THE DIRECTOR OF LANDS, PETITIONER, VS. HON. EDUARDO R. BENGZON, CFI OF BATANGAS AND DYNAMARINE CORPORATION SUBSTITUTED BY ENGINEERING EQUIPMENT, INC. (EEI), RESPONDENTS.

This is a petition for review on certiorari filed by the
Director of Lands from a decision dated May 7, 1980 of the Court of First
Instance of Batangas, Branch I in Land Registration Case No. N-900, LRC, Rec.
No. N-46755 entitled “Dynamarine Corporation substituted by Engineering
Equipment, Inc., (EEI), Applicant, versus The Director of Lands, et al.,
Oppositors.”

The facts of the case are as follows:

On February 10, 1975, Dynamarine Corporation filed an application
with the lower court for the registration and confirmation of its title to the
following properties:

“Ten (10) parcels of land, situated in the Barrio of Sta.
Maria, Municipali­ty of Bauan, Province of Batangas.  The boundaries of said parcels are as
follows:

1.   A parcel of land (Lot 1, plan PSU-238719-Amd).  Bounded on the NE, by the Sta. Maria River
and property of the Heirs of Pedro Corona; on the SE., by the Batangas Bay; on
the SW. by property of the Heirs of Herbert M. Peterson, Jr., and on the NW. by
Lot 3.  Point ‘1’ is S. 69 deg. 28′ W.,
4145.24 M. from BLLM 1, Bauan, Batangas. 
Area:  ONE THOUSAND TWO HUNDRED
SIXTY ONE (1,261) SQUARE METERS, more or less.

2.   A parcel of land (Lot 2, plan
Psu-238719-Amd.).  Bounded on the NE, by
property of Angel Aguila; and on the SE. W. and NW. by the Sta. Maria
River:  Point ‘1′ is S. 69 deg. 07’W.,
4107.64 m. from BLLM 1, Bauan, Batangas, Area: 
TWO THOUSAND TWO HUNDRED FOURTEEN (2,214) SQUARE METERS, more or less.

3.   A parcel of land (Lot 3, plan
Psu-238719-Amd.).  Bounded on the SW. by
the Sta. Maria River and Lot 1; on the SW. by property of the Heirs of Herbert
M. Petersen, and on the NW. by Lot 4, Point ‘1′, Bauan, Batangas.  Area: 
ONE THOUSAND FIFTEEN (1,015) SQUARE METERS, more or less.

4.   A parcel of land (Lot 1, plan
Psu-04-001036).  Bounded on the N. by Lot
2; on the E. by property of Dynamarine Corporation; on the S. by the Batangas
Bay; on the W. by property of Pedro Manage; and on the NW. by property of
Basilia Arevalo.  Point ‘1′ is S. 69 deg.
02’W., 4274.20 m. from BLLM 1, Bauan, Batangas. 
Area:  EIGHT HUNDRED SIX (806)
SQUARE METERS, more or less.

5.   A parcel of land (Lot 3, plan
Psu-04-001036).  Bounded on the S. by
property of Dynamarine Corporation; on the S. by Lot 2; on the SW., by property of Basilia Arevalo; and on the NW. by
Lot 4.  Point ‘1′ is S. 69 deg. 36’W.,
4295.60 m. from BLLM 1, Bauan, Batangas, Area: 
FOUR HUNDRED SIXTY ONE (461) SQUARE METERS, more or less.

6.   A parcel of land (Lot 4 plan
Psu-04-001036).  Bounded on the NE. by
properties of Aurora P. Silang and Dynamarine Corporation; on the SE. by Lot 3;
on the SW. by properties of
Basilia Arevalo, Pedro Silang and Felipe Marquez; and on the NW. by property of
Lolita Panopio.  Point ‘1’ is S. 69 deg.
44’ N., 4265.30 m. from BLLM 1, Bauan, Batangas.  Area: 
ONE THOUSAND SEVEN HUNDRED TWENTY SIX (1,726) SQUARE METERS, more or
less.

7.   A parcel of land (plan Psu-239681).  Bounded on the NE. by properties of Filomino
Hernandez, Emilio Medrano and Pedro Corona; on the S. by the Batangas Bay; on
the SW. by properties of the Heirs of Rose Panopio and Pascual Silang &
Maria Panopio; and on the NW. by the Provincial Road.  Point ‘1’ is S. 71 deg. 05’W., 4166.50 m.
from BLLM 1, Bauan, Batangas.  Area:  FIVE THOUSAND (5,000) SQUARE METERS, more or
less.

