REPUBLIC OF THE PHILIPPINES REPRESENTED BY THE DIRECTOR OF LANDS, PETITIONER, VS. RUFO NERI, JUSTO CHARMEN, AGAPITO GORNOT, PATERNO MADANLO, ADRIAN ARCHIE AND GUILLERMINA VDA. D…

This is a petition for review on certiorari^[1]
which seeks to annul and set aside the June 30, 1980 decision of the Court of
Appeals^[2]
affirming the August 19, 1974 decision of the then Court of First Instance of
Davao^[3]
adjudicating to private respondents the portions of the land in controversy for
which they had laid claims, and ordering the survey of said portions and
thereafter, the issuance of original certificates of title in their names on
the basis of said survey.

The land in question is located in Mati, Davao and has a total
area of 815,320 square meters. It was
allegedly bought by Encarnacion Lamorena between 1920 and 1921 from Bonifacio
Baldomera (or Palmera) and Lucas Lamonte. In 1938, Lamorena filed in the Court of First Instance of Davao
“Expediente No. 291, G.L.R.O. No. 53114,” a petition for registration
of the said 81-hectare land which had been surveyed under Psu-46022, subdivided
and designated as Lots Nos. 1772-A, 1772-B, 1772-C, 1768, 2816, 1775, 1770-A,
1770-B and 2680, Cad. 286.

On October 20, 1938, Lamorena and one Mariano Lamorena, who
appears to be the former’s brother, executed a “deed of sale with right to
repurchase” the same tract of land within one year from November 8, 1938
in consideration of the amount
of P4,112.00 in favor of Baldomera G. Caburian.^[4] The
parties stipulated in the contract that if the vendors should fail to exercise
the right to repurchase, such right would be forfeited and the contract,
without executing another document therefore, would be considered as an
absolute sale and the vendor would abandon and vacate the premises. The parties also agreed that the vendor
would pay the vendee an “annual rental” of P150.00 “payable on
or before November 8, 1939.”

On February 19, 1940, Lamorena filed in “Expediente No.
291” a petition praying for the dismissal of her application for
registration and for a declaration that the land subject of the petition or
application for registration is part of the public domain. Consequently, on March 8, 1940, the court
rendered a decision declaring the area applied for as public land; recognized
Lamorena as the owner and possessor of all the improvements thereon, and
recommended that she be given preference by the Director of Lands in the
acquisition of the said land in accordance with law (“se recomiendo al
Director de Terrenos que conceda preferencia a dicha solicitante en la
acquisition de dicho terreno, de acuerdo con las disposiciones de las ley [sic]
vigente sobre el particular”).^[5]

Sometime in 1946, Caburian, exercising her alleged acquired right
of ownership over the land, demanded from Neri and the others working on the
land, the share of the Lamorenas in its produce. Some complied with the demand but the rest who refused to do so,
were ordered by Caburian to vacate the premises. Hence, on August 25, 1947, Justo Charmen, Adriano Archi (Archie
or Arche), Paterno Madanlo, Fernando Mansilagan, Gervacio Valenteros, Agapito
Gurnot (Gornot), Federico Vargas, Heirs of Francisco Magundag and Gabriel
Palmera, represented by Leopoldo Lopez, petitioned the President to intervene
in their behalf in the controversy. The
Bureau of Lands thereafter investigated the matter. It was found out that the said alleged tenants desired to acquire
the land through homestead applications, Caburian by sales application and the
Lamorenas by free patent applications. The Lamorenas had included two sisters, Carmen and Gloria, as
claimant-applicants just so they could comply with the law limiting each free
patent applicant to a maximum of 24 hectares.

