VICTOR EUSEBIO, PETITIONER AND APPELLANT, VS. SOCIEDAD AGRICOLA DE BALARIN, ET ALS., RESPONDENTS AND APPELLEES, ARTURO PRONERBO, ET ALS., INTERVENORS AND APPELLANTS.

Direct appeal from the decision of the Court of First Instance of
Nueva Ecija, in its Civil Case No. 3582, denying, after trial, the
petition of the petitioner-appellant, Victor Eusebio, for certiorari
and the petition in intervention of the intervenors-appellants, Arturo
Pronebo, Maria Gonzales, Ana Gonzales, Bernabe Linsangan, Anselmo
Cajucom, Alberto Sacramento, Manuel Azarcon, Rosauro Azarcon, Leonardo
Azarcon, Eugenio Mandia, and Mariano Fajardo, against the
respondents-appellees, Sociedad Agricola de Balarin, Director of Lands
and Secretary of Agriculture and Natural Resources for the said lands
officials’ resolutions in a land conflict over two (2) lots, Nos. 3837
and 3809, Cabanatuan Cadastre No. 51, respectively, containing an area
of 349 and 18 hectares, more or less.

The court a quo found the records bereft of any indication
that the above-named respondents lands officials committed grave abuse
of discretion, or acted erroneously because of imposition, fraud or
mistake, or had denied the petitioner and the intervenors the due
process of law, which are all factual in nature; but the said
petitioner and intervenors pursued their appeal directly to the Supreme
Court, without resorting to the Court of Appeals. They have thus waived
their right to question the trial court’s findings of fact, (Jacinto
vs. Jacinto, et al., L-12313-14, 31 July 1959; Del Castillo vs.
Guerrero, L-11994, 25 July 1960), and this Court will entertain only
the legal issues raised in the appeal, there being no proper showing
that the value of the interests of the parties in the disputed public
lands, subject of the controversy, exceeds P200,000 (Sec. 17, Judiciary
Act, R. A. 296, as amended by R. A. 2613).

The background of the appealed case is narrated by the trial court, as follows:

“On April 10, 1923, the Sociedad Agricola de
Balarin, organized by Jose Moreno Lacalle and others, filed Sales
Application No. 6541 for Lots 3807 and 3809, which application
subsequently included other lots namely * * *   as a result of the
withdrawal, conveyance or relinquishment of rights made by other
applicants or claimants. On May 16, 1924, the Bureau of Lands granted
the Sociedad a provisional permit for which the corresponding permit
fees were paid from 1924 up to 1940. The disputed land was improved and
cultivated by the Sociedad up to the outbreak of the last global war.

“In
July, 1951, Victor Eusebio filed his lease application No. V-29
covering Lot No. 3807 (Exh. A, p. 1, rec. of exhs.). On September 5,
1950, intervenor Maria Gonzales filed a homestead application in lieu
of the pre-war application of her father Bonifacio Gonzales covering a
portion of Lot No. 3809.

“On August 24, 1950, intervenor Arturo Pronebo filed Homestead Application No. V-42997 over a portion of Lot No. 3809.

“On
October 30, 1951 , Assistant Public Land Inspector Andres Banting
submitted his preliminary report to the Director of Lands recommending
that lease application No. V-79 of Victor Eusebio should be rejected as
it refers to a land already covered by the prior and subsisting sales
application No. 6541 of the respondent Sociedad (Exh. B or 2, pp.
258-259, rec.). Said preliminary report was favorably endorsed on
November 15, 1951 by the District Land Officer Antonio Pangilinan, who
recommended to the Director of Lands that the lease application No.
V-79 of the petitioner Victor Eusebio be rejected as it covers a land
embraced by the subsisting sales application No. 6541 of the respondent
Sociedad (p. 259, rec.).

“In an order dated December 4,
1951 , the District Land Officer in Cabanatuan City was directed to
conduct an investigation of the various sales and homestead
applications covering Lots 3807 and 3809 including the sales
application No. V-4054 of Anselmo Cajucom, sales application No. V-5132
of Bernabe Linsangan, homestead application No. V-42995 of Leonardo N.
Azarcon (Exh. C, pp. 260-261, rec.).

“In his report dated
June 30, 1956, Agent Lucas Adeva of the Land Management Division of the
Bureau of Lands, recommended that the lease application No. V-79 of
petitioner Victor Eusebio be allowed to stand over a reduced area of
144 hectares as the portion covered by his clearings, cultivation,
plantings and improvements as of May 21 to 23, 1956 when last inspected
by him; that Maria Pangilinan, wife of Victor Eusebio, be allowed to
acquire by sales application the portion of about 18 hectares
consisting of a portion of Lot 3807 and a portion of the river bed
which was fully cultivated by Victor Eusebio to compensate him for his
huge investment in said portion; that the Sociedad Agricola de Balarin
be sustained in its claim over sub-lots * * * and 3815 (the last
sub-lot 3815 was also covered by sales application No. V-4894 of
intervenor Manuel Azarcon which was recommended to be rejected); and
that, because the other applicants were just recent occupants of the
disputed lots, these applicants should be accommodated in the other
unassigned portion (Exh. D, pp. 2-21, rec. of Exhs.)”