8.   A parcel of land (Lot 2, plan
Psu-04-000989).  Bounded on the NE. by
property of the Heirs of Herbert M. Petersen, Jr., on the S. by the Batangas
Bay; on the SW. by property of Encarnacion, Maria and Vicente Panopio; and on
the NW. by Lot 1.  Point ‘1’ is S. 70
deg. 29’W., 4194.60 m. from BLLM 1, Bauan, Batangas.  Area: 
THREE THOUSAND EIGHT HUNDRED NINETY THREE (3,893) SQUARE METERS, more or
less.

9.   A parcel of land (Lot 1, plan Psu-239680
Amd.).  Bounded on the NE. by property of
the Heirs of Rose Panopio (before) Dynamarine Corporation (now); on the SE. by
Lot 1; on the SW. by properties of the Heirs of Teodora Ilagan, Aniceto
Panopio, Heirs of Ambrosio Panopio and Maximo Panopio, and on the SW. by
property of Aurora Silang.  Point ‘1’ is
S. 70 deg. 29’W., 4256.89 m. from BLLM 1, Bauan, Batangas.  Area: 
FIVE THOUSAND THREE HUNDRED TWENTY SEVEN (5,327) SQUARE METERS, more or
less; and

10. a parcel of land
(Lot 2, plan Psu-239680 Amd.).  Bounded
on the NE. by property of the Heirs of Rose Panopio (before) Dynamarine
Corporation (now); on the S. by Batangas Bay; on the SW. by property of the Heirs of Teodoro Aniceto and Melchor
Panopio and Heirs of Teodora Ilagan; and on the NW. by Lot 1.  Point ‘1′
is S. 70 deg. 29’W., 4256.89 m.
from BLLM 1, Bauan, Batangas.  Area:  FOUR THOUSAND FIVE HUNDRED FORTY SIX (4,546)
SQUARE METERS, more or less.”^[1]

Except for one lot which was acquired by exchange, the
above-described properties were acquired by Dynamarine Corporation by purchase
on the following dates:

Before acquisition by the Dynamarine Corporation, all the lots in
question have been in the possession of the corporation’s
predecessors-in-interest for more than thirty years, to wit:

On April 3, 1978, as security for banking and credit facilities
granted to it, a “Real Estate Chattel Mortgages” covering the lots in
question was executed by Dynamarine Corporation in favor of Citibank, N.A. and
the Manila Banking Corporation.  Later,
these Mortgages were fore­closed and the properties were sold at public auction
wherein the Manila Banking Corporation was the highest bidder.^[4]

On October 10, 1978, Dynamarine Corporation, for valuable
consideration, executed a Deed of Assignment of Redemption Rights^[5]
in favor of Engineering Equipment, Inc. (heretofore called respondent
corporation), covering its redemption rights over the lots.  Subsequently, the Manila Banking Corporation
executed a Deed of Assignment^[6]
covering the same lots in favor of respondent corporation.

On August 2, 1979, the lower court issued an order allowing the
substitution by respondent corporation of Dynamarine Corporation as applicant
in the case.

After hearing the witnesses and reception of evidence, the lower
court on May 7, 1980 rendered the questioned decision decreeing the registration
of the ten parcels of land in favor of respondent corporation.  The dispositive portion is as follows:

“IN VIEW OF THE FOREGOING CONSIDERATIONS, and finding the
application for registration and grant of title under Act 496 as amended, to be
well-founded and fully substantiated by evidence sufficient and requisite under
the law, the Court hereby decrees the registration of the aforementioned ten
(10) parcels of land, shown in the plans Psu-239681 (Exh. ‘H’); Psu-04-000989
(Exh. ‘N’; Psu-04-001036 (Exh. ‘T’); Psu-239680 (Exh. ‘JJ’); and Psu-238719
(Exh. ‘MM’), and more particularly described in the Technical Descriptions
(Exhs. ‘K’, ‘R’, ‘W’, ‘X’, ‘Y’, ‘NN’, ‘00′, ‘00-1′, and ‘00-2′, all situated in
the barrio of Sta. Maria, Municipality of Bauan, Province of Batangas,
Philippines, in favor of herein-applicant ENGINEERING EQUIPMENT, INC., (EEI),
with principal office address at 391 J. Rizal Street, Mandaluyong, Metro
Manila.