In the decisions all dated October 23, 1951, then Director of
Lands Jose P. Dans dismissed the claim of the homestead applicants on the basis
of his finding that they were either tenants of the Lamorenas or mere
intruders.^[6]
On the other hand, in B.L. Conflict No. 58 (N), the Director of Lands
considered the homestead application of Rufo Neri and rejected the free patent
applications of the Lamorenas on the ground that “Baldomera Caburian has
been subrogated to the ownership of the improvements existing on the land
described in Psu-46022 and to whatever rights the respondents Lamorenas have
acquired to the land in question.”^[7] The
dispositive portion of the decision of the Director of Lands, also dated
October 23, 1951, states:

“IN THE LIGHT OF ALL THE FOREGOING, this Office is of the
opinion, and so decides, that the claims of Rufo Neri to the portion which is
outside of his Homestead Application No. 183913 (E-99319) should be, as hereby
it is dismissed. The Free Patent
Applications (all new) of Encarnacion, Mariano, Carmen and Gloria all surnamed
Lamorena, are hereby rejected.

It appearing that Lot No. 1773 of 0.602 hectares is part of the
Municipal Road and Lot No. 1770-B of 4,000 hectares is needed for a school
site, those lots shall be excluded from the land in dispute.

There being no sales application of Baldomera G. Caburian in the
records of this office, she shall file within sixty (60) days from the date
hereof, another sales application to cover Lots Nos. 1768, 1770-A. 1772-A,
1772-B. 1772-C, 2680, and 2816, Mati Cadastre No. 286, in accordance with the
sketch reproduced at the back hereof, and the application shall be given due
course.

SO ORDERED.”

The homestead applicants and the Lamorenas appealed to the
Secretary of Agriculture and Natural Resources. On July 23, 1952 then Secretary Fernando Lopez dismissed the
appeal of the homestead applicants in view of their failure to file memorandum
in support of their appeal.^[8] It
was on May 3, 1954 that the appeals of Rufo Neri and the Lamorenas were
resolved by then Undersecretary of Agriculture and Natural Resources Jaime
Ferrer.^[9]
The decision emphasized the fact that since Caburian did not question the
decision of the Director of Lands excluding from her sales application the municipal road and the school, said portion
of the decision had become final and executory.

The same decision, quoting the pertinent terms and conditions of
the contract between Encarnacion and Mariano Lamorena and Caburian and noting
the facts that the Lamorenas “failed to
redeem the land in question as well as the improvements thereon in
accordance with the terms of the contract” and that the land had been
declared part of the public domain in the 1940 decision in G.L.R.O. No. 53114,
ruled that the conveyance made by the Lamorenas in favor of Caburian
“should be considered as a transfer only of their possessory right and the
improvements thereon.” The decision also held that the contract between
the Lamorenas and Caburian was one of sale with right to repurchase and not an
equitable mortgage. Accordingly, the
appeals were dismissed.

The Lamorenas elevated the case to the Office of the President on
the sole issue of whether the contract between them and Caburian was a deed of
sale with right to repurchase or an equitable mortgage. In his
decision of January 10, 1958, then Executive Secretary Juan A. Pajo,
acting on the strength of the opinion of the Secretary of Justice, deemed the
contract as one of equitable mortgage and therefore reversed the decision appealed from.^[10]
He directed that “the application of the appellants should be given due
course and free patents granted them if they qualify therefore” but
“without prejudice to whatever action may be instituted in court by the
appellee against the appellants with regard to their contract.”

The decision of the Office of the President having become final
and executory, on June 10, 1959, Director of Lands Zoilo Castrillo ordered its
execution. He specifically directed the
District Land Officer of Davao City “to repair to the premises and enforce
the aforementioned decision of the President, by ordering Baldomera G. Caburian, her tenants, relatives and
all those acting in her behalf to vacate the land in question and placing
Encarnacion, Mariano, Carmen and Gloria, all surnamed Lamorena in possession of
their respective portions.”^[11]

It turned out, however, that Caburian had filed a motion for the
reconsideration of the decision of the Office of the President but in its
“decision” of May 31, 1961, said Office denied it. The records likewise show that earlier, or
on August 5, 1959, Caburian had filed
in the Court of First Instance of Manila a petition for certiorari
seeking the “review” of the decision of the Office of the President.^[12] She obtained a writ of preliminary
injunction enjoining the execution of said decision but upon Lamorena’s filing
a bond, the injunction was dissolved. On May 4, 1961, the court dismissed the petition. Notwithstanding the finality of said
decision, Caburian remained in possession of the land. Hence, on July 31, 1961, Acting Director of
Lands Nicanor G. Jorge issued an order of execution reiterating the earlier
order of execution of Director of Lands Castrillo.

