EMILIO ZOZOBRADO, PETITIONER, VS. THE HONORABLE COURT OF APPEALS, ROSALIO DURAN AND RESTITUTA T. DURAN, RESPONDENTS.

The case at bar calls simply for the application
of the provisions of Presidential Decrees Numbered 967 and 1304,^[1] amendatory of Republic Act No. 477.^[2]

R.A. No. 477 was enacted for the purpose of providing for the
administration and disposition of properties (including the proceeds and income
thereof) transferred to the Republic of the Philippines under the Philippine
Property Act of 1946 and R.A. No. 8, as well as the public lands (and
improvements thereon) transferred to the National Abaca & Other Fibers
Corporation under Executive Order No. 29 dated October 25, 1946 and Executive
Order No. 99 dated October 22, 1947.

Rosalio Duran applied for and was in due
course awarded on November 13,
1952, a parcel of land in accordance with
the provisions of R.A. No. 477.  The land is situated
in Tacunan, Tugbok,
Davao
City, and has an area of 45,978
square meters.^[3] The award to
Duran carried with it a restriction, set out in Section 8 of the
Act, that the land thus acquired “shall not be subject to encumbrance or
alienation from the date of the award *** and for a term of ten years from and
after the date of issuance of the certificate of title.” The restriction
notwithstanding, Duran and his wife, Restituta,
executed on November 3, 1954 a Deed of Sale of Rights and
Improvements over the parcel of land awarded to them in favor of
Emilio Zozobrado, in consideration of the price of
P3,000.00, and the assumption by Zozobrado of the obligation to pay the balance of the price
of the property to the Board of Liquidators which was in charge of the
implementation of R.A. No. 477.^[4]

Zozobrado took possession of the land
and planted coconut trees and other seasonal crops thereon.  He
paid the realty taxes corresponding thereto in the name of Duran, and completed
payment of the price of the land to the Board of Liquidators pursuant to the
agreement between said Board and Duran.  He succeeded in causing
the issuance of a sales patent (No. 523) over the property, in the
name of Rosalio and Restituta Duran, on May 19, 1966, and the
registration thereof in the Registry of Deeds on September 2,
1967.

After the sale, Duran and his family left
Davao
City, residing first at
Bohol and later, at Zamboanga.  He did not return to
Davao
City until 21 years
later, in 1975.^[5]

On Duran’s return to Davao
City in 1975,
Zozobrado requested him to execute the
necessary deed of conveyance so that the title to the property might be finally
placed in Zozobrado’s name.^[6] Duran’s response could not but have
dismayed Zozobrado.  Duran not only
refused Zozobrado’s request; he procured the release
to himself by the Register of Deeds of the title to the property, despite Zozobrado’s objections, and even offered the land for sale
to a certain Nilo Besa who,
however, refused to deal with him on learning of the previous sale of the same
property to Zozobrado.^[7]

Duran capped his perfidy by instituting, on November 3, 1975, a
suit against Zozobrado, for declaration of ownership,
quieting of title, recovery of possession and damages, alleging that he had been
paying the real estate taxes on the property; that in 1970 he had paid Zozobrado the sum of P7,200.00 purportedly covering
reimbursement of the price paid by the latter in virtue of the sale to him of
the property in 1954 as well as the value of the improvements introduced by
Zozobrado thereon; that after Duran’s reacquisition of
the land, he had acceded to Zozobrado’s request to be
allowed to stay on the property until he could locate a place to transfer his
residence.^[8]

Duran sought to substantiate these averments by his testimony
during the trial.  But although the Trial Court pronounced him a
“worthy descendant of that biblical character named Ananias“, and declared him “unworthy of credence and
belief,” on the basis of its close observation of his demeanor while
testifying,^[9] said Court nonetheless
felt itself unable to make an adjudication in Zozobrado’s favor in view of the fact that the sale by Duran
to Zozobrado was quite evidently in violation of the
prohibition laid down in Section 8 of R.A. No. 477, earlier adverted to, against
the “encumbrance or alienation (of the land) from the date of the award ** and
for a term of ten years from and after the date of issuance of the certificate
of title.” It therefore rendered judgment on May 3, 1977, the dispositive
portion of which reads as follows:

“IN VIEW OF THE FOREGOING, judgment is hereby rendered declaring the
Deed of Sale of Rights & Improvements marked Exhibit ‘D’ null and void and
ordering defendant to turn over the possession of the Lot No. 21, Psd-32969
covered by Original Certificate of Title No. T-2458 located at Tacunan, Tugbok,
Davao
City, to plaintiffs upon payment of
the sum of THREE THOUSAND PESOS (P3,000.00), AND THE
SUM OF THREE HUNDRED THREE PESOS & 56/100 (P303.56) paid as realty
taxes.

