report of a special investigator of the Community Environment and Natural Resources Office stating that the land is agricultural, not earmarked for public purposes, within the alienable and disposable zone, and that Northern Cement was the actual occupant with the improvement described as cogon.

At trial, Northern Cement's representative testified that it acquired the lot by the 1968 deed of sale, had been paying realty taxes, and that no one else claimed interest in it. Two records and investigation officers of the environment office testified that an investigation was conducted and the records were complete. The trial court granted the application, and the Court of Appeals affirmed.

Issues

• Whether or not the Court of Appeals erred in affirming the grant of the application for registration despite Northern Cement's non-compliance with the requirements of Presidential Decree Number 1529.
• Whether or not Northern Cement proved possession of the lot of the nature and duration required for acquisition by prescription under Section 14, paragraph 2 of Presidential Decree Number 1529 in relation to Articles 1137 and 1118 of the Civil Code.

Applicable Provisions

Section 14 of Presidential Decree Number 1529 provides:

SECTION 14. Who may apply. - The following persons may file in the proper Court of First Instance an application for registration of title to land, whether personally or through their duly authorized representatives: (1) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of alienable and disposable lands of the public domain under a bona fide claim of ownership since June 12, 1945, or earlier. (2) Those who have acquired ownership over private lands by prescription under the provisions of existing laws.

This provision fixes who may apply, and the Court found that the case was tried on the second paragraph, which requires ownership by prescription.

Article 1137 of the Civil Code provides:

Article 1137. Ownership and other real rights over immovables also prescribe through uninterrupted adverse possession thereof for thirty years, without need of title or of good faith.

This supplies the thirty-year period that the applicant under the second paragraph must satisfy.

Article 1118 of the Civil Code provides:

Article 1118. Possession has to be in the concept of an owner, public, peaceful and uninterrupted.

This supplies the character of the possession, which the Court measured against Northern Cement's evidence.

Ruling

The Court granted the petition. It first noted that the application did not state whether it was filed under the first or the second paragraph of Section 14, and that Northern Cement neither alleged nor proved possession since June 12, 1945 or earlier. From the pleadings and the decisions below, the Court concluded that the case was filed and tried under the second paragraph, on acquisition by prescription, and resolved it on that basis.

On the second issue, the Court held that the phrase adverse, continuous, open, public, and in concept of owner is a conclusion of law, and that the burden lies on the applicant to prove by clear, positive and convincing evidence that his possession and that of his predecessors was of the nature and duration required by law. Northern Cement failed to discharge that burden.

First, the seven tax declarations in its name and one in its predecessor's name, for a claimed possession of at least thirty-two years, were intermittent and sporadic assertions of ownership that do not prove open, continuous, exclusive and notorious possession. Tax declarations are not conclusive evidence of ownership but only a basis for inferring possession, and only when coupled with proof of actual possession.

Second, even assuming possession since 1968, the affidavits of the adjoining landowners did not show specific acts of possession and ownership; they merely made the sweeping claim that the lot is owned and possessed by Northern Cement, which is a mere conclusion of law.

Third, Northern Cement failed to prove possession in the concept of an owner. The only improvements on the lot were cogon and unirrigated rice. The Court observed that cogon grass grows casually, hardly has utility, and is usually an indicia that the land is idle, and that unirrigated and uncultivated rice further cements the character of the land as idle. The Court found no allegation or testimony that these were planted or cultivated by Northern Cement.

The Court expressly declined to resolve the issue of whether the land was validly declared alienable and disposable, and whether a further declaration that it is no longer intended for public use is necessary, as the case could be decided on the evident failure to satisfy the required possession.

Doctrine

An applicant for original registration under the second paragraph of Section 14 of Presidential Decree Number 1529 must prove acquisition of ownership by prescription, meaning uninterrupted adverse possession for thirty years under Article 1137 of the Civil Code, possessed in the concept of an owner, publicly, peacefully and uninterruptedly under Article 1118. The burden is on the applicant to prove such possession by clear, positive and convincing evidence, because the description adverse, continuous, open, public, and in concept of owner is a conclusion of law, not a fact presumed from tax receipts. Intermittent and sporadic payment of realty taxes, standing alone, does not establish the required possession; tax declarations are only a basis for inferring possession and must be coupled with proof of actual possession. Affidavits of adjoining landowners that merely conclude that the applicant owns and possesses the land are tenuous. Finally, idle land bearing only cogon grass and unirrigated rice, with no proof of cultivation or acts of dominion by the applicant, does not satisfy the requirement of possession in the concept of an owner.

Disposition

The Court granted the petition, set aside the decision and resolution of the Court of Appeals, and denied Northern Cement Corporation's application for registration.

Remember This

Memorize this line: tax declarations are only a basis for inferring possession, and cogon grass is an indicia that the land is idle, not proof of possession in the concept of an owner. Examiners use this case to test the burden of proof and the character of possession required under the second paragraph of Section 14 of the Property Registration Decree, read with Articles 1137 and 1118 of the Civil Code.