Undaunted, Caburian (now represented by her heir and special
administratrix Guillermina Garcia Vda. de Mitre) elevated the case to the Court
of Appeals.^[13]
In the decision of January 12, 1973,^[14] said
appellate court resolved the issue of whether or not the Office of the President abused its discretion
in requesting the Secretary of Justice for an opinion on the nature of the
contract between Caburian and the Lamorenas when, according to Caburian, said
Office “should have based its decision upon deceit, misrepresentations and bad faith committed
by” the Lamorenas “who allegedly misrepresented the true facts of the
case.” Finding Mrs. Mitre’s allegation as baseless, the Court of Appeals
affirmed the judgment appealed from.

Meanwhile, in 1954, the Director of Lands, in behalf of the
Republic of the Philippines, filed in the Municipal Court of Mati a petition
for registration of a tract of land covering 12,485.8245 hectares designated as
Mati Cadastre No. 286. Docketed as
Cadastral Case No. N-16, the petition was pursuant to Sec. 1855 of the Revised
Administrative Code in relation to Sec. 53 of the Public Land Act (Commonwealth
Act No. 141). The petition alleged that
“no voluntary applications for the registration of the said parcels of
land have been filed under the provisions of Chapter VIII of Commonwealth Act
No. 141, nor under the provisions of the Land Registration Law, and that the
title thereto is uncertain and open to question.”^[15]
From 1959 to 1960, the following claimants filed their cadastral answers: Baldomera Caburian (3 answers), Gloria
Lamorena (3 answers), Paterno Madanlo (3 answers), Justo Charmen, Rufo Neri,
Adriano Arche, Agapito Gornot, the Municipal Government of Mati and Encarnacion
Lamorena (3 answers).

On March 1, 1963, the Solicitor General, appearing for the
Director of Lands filed a manifestation^[16]
stating that by virtue of the decision of March 8, 1940 of the Court of First
Instance of Davao declaring 81 hectares of the land in question as part of the
public domain, the case had become res judicata; that Civil Case
No. 630 for recovery of possession of the same tract of land which was filed by
Caburian against Rufo Neri, et al. in the Municipal Court of Mati had been
dismissed on the ground that the subject matter of the action is public land;
that, having filed public land applications and protests against the
applications of others, the claimants were “now estopped from claiming the
land as their private properties because by their acts, they have recognized
the land in question as public agricultural land”; that the “findings
of facts of the Land Department under the principle of separation of powers
shall not be disturbed by courts of law where there is no showing that there
was grave abuse in the exercise of discretion” and therefore the
administrative finding that Rufo Neri, et al. are tenants should not be
disturbed, and that the Office of the President having resolved the legal issue
of the nature of the contract between the Lamorenas and Caburian, the latter
had lost all rights to and claims of private ownership over the land in
question. The Solicitor General prayed
for the dismissal of the claims of Baldomera G. Caburian, Rufo Neri, Justo
Charmen, Adriano Arche, Paterno Madanlo, Francisco Magondag or his heirs,
Federico Vargas, Gabriel Palmera or his heirs, Pedro Racoma, Fernando
Mansilagan and Agapito Gornot, as well as the claims of Encarnacion Lamorena
“insofar as their claims to the land are of private ownership.”