“Defendant’s counterclaim against herein plaintiffs is hereby
disallowed.

“Without costs.”^[10]

This decision the Court of Appeals affirmed in toto on May
2, 1979, on appeal taken by Zozobrado.^[11] The latter moved for reconsideration, but
this was denied on June 27, 1979.^[12] Zozobrado seasonably appealed to this
Court by certiorari, in accordance with Rule 45 of the Rules of
Court.  Emilio Zozobrado has since died,
and been duly substituted in the case by his wife, Petronila Zozobrado.^[13]

There is no question that the execution of the sale in question on
November 3, 1954 was a transgression of the provisions of Section 8 of R.A. No.
477 prohibiting for a definite period its “encumbrance or alienation.” But said
Section 8 was amended by P.D. No. 968 on July 24, 1976, and again by P.D. No. 1304 on February 24, 1978^[14] to read as follows:

“SEC. 8.  Any provision of
law, executive order, rules or regulations to the contrary notwithstanding, an
applicant who has acquired land pursuant to the provisions of this Act and to
whom a certificate of title has been issued covering such land, may sell, cede,
transfer, or convey his rights and interests therein, including the permanent
improvements on the land, to any interested party; and all previous sales,
transfers, conveyances and encumbrances regarding such land including the
permanent improvements made and consummated prior to July 24, 1976, are hereby
confirmed, ratified an validated.“^[15]

It is clear that the defect in the sale by Duran to
Zozobrado was cured and removed by the above mentioned
presidential decrees; and under the facts, Zozobrado
is entitled to the full ownership of the land in question, as well as to recover
the damages caused to him by the Durans‘ perfidious
acts in attempting to renege on a transaction voluntarily entered into by
them.

WHEREFORE, the appealed judgment is reversed and another
entered, declaring Emilio Zozobrado and Petronila Zozobrado the owners in
fee simple of the land covered by Sales Patent No. 523 issued by
the Board of Liquidators in virtue of the provisions of R.A. No.
477, as amended, as well as by Original Certificate of Title No. T-2458
of the Register of Deeds of Davao City;
commanding the private respondents Rosalio Duran and
Restituta T. Duran, or their heirs, successors or
assigns, to execute a deed of absolute sale ceding, transferring and conveying
full ownership of said land unto and in favor of Emilio Zozobrado and Petronila Zozobrado, or the heirs, successors and assigns of either of
them, free from liens and encumbrances; and ordering said respondents Rosalio Duran and Restituta T.
Duran, solidarily, to pay to Emilio Zozobrado and Petronila Zozobrado, or their heirs, successors and assigns,
P10,000.00 as nominal damages, P5,000.00 as exemplary damages, and
P5,000.00 as attorney’s fees.  Costs
against said private respondents.

SO
ORDERED.

Yap, (Chairman), Melencio-Herrera, Cruz, Feliciano, and Gancayco, JJ., concur.

^[2] Effective June 9, 1950.

^[3] Rollo, p. 29.

^[4] Rollo, pp. 29,
30.

^[5] Rollo, p. 30.

^[6]
Rollo, p. 30.

^[7]
Rollo, p. 30; also, p. 37:  Record
on Appeal.

^[8]
Rollo, p. 37:  Record
on Appeal, pp. 1-4.

^[9]
Rollo, p. 37:  Record
on Appeal, p. 23.

^[10] Rollo, p.
37:  Record on Appeal, p. 25.

^[11] Rollo, pp.
29-34.

^[12] Rollo, p. 35.

^[13] Rollo, pp.
180-181.

^[14] SEE Footnote No. 1,
supra.

^[15] Underlining supplied.