At first, the Director of Lands declared that the Sociedad had
abandoned the contested lots since 1942 up to the time of the
investigation, and, because of the abandonment, numerous persons,
notably Victor Eusebio, had entered upon the lands and introduced
improvements thereon and filed public land applications. The Director,
therefore, in a decision of January, 1957, rejected the Sociedad’s
sales application and giving it due course, as conformably amended,
reserved twenty (20) hectares for a barrio residential and school site,
allocated fifty (50) hectares to the heirs of Jose Lacalle, and the
rest of the area allocated for subdivision into farm-lots to the
present occupants and deserving applicants.

The Sociedad then moved to reconsider, and the Director, upon
re-examination of the record, reversed his prior decision, in an order
dated 20 December 1957, on the ground that the Sociedad’s abandonment
of the lands was caused by the troubled condition during the Huk
movement and, therefore, the apparent abandonment was involuntary. The
Director disposed of the conflict among the several claimants in the
following manner:

“WHEREFORE, it is ordered that the above-mentioned
decision dated January 27, 1957 be, as hereby it is, modified in the
sense that the Lease Application No. V-79 of Victor Eusebio shall be
rejected, forfeiting in favor of the Government whatever amounts has
been paid on account thereof. The Sales Application No. 6541 of the
Sociedad Agricola de Balarin shall be reinstated and amended to include
therein the portion of Lot No. 3807 allocated to Victor Eusebio in his
Lease Application No. V-79, but excluding therefrom the rest of Lot No.
3807 mentioned in the same decision to be subdivided into small farm
lots of not more than five (5) hectares, the area reserved for barrio
and school sites and the lots already patented to other occupants. The
Sociedad Agricola de Balarin shall reimburse the reasonable value of
the improvements of Victor Eusebio within sixty (60) days after it
receives the notice of appraisal to be made by the standing Committee
on Appraisal. Accordingly, the Homestead Application No. V-49749 of
Benjamin Dumalo, the Homestead Application No. 15551 of Bonifacio
Gonzales (Deceased), represented by Maria Gonzales, the Homestead
Application No. V-42997 of Arturo Pronebo, and the Homestead
Application No. V-42269 of Leopoldo Cabuhat are thereby rejected all
forfeiting in favor of the Government whatever amounts have been paid
on account thereof. Thereafter, the aforesaid sales application of the
Sociedad shall be given due course.”

Victor Eusebio moved for reconsideration of the above order, but the
motion was denied on 30 October 1958. He, Arturo Pronebo and Maria
Gonzales then appealed to the Secretary of Agriculture and Natural
Resources. The Secretary dismissed their separate appeals, and affirmed
the Director’s findings but modified the Director’s Order by amending
Sales Application No. 6541 of the Sociedad so as to embrace the whole
of Lot No. 3807, excepting that portion on the southeastern part which
was adjudicated to Victor Eusebio and relieving the Sociedad from the
payment of the value of the improvements introduced by Victor Eusebio
on the said lot, because the latter entered the lot with knowledge of
the prior possession and improvements of the former occupants.

The appellees(herein appellants) moved for reconsideration, but the Secretary denied their motion.

Victor Eusebio then filed the petition for certiorari with the Court
of First Instance of Nueva Ecija on 9 December 1960. On the other hand,
Arturo Pronebo, the heirs of Bonifacio Gonzales, and Anselmo Cajucom
appealed to the Office of the President, but their appeal was,
likewise, dismissed, after which they intervened in the court below in
the present case.

The main legal issue tendered by appellants revolves around the
extinction of the Sociedad Agricola de Balarin, which was organized and
registered as a partnership with the Bureau of Commerce in 1923 by Jose
Moreno Lacalle and others. Sales Application No. 6541 over the
contested lots was made out in the name of the Sociedad as the
applicant. Nothing in the articles of the partnership provided that
upon the death of one of the partners, their heirs may continue with
the partnership; but the heirs of the deceased partners (who had all
died) passed a resolution to continue with the partnership, retaining
the name “Sociedad Agricola de Balarin”, and appointed the widow of
Jose Moreno Lacalle (who died on 31 July 1940) as the manager. The
sales application was pursued under the new set-up.

The appellants contend that the new set-up has no legal interest in
the sales application for lack of personality to succeed the old
Sociedad because the former partnership was dissolved upon the death of
all of the original partners, and the resolution of their heirs to
continue the partnership did not revive it.

There is no question that, under the Civil Code of 1889 then in
force, the death of any one of the partners dissolved the old
partnership (Art. 1700, old Civil Code; Bearneza vs. Dequilla, 43 Phil.
237), the case not being one where there are surviving partners
continuing the partnership with the heirs of deceased partners. Hence,
technically, the old Sociedad Agricola de Balarin organized by Lacalle
and registered in 1923 and the new partnership of the same name and
registered in 1955 are separate and distinct juridical persons.