In their answer to said manifestation, claimants Rufo Neri, Justo
Charmen, Agapito Gurnot, Paterno Madanlo and Adriano Arche disputed the
Solicitor General’s contention that res judicata was applicable
in their case in view of the fact that they were not parties to the case
decided in 1940. Asserting that they
were allegedly forced to enter into a contract of tenancy by Mariano Lamorena,
a Philippine Constabulary Lieutenant, they denied that they were ever tenants
as some of them had been occupying the land as early as 1915 and planting it to
coconuts and root crops without sharing the harvests with anyone. They prayed that the court should
“maintain jurisdiction in the judicial confirmation of (their) imperfect
titles.”^[17]

On May 10, 1963, the court dismissed the claims of Baldomera
Caburian, Rufo Neri, Justo
Charmen, Adriano Arche, Paterno Madanlo, Francisco Magundag or his heirs, Federico
Vargas, Gabriel Palmera or his heirs, Pedro Racoma, Fernando Mansilagan and
Agapito Gurnot as well as that of Encarnacion Lamorena as prayed for by the
Solicitor General in his manifestation. The court held that if none of the claimants in a cadastral proceeding
can prove that he is entitled to his claim, and the land had been declared
public land, the judgment of the Court declaring the land public constitutes res
judicata.^[18]

Claimants Rufo Neri, Justo Charmen, Adriano Arche, Paterno
Madanlo and Agapito Gurnot moved for the reconsideration of said order but upon
the opposition of the Lamorenas, the court struck out the motion from the records.

On January 28, 1964, the Solicitor General filed a motion for the
issuance of a writ of possession. Said motion
was objected to by Rufo Neri, et al. on the grounds that the March 8, 1940
decision was rendered without any trial on the merits and that under Sec. 6 of
the Public Land Act, only the President, upon the recommendation of the
Secretary of Agriculture and Natural Resources, can classify lands of the
public domain and declare them as open for disposition. Asserting that they had been in open and
continuous possession of the land since 1923, Rufo Neri, et al. argued that
they were qualified to acquire public lands suitable for agricultural purposes
through homestead, sale, lease or confirmation of an imperfect title. Moreover, the same claimants contended that
under Evangelista v. Director of Lands,^[19]
the declaration in a cadastral case that certain lands are public is not a
final decree of confirmation and registration within the meaning of Sec. 38 of
the Land Registration Act and that a writ of possession may only be granted
after the finality of a decree of registration adjudicating title to a successful
applicant.^[20]

Rufo Neri, et al. also filed a motion to set aside the order
dismissing their claims. Reiterating
that only the President and not the courts may declare any portion of land as
part of the public domain, they asserted that the March 8, 1940 decision was
null and void for lack of jurisdiction.^[21]

Finding the motion to set aside the order dismissing the claims
of Rufo Neri, et al. to be wanting in merit, on February 17, 1964, the court issued
the writ of possession prayed for by the Solicitor General.^[22]
Upon the latter’s motion, the court modified the order of February 17, 1964 by
specifying in the order of April 13, 1964 that the District Land Officer should
take possession of Lot Nos. 713, 1772-A, 1772-B, 1772-C, 1768, 1775, 1770-A,
1770-B, 2816, and 2685 of Cad. 286, Mati, Davao.^[23]

Alleging that she had not been notified of the orders of May 10,
1963 and April 13, 1964, Guillermina Garcia Vda. de Mitre, representing the
deceased Baldomera Caburian,^[24]
filed a motion for the reconsideration of said orders. She averred that since the said orders were
merely based on the manifestation and motion of the Solicitor General, the
court treated the said pleading as a motion to dismiss. However, she added that a motion to dismiss
is not applicable in cadastral and registration proceedings which demand that
all the parties thereto should be properly notified and heard. She asserted that since she was not a party
in the case which led to the decision of March 8, 1940, she cannot be bound
thereby. She contended that given the
chance, she could prove her claim over the land under Republic Act Nos. 1942
and 931 as amended by Republic Act No. 2061.^[25]