Once this decision shall have become final, let an order be issued
directing the Commissioner of land Registration Commission, Quezon City, to
issue the corresponding decree.

SO ORDERED.”

The said decision was based on the following findings of the
lower court:  that the subject properties
are ancestral properties transferred hereditarily from ancestors to
descendants;^[7]
that respondent corporation owned and possessed the subject properties under a bona–fide claim of ownership;^[8]
and, that by itself and through predecessors-­in-interest, respondent
corporation had been in open, peaceful, continuous, public and uninterrupted
possession of the properties as owner in fee simple for no less than fifty
years.^[9]

In this petition, the Director of Lands assails the lower court’s
decision as being violative of Article XIV, Section 11 of the 1973 Constitution
which reads:

“The National Assembly, taking into account conservation,
ecological, and developmental requirements of the natural resources, shall
determine by law the size of lands of the public domain which may be developed,
held or acquired by, or leased to, any qualified individual, corporation, or
association, and the conditions therefor. 
No private corporation or association may hold alienable lands of the
public domain  except by lease not to
exceed one thousand hectares in area; x x x” (Underscoring supplied.)

Petitioner contends that
under the above constitutional provision, respondent corporation, being a
private corporation, may not acquire the ten parcels of land as they are part of public domain.  In this regard, it is maintained by
petitioner that mere possession for more than thirty (30) years did not vest in
respondent corporation’s predecessors-in-interest any title which could be
transmitted to respondent corporation.^[10] According to him, until public lands are
actually registered, they retain their public character^[11] and it is only after possessor has been
issued a certificate of title that the land can be considered private land.^[12]

To support the
above-mentioned arguments, petitioner cites sections 48(b) and 50 of the Public
Land Act, the pertinent provisions of which read:

“Sec. 48.  The
following-described citizens of the Philippines, occupying lands of the public
domain or claiming to own any such lands or an interest therein, but whose
titles have not been perfected or completed, may apply to the Court of First
Instance of the province where the land is located for confirmation of their
claims and the issuance of a certificate of title therefor, under the Land
Registration Act, to wit: . . .

“(b) Those who by themselves or through
their predecessors-in-interrest have been in open, continuous, exclusive,
and notorious possession and occupation of agricultural lands of the public
domain, under a bona fide claim of acquisition or ownership, for at
least thirty years immediately preceding the filing of the applicationn for
confirmation of title except when prevented by war or force majeure.  These shall be conclusively presumed to have
performed all the conditions essential, to a Government grant and shall be
entitled to a certificate of title under the provisions of this chapter.

“SEC. 50.  Any person or
persons, or their legal representatives or successors in right, claiming any
lands or interest in lands under the provisions of this chapter, must in every
case present an application to the proper Court of First Instance, praying that
the validity of the alleged title or claim be inquired into and that a
certificate of title be issued to them under the provisions of the Land Registration Act.  xxx.”

Petitioner claims that
under the cited laws, respondent corporation may not apply for judicial
confirmation of title to the lands.

Clearly, this petition
raises two basic issues, to wit:  (1)
whether the lands in question are part of the public domain; and (2) whether
respondent corporation may apply for judicial confirmation of said lands.  Both are hereby resolved in favor of
respondent corporation.

The ten parcels of land,
contrary to petitioner’s advancements, are private lands.  In the lower court, it was clearly
proven that respondent corporation’s predecessors-in-interest have been in
continuous and uninterrupted possession of the properties for more than thirty
years before they were acquired by respondent corporation.  By virtue of such possession, said properties
were automatically segregated from the mass of public domain.  Hence, the constitutional prohibition does
not apply.

Petitioner’s position that the properties in question are lands
of the public domain must be rejected as it is directly opposed to the doctrine
laid down in The Director of Lands vs. Intermediate Appellate Court and Acme
Plywood & Veneer Co., Inc.,^[13]
a case squarely in point.  Mr. Justice
Andres R. Narvasa who wrote the opinion stated:

“xxx that alienable public land held by a possessor,
personally or through his predecessors-in-interest, openly, continuously and
exclusively for the prescribed statutory period (30 years under the Public Land
Act, as amended) is converted to private property by the mere lapse or
completion of said period, ipso jure.”