But the dissolution of the original Sociedad Agricola de Balarin did
not automatically entail the forfeiture of the rights it had acquired
in the lots in dispute, through its improvements and occupancy,
continued without interruption by the heirs of the original partners.
The heirs remained in possession until 1943 when, as a consequence of
war operations and later due to bloody encounters between government
forces and the dissident bands, they had to vacate and stay out until
1951, when the area was declared once more safe for reoccupation and
settlement. It is but equitable, as declared in the decision of the
Director of Lands and of the Secretary of Agriculture, that the heirs
of the original partners, as well as the new association established by
them, should be considered subrogated in place of the original
“Sociedad Agricola de Balaring”, and allowed to continue with the sales
application despite the distinct personality of the heirs’ new
partnership. Under section 105 of the Public Land Act, the heirs-at-law
of a natural person, who dies before the final grant, are subrogated to
his rights and obligations, and entitled to have issued to them the
patent or final concession upon proof of compliance with the
requirements of the law. There is no cogent reason why the provisions
of this section should not be made to apply in favor of the heirs of
the partners of the original Sociedad Agricola, since a partnership is,
in the ultimate analysis, but a collectivity of natural persons banded
together for a common purpose; provided, of course, the aforementioned
heirs cleave to the original ends of the association, as they have done
in this cage.

And there is every reason here to apply section 105 of the Public
Land Act, by analogy, as against appellant Victor Eusebio, since the
administrative authorities found that he entered the lots, applied for
by the Sociedad Agricola, in bad faith, knowing that the same had been
previously occupied and improved by others, who had not abandoned their
rights and had protested against intrusions of other parties. These
findings of fact are conclusive on the courts, as correctly held by the
court below, there being no proof of fraud, imposition, error or abuse
of discretion (Ortua vs. Singson Encarnacion, 59 Phil. 440; Julian vs.
Apostol, 52 Phil. 422; Vda, de Alfara vs. Mapa, 95 Phil. 125; Mari vs.
Sec. of Agriculture, 92 Phil. 411).

At any rate, whether or not the successors of the old Sociedad
Agricola” should be subrogated to its rights and interests is a matter
that lay exclusively within the discretion of the land authorities; and
we see no abuse in their having chosen to do so rather than declare the
land open to new entry by others, considering the improvements already
introduced and the avowed intent of the heirs of the original partners
to proceed with the sales application of their
predecessors-in-interest.

Neither do we find tenable appellants’ charge of fraud and denial of
due process simply because the Director of Lands, after reviewing the
same evidence for the second time, became convinced that his original
decision was erroneous and decided to amend the same. Particularly
since the appellants themselves had the case elevated to the Department
of Agriculture and Natural Resources for review, and the Department,
after due study, concurred in, and affirmed, the Director’s amended
decision in favor of the appellees.

As regards the appeal of the herein intervenors-appellants, the Office of the President, on 15 September 1961, had ruled:

“Lot 309 is claimed by the heirs of Bonifacio
Gonzales and Arturo Pronebo—the first on the ground that they are
the prior applicants, and the latter by virtue of the transfer of
rights over ten hectares in his favor by the said heirs. The said lot
appears to have been previously covered by HA 15551 of Bonifacio
Gonzales and surveyed for him in November, 1923. He then transferred or
relinquished his rights to Vicente Siazon whose assignment of rights to
the Sociedad, in turn, was the basis for the partnership’s supplemental
application to include said lot in S. A. 6541. In a report of Public
Lands Inspector Sotero de la Cruz dated July 22,1926 , the tract was
reported under Vicente Siazon’s HA 947250 and under occupancy by the
Sociedad.”

Upon the above findings, the intervenors-appellants charge that
there is no written instrument submitted in evidence to support the
finding that Bonifacio Gonzales sold, transferred or relinquished his
rights under his homestead application; and that the finding is
contrary to the rule that no evidence is admissible to prove a sale of
realty other than by a written instrument.

This objection is untenable because the Statute of Frauds does not
apply when the case is neither for a violation of a contract nor for
the performance thereof (Facurun vs. Sabanal, 81 Phil. 512; Almirol, et
al. vs. Monserrat, 48 Phil. 67; Pascual vs. Realty Investment, Inc.,
L-4002, 12 May 1952).

The intervenors-appellants also invoke the land for the landless
policy of the government and contend that the grant to the respondent
Sociedad of such a big tract of land, more than 300 hectares in all, is
a violation of the policy. The land authorities, however, did not err
because, as they held, the aforesaid policy does not apply to lands
already occupied and improved by other private persons, unless the
latter are the first duly compensated.

The other issues are factual, hence, as hereinbefore stated,
non-reviewable by this Court in view of the appellants’ direct appeal
from the Court of First Instance to this Supreme Court.

For the foregoing reasons, the appealed decision is hereby affirmed.
One-half (1/2) of the costs shall be taxed against petitioner-appellant
Victor Eusebio and the remaining half of the costs against the
intervenors-appellants.

Bengzon, C.J., Bautista Angelo, Concepcion, Barrera, Regala, Makalintal, Bengzon, J. P., Zaldivar, and Sanchez, JJ., concur.