In answer to Mrs. Mitre’s motion for reconsideration, the
Solicitor General contended that the records contain proofs that she had been
notified of the proceedings which led to the issuance of the writ of
possession; that his manifestation, to which were attached several public
documents, should not be considered as a mere motion to dismiss but as a
“continuation of the hearing of the case, particularly with respect to the
issue (of) whether or not the land in question, in a previous proceedings
(sic), had already been declared a public land”; that Caburian has no right or
interest in the land because by filing Sales Application No. V-6937, she was
estopped from claiming that she had been in possession thereof for more than
thirty years; that the decision of
March 8, 1940, a land registration proceeding which is a proceeding in rem, is binding upon the whole world including
Caburian, who, as vendee of the land, is estopped from claiming any right other
than that which came from the vendor; that the issuance of the writ of
possession was in order since the Government of the Philippines, through the
Director of Lands, is the owner of all lands of the public domain in the
absence of proof that the land in question is of private ownership, and the
motion for reconsideration of Mitre should be treated as a petition for relief
from judgment under Rule 38.^[26]

Mrs. Mitre filed a reply
to said answer of the Solicitor General reiterating her claim that she had not
been given her day in court in regard to the issuance of the writ of
possession. Thereafter, she filed a
motion to recall or set aside the orders of February 17, 1964 and April 13,
1964. Mrs. Mitre alleged that said
orders had been brought before the Court of Appeals under CA-G.R. No. 34100-R
on a petition for certiorari and that on August 8, 1964 said appellate
court set aside said orders and directed the lower court to proceed with the
hearing of the cadastral case.^[27]
Inspite of said decision, the Sheriff of Davao allegedly kept on
“molesting” Mrs. Mitre and her overseer by trying to take possession
of the premises and taking the harvests therefrom.

On May 17, 1965, the court issued an order reconsidering its
“order of dismissal of February 8, 1965” (sic) and set the case for
hearing.^[28]

Meanwhile, it appears that Rufo Neri, Justo Charmen, Adriano
Arche, Agapito Gurnot and Paterno Madanlo filed with the Court of Appeals a petition to prohibit Judge Manases Reyes
from recognizing the representation of Lamorena, Caburian and the Municipality of Mati during the trial on the merits
of Cadastral Case No. 16. On December
31, 1965, the Court of Appeals rendered a decision dismissing the petition for
prohibition on the strength of two reasons.^[29]
First, the same court’s decision in CA-G.R. No. 34100-R “completely wiped
out and rendered inexistent the order annex B (issued on May 10, 1964 declaring
the lots as public land and dismissing the claims of Rufo Neri, et al.,
Caburian and Lamorena), and in fact directed the lower court to hear the
cadastral case after the requirements therefore had been complied with.”
Second, the respondents (meaning, Lamorena, Caburian and the Municipality of
Mati) are “real parties in interest in the cadastral case and their
participation therein is necessary for the complete determination or settlement
of the case once and for all.”

In due course, the court below issued a decree dated August 19,
1974^[30]. Placing more probative weight on the
evidence presented by herein private respondents, the court found that the
tenancy relationship alleged by both Lamorena and Caburian was never enforced;
that Lamorena possessed no more than eight hectares of the land in question^[31]
and said area is not even being claimed by the alleged tenants; that Neri, et
al., have been in continuous, open, adverse and notorious possession of the
areas they are claiming except in 1947 when Caburian’s encargado tried
to collect shares from them, and that because Lamorena failed to repurchase the
land she sold to Caburian, the latter became its owner but only with respect to what Lamorena could sell to her. The dispositive portion of the decree reads:

“IN VIEW OF THE FOREGOING, judgment is hereby rendered:

1. Adjudicating to the following actual
occupants the portions with the areas subject of their respective claims as
established by the proofs of record, to wit:

(a) To Juliana
Gornot her occupation of three (3) hectares;

(b) To Rufo Neri,
his occupation of twenty-four (24) hectares;

(c) To Paterno
Madanlo the area occupied by him consisting of three contiguous lots with an
area of nineteen and one-half hectares (19 1/2);

(d) To Justo Charmen,
his occupation with an area of fifteen (15) hectares;

(e) To Adriano
Arche his Occupation of ten (10) hectares;

(f) To Guillermina Vda de Mitre the area of
eight (8) hectares; and

(g) To the
Municipality of Mati, Davao Oriental, the area of two (2) hectares actually
utilized as school site and the cadastral road –

2. Ordering the survey of the different
portions above adjudicated and awarded, the expenses of the survey to be borne
by them pro rata; and

3. Ordering the issuance of original certificates
of title in their respective favor on the basis of the survey directed in the next preceding paragraph.”