The above is a reaffirmation of the principle established in the
earlier cases of Carino vs. Insular Government,^[14]
Suzi vs. Razon,^[15]
and Herico vs. Dar,^[16]
that open, exclusive and undisputed possession of alienable public land for the
period prescribed by law creates the legal fiction whereby the land, upon
completion of the requisite period ipso
jure and without the need of judicial or other sanction, ceases to be
public land and becomes private property.

We cannot subscribe to the view of petitioner that it is only after
a possessor has been issued a certificate of title that the land can be
considered private land.  In interpreting
the provisions of Section 48(b) of Common­wealth Act No. 1, this Court said in Herico
vs. Dar,^[17]
“xxx when the conditions as specified in the foregoing provision are
complied with, the possessor is deemed to have acquired, by operation of law, a
right to a grant, a government grant, without the necessity of a certificate of
title being issued.  The land, therefore,
ceases to be of the public domain, and beyond the authority of the Director of
Lands to dispose of.  The application for
confirmation is a mere formality, the lack of which does not affect the legal
sufficiency of the title as would be evidenced by the patent and the Torrens
title to be issued upon the strength of said patent.”

This was well-explained in the case of Suzi vs. Razon
wherein it was emphasized that it is not necessary that a certificate of title
should be issued in order that said grant may be sustained by the Courts, an
application therefor being sufficient.

As in The Director of Lands vs. Intermediate Appellate Court
and Acme Plywood & Veneer Co., Inc., We hereby incorporate in this decision the dissent (which became the majority
opinion in the aforementioned case) of then Justice now Chief Justice Claudio
Teehankee in the case of Manila Electric Company vs. Castro–Bartolome^[18] to repudiate petitioner’s contention that
under the Public Land Act respondent corporation, being a corporate entity, may
not apply for judicial confirmation of title. 
Thus,

“‘6. To uphold respondent judge’s
denial of Meralco’s application on the technicality that the Public Land Act
allows only citizens of the Philippines who are natural persons to apply for
confirmation of their title would be impractical and would just give rise to
multiplicity of court actions.  Assuming
that there was a technical error in not having filed the application for registration in the name of the Piguing
spouses as the original owners
and vendors, still it is conceded that there is no prohibition against their
sale of the land to the applicant Meralco and neither is there any prohibition
against the application being refiled with retroactive effect in the name of
the original owners and vendors (as such natural persons) with the end result
of their application being granted, because of their indisputable acquisition
of ownership by operation of law and the conclusive presumption therein
provided in their favor.  It should not
be necessary to go through all the rituals at the great cost of refiling of all
such applications in their names and adding to the overcrowded court dockets
when the Court can after all these years dispose of it here and now.  (See Francisco vs. City of Davao)

The ends of justice would best be served, therefore, by considering
the applications for confirmation as amended to conform to the evidence, i.e.
as filed in the names of the original persons who as natural persons are duly
qualified to apply for formal
confirmation of the title that they had acquired by conclusive
presumption and mandate of the Public Land Act and who thereafter duly sold to
the herein corporations (both admittedly Filipino corporations duly qualified
to hold and own private lands) and granting the applications for confirmation
of title to the private lands so acquired and sold or exchanged.'”

WHEREFORE, in the light of the above, the petition is
DENIED for lack of merit.  No costs.

SO ORDERED.

Teehankee, C.J., Narvasa, Cruz, and
Paras, JJ., concur.

^[1]
Pp. 29-31, Rollo.

^[2]
P. 16, Rollo.

^[3]
P. 113, Rollo.

^[4]
P. 162, Rollo.

^[5]
P. 162, Rollo; Exh. EEE.

^[6]
P. 162, Rollo; Exh. FFF.

^[7]
Page 5, Decision; p. 33, Rollo.

^[8]
Page 17, Decision; p. 45, Rollo.

^[9]
Page 17, Decision; p. 45, Rollo.

^[10]
P. 20, Rollo.

^[11]
P. 23, Rollo.

^[12]
P. 118, Rollo.

^[13]
G.R. No. 73002; December 29, 1986; 146 SCRA 509, 522.

^[14]
42 Phil. 935.

^[15]
48 Phil. 424.

^[16]
95 SCRA 437

^[17]
Citing Suzi vs. Razon, et al., 48 Phil. 424 and Mesina vs. Pineda
Vda. de Sonza, G.R. No. L-14722, May 25, 1960.

^[18]
114 SCRA 799.