From that decision, Encarnacion Lamorena and the Republic of the
Philippines represented by the Director of Lands appealed to the Court of
Appeals. On June 30, 1981, said
appellate court affirmed the decision of the lower court. Hence, the Director of Lands interposed the
instant petition for review on certiorari questioning the power and
authority of the cadastral court to: (a) review and pass upon the administrative decisions rendered by the
Director of Lands which, as affirmed by the Secretary of Agriculture and
Natural Resources, had long become final and executory; (b) review the decision
of the Office of the President finding the transaction between Lamorena and
Caburian to be an equitable mortgage; (c) adjudicate portions of the land in
favor of the respondents inasmuch as they had been found by the Director of
Lands to be mere tenants of either Lamorena or Caburian, and (d) adjudicate portions
of the land to the Municipality of Mati as prescription over public land used
for public purpose does not run
against the State and public lands used
or devoted to public use cannot be registered under the Cadastral Act nor under
the Public Land Act except by executive proclamation.

The first three questions raised by the petitioner boil down to
the basic issue of the applicability of the doctrine of res judicata
in this case. There is no doubt as to
the finality of the decisions of the Director of Lands as affirmed by the
Secretary of Natural Resources by the dismissal of the appeal of the herein
private respondents (except Guillermina Vda. de Mitre) because only the
Lamorenas elevated the case to the Office of the President. Undoubtedly, too, the said administrative
officers had jurisdiction over the subject matter and the parties and that the
decisions on private respondents’ free patent and homestead applications were
on the merit. With regard, therefore, to
said private respondents, they appear to be bound by the decisions of said
administrative officers for, as the Court held in Ysmael, Jr. &
Co., Inc. v. Deputy Executive
Secretary:^[32]

“It is an established doctrine in this jurisdiction that the decisions
and orders of administrative agencies have upon their finality, the force and
binding effect of a final
judgment within the purview of the doctrine of res judicata. These decisions and orders are as conclusive
upon the rights of the affected parties as though the same had been rendered by
a court of general
jurisdiction. The rule of res judicata
thus forbids the reopening of a matter once determined by competent authority
acting within their exclusive jurisdiction.”

However, in the instant petition, the Solicitor General invokes res
judicata with respect to the
final and executory administrative decisions of the Executive
branch. The Solicitor General is not
putting in issue the applicability of said principle with respect to the March
8, 1940 decision of the Court of First Instance of Davao which he did in the
cadastral proceeding below through his manifestation of March 1, 1963. While the Solicitor General raised the issue
of res judicata in the Court of Appeals also with regard to the
said administrative decisions,^[33] the
fact that he raised it only on appeal remains. This fact militates against the case of the petitioner because if the
doctrine of res judicata is not set up seasonably as a defense or
ground of objection, it is deemed waived; it cannot be asserted for the first
time on appeal.^[34]
Perhaps, this is the reason why the petitioner, through the Solicitor General,
does not directly invoke the said doctrine in the instant petition for review
on certiorari. Instead, the
Solicitor General euphemistically questions the authority of the cadastral
court to “review” the final and executory decisions of the
administrative officials concerned.

Res judicata also may not apply with respect to the
decision of the Office of the President finding that the transaction between
Lamorena and Caburian was an equitable mortgage, but for another reason. The decision was solely based on the appeal
of Lamorena but unfortunately, the issue raised therein, i.e., the nature of
the contract between Caburian and the Lamorenas, was a judicial one, over which
the Executive Branch has no jurisdiction.^[35] The
instant cadastral proceeding, therefore, cannot be barred by the final and
executory decision of the Office of the President in the absence of a requisite in the applicability
of the doctrine of res judicata: the Office of the President had no
jurisdiction over the subject matter of the appeal.^[36]
Thus, the court below could have confronted directly the issue of whether or
not the contract between the Lamorenas and Caburian was one of pacto de
retro sale or an equitable mortgage, for it
is within a cadastral court’s power to determine the nature of said document to
avoid multiplicity of suits. Instead of
doing so, however, the court skirted the issue and focused on the facts that
Lamorena actually occupied and could have sold only eight hectares of the land
and that Lamorena cleverly filed the 1940 land registration proceeding only to
have it dismissed later upon her own manifestation that the land is public so
that she could file a free patent application therefore.

The inapplicability of the doctrine of res judicata
in effect allowed the courts below the discretion to pass upon the issue of
whether or not the private respondents herein, including Mrs. Mitre and her
predecessor-in-interest, are bona fide, possessors of the
portions of land they are claiming. Although the power and authority of a cadastral court are circumscribed
by law, it correctly passed upon said issue.

Parenthetically, P.D. No. 1529, the Property Registration Decree,
has eliminated the distinction between the general jurisdiction vested in the
regional trial court and the limited jurisdiction formerly conferred upon it
when acting merely as a cadastral court. Thus, the court may resolve issues other than those strictly pertaining
to land registration in cases (1) where the parties mutually agreed or have
acquiesced in submitting controversial issues for determination; (2) where they
have been given full opportunity to present their evidence; and (3) where the
court has considered the evidence already of record and is convinced that the
same is sufficient for rendering a decision upon such controversial issues.^[37]
Consequently, under the third circumstance, the court below could have properly
determined the nature of the document executed by Caburian and the Lamorenas if
only to avoid multiplicity of suits.

In any case, the lower court correctly adjudicated to the private
respondents the portions of the land subject of their claims. With regard to Mrs. Mitre, the lower court
did not err in adjudicating to her only eight hectares, the actual area
possessed and occupied by the Lamorenas through a tenant and, which is the area
over which the latter could legally transfer their rights. Inasmuch as Baldomera Caburian believed that
she was buying eighty-one hectares from the Lamorenas, her effort, as well as
that of her successor-in-interest, in exhausting all remedies, judicial and
administrative, is understandable. Sadly for her, a sizeable portion of the subject of the sale did not
belong to the vendors.

The petitioner correctly objected to the legality of the
adjudication of two hectares of the land in favor of the Municipality of
Mati. The finding of the cadastral
court that Paterno Madanlo “conceded” or “donated”^[38]
the two hectares to the municipality does not justify its adjudication to the
latter. Madanlo could not have legally
donated a portion of the land the ownership of which was not yet vested in him.^[39]
Apparently, such adjudication was based on the municipality’s long, continuous
and adverse possession of the area which it used as a school site. Under Art. 1108 of the Civil Code, however,
prescription, both acquisitive and extinctive, does not run against the State
and its subdivisions.

To enable it to obtain legal authority on its continued use of
the two-hectare land as a school site, the Municipality of Mati should take the
necessary steps outlined by law. Under
Sec. 69 of the Public Land Act, the President of the Philippines may execute
contracts in favor of any province, municipality or branch or subdivision of
the government needing any portion of the land of the public domain open to
concession for educational, charitable or other similar purposes in the form of
donation, sale, lease, exchange or any other form.^[40]
Hence, the municipal government of Mati would do well to take the necessary
appropriate action towards legally retaining the two-hectare area as a school
site.

WHEREFORE, the decision of the Court of Appeals is
AFFIRMED subject to the modification that the adjudication of the two-hectare
land in favor of the Municipality of Mati be nullified. Instead, said municipality should be directed
to take the necessary steps to attain legal title over the said area for
educational purposes. No costs.

SO ORDERED.

Bidin, Davide, Jr., and
Melo, JJ., concur.

Gutierrez, Jr., J., (Chairman),
on official leave.

^[1]
The Solicitor General for the petitioner; Atty. Victor A. Clapano for respondents
Neri, et al., and Atty. Jose P. Arro for respondent Guillermina C. Vda. de
Mitre.

^[2]
Penned by Justice Rodolfo A. Nocon and concurred in by Associate Justices
Crisolito Pascual and Juan A. Sison.

^[3]
Presided by Judge Domingo Zuño, Sr.

^[4]
Exh. “26,” Mitre.

^[5]
Annex C to Petition; Rollo, p. 79.

^[6]
B.L. Claim No. 82(N), B.L.Claim No. 83 (N), B.L. Claim No. 84 (N), B.L. Claim
No. 201 and B.L. Claim No. 206(N) labelled as Exhs. 12 to 16-Lamorena.

^[7]
Rollo, p. 83.

^[8]
Exh. 17-Lamorena.

^[9]
Annex E to Petition; Rollo, p. 85.

^[10]
Exh. 11-Lamorena.

^[11]
Annex M to Petition; Rollo, p.
102.

^[12]
Civil Case No. 41071.

^[13]
CA-G.R. No. 38615-R.

^[14]
Penned by Justice Hermogenes Concepcion and concurred in by Justices Andres
Reyes and Luis B. Reyes.

^[15]
Record on Appeal, p. 4.

^[16]
Ibid., p. 12.

^[17]
Ibid., pp. 53-58.

^[18]
Ibid., p. 59.

^[19]
45 Phil. 848 [1924].

^[20]
Record on Appeal, p.73.

^[21]
Ibid., p. 84.

^[22]
Ibid., p. 87.

^[23]
Ibid., p. 90.

^[24]
She died on August 25, 1963. Ibid.,
p. 100.

^[25]
Ibid., p. 91.

^[26]
Ibid., p. 101.

^[27]
The decision, which was penned by
Justice Jose P. Bengzon and concurred in by Justices Salvador V. Esguerra and
Antonio G. Lucero, expressed the “possibility” that Lamorena’s
manifestation that the land in question is public land and upon which
the 1940 decision was based, was “a legal strategy to dislodge the
petitioners (Justo Charmen, Rufo Neri, Adriano Arche, Agapito Gurnot and
Paterno Madanlo) as possessors and/or owners of the land in question.” The
appellate court ruled that since the cadastral court dismissed the claims over
the land without adjudicating any title
or issuing any decree, the writ of possession was without any legal
basis and the petitioners as possessors could not simply be ousted by the writ
without due process of law. (Record on
Appeal, p. 135)

^[28]
Record on Appeal, pp. 156-157.

^[29]
Ibid., on Appeal, p. 157. Justice Jose S. Rodriguez, ponente, and Justices Antonio G. Lucero and
Nicasio A. Yatco, concurring.

^[30]
Record on Appeal, p. 234.

^[31]
This was established in the lower court through Lamorena’s tenant Jose Astrande
(Rollo, pp. 66-69).

^[32]
G.R. No. 79538, October 18, 1990, 190
SCRA 673, 680.

^[33]
Rollo, p. 36.

^[34]
Alvarez, Jr. v. Court of Appeals, G.R. No 60443, February 29, 1988, 158
SCRA 401.

^[35]
Republic v. Alagad, G.R. No. 66807, January 26, 1989, 169 SCRA 455.

^[36]
The requisites of res judicata are the
following: (a) the presence of a final
former judgment; (b) the former Judgment was rendered by a court having
jurisdiction over the subject matter and the parties; (c) the former judgment is
a judgment on the merits; and (d) there is between the first and the second
actions, identity of parties, of subject matter, and of cause of action (Heirs
of the late Santiago Maningo v. Intermediate Appellate Court, G.R. Nos.
73559-62, March 26, 1990, 183 SCRA 691).

^[37]
Vda. de Arceo v. Court of
Appeals, G.R. No. 81401, May 18, 1990, 185 SCRA 489.

^[38]
CFI Decision, p. 28; Rollo, p. 78.

^[39]
Beaterio del Santisimo Rosario de Molo v. Court of Appeals, L-44204,
July 11, 1985, 137 SCRA 459.

^[40]
City of lligan v. Director of Lands, L-30852, February 26, 1988, 158 SCRA 158.