JOSE S. OCAMPO, petitioner, vs. RICARDO S. OCAMPO SR., respondent
G.R. No. 227894 | July 5, 2017
FACTS:
Petitioners and respondent are brothers, both sons of the Basilio Ocampo and Juliana Sunglao
In the complaint, respondent alleged that her and petitioner are co-owners of the 150 sq. m. lot left behind by their parents. The subject property was originally registered in their parents’ names.
Respondent claims that petitioner and his wife conspired in falsifying his signature on a notarized Extra-Judicial Settlement with Waiver and effecting the transfer of the property in the name of petitioner under TCT No. 102822, which was issued on November 24, 1970. Based on a finding by the NBI that respondent’s signature was forged, an Information was filed against petitioner, the notary public, and two others. Respondent requested for partition of the property, but petitioner refused to do so and secretly mortgaged the property for P200,000.00.
In their Answer, petitioner and his wife claimed that their parents executed a Deed of Donation Propter Nuptias of the Subject Property in their favor as they were getting married, with a promise on their part to demolish the old house and replace it with a new two-storey house,
which they did. To build the new house, they obtained a P10,000 loan from the DBP, with petitioner and his parents as borrowers
Petitioner further alleged that his parents gave respondent several properties outside Metro Manila, which respondent eventually lost. Petitioner and his wife then allowed respondent to stay at the second floor of the house. Petitioner was able to pay the DBP loan through a loan secured from the SSS with the consent of his father. He claimed that on September 30, 1970, their father executed the ESW and secured respondent’s signature. By virtue of the ESW, petitioner was able to have TCT No. 36869 cancelled and have TCT No. 102822 issued in favor of himself and his wife.
Finally, petitioner argued that TCT No. 102822 became indefeasible one year after its issuance on November 24, 1971, and that the action to annul TCT No. 102822 had prescribed since it was filed only on June 29, 1992, or 21 years and 7 months from the issuance of the title. He further claimed that the action to annul the ESW is a collateral attack on the title, and the rule on nonprescription against a co-owner does not apply since he and his wife had become exclusive owners of the Subject Property.
The trial court dismissed the complaint on the ground of prescription. However, the CA declared the RTC’s decision null and void.
Thereafter, respondent filed a motion for writ of execution before the RTC. However, the motion was denied on the ground that there is nothing to execute since the setting aside of the RTC Order calls for the case to be tried on the merits. Thus, the RTC set the case for
Pretrial.
Meanwhile, petitioner filed a Motion for Leave to File Amended Answer which was granted by the RTC. In the Amended Answer, petitioner alleged that after their mother passed away in 1965, the P3,000.00 balance of the DBP loan was paid through an SSS loan. Petitioner alleged that in consideration of the loan, respondent and their father waived their rights to the property under the ESW. Petitioner further claimed that on November 19, 1970, their father executed a Deed of Absolute Sale, where he sold his interest in the Subject Property for P9,000.00 in favor of petitioner.
The RTC ruled in favor of the respondent. The CA affirmed the RTC’s decision.
In dismissing the petition, the CA found that respondent was able to prove that his signature on the ESW is not genuine, based on his and his wife’s testimony, as well as the NBI report. According to the CA, this finding of forgery was also supported by petitioner’s own admission on cross-examination that he was not present when the ESW was executed. Based on the evidence presented, the preponderance of evidence weighed in favor of respondent and against petitioner.
As to petitioner’s argument that the action is a collateral and not a direct attack on the title, the CA found it unmeritorious and ruled that the action precisely assails the validity of petitioner’s title on the ground that it is based on a forged document, and it is also an action for reconveyance. Thus, the CA ruled that the action to annul the ESW is imprescriptible since it is a void or inexistent contract.
Petitioner argues that the CA committed a reversible error in dismissing the appeal and in affirming the RTC Decision. Petitioner claims that the ESW, being a notarized document, enjoys a prima facie presumption of authenticity and due execution. He claims that there was no clear and convincing evidence to overcome this presumption.
Even assuming that the ESW is void or inexistent, petitioner argues that the action filed by respondent is barred by the doctrine of estoppel by laches. The ESW was executed and notarized on September 30, 1970. However, it was only on July 1, 1992 that respondent filed the present case for partition and annulment of title, claiming that the ESW was forged. Thus, petitioner argues that there was an unreasonable delay on respondent’s part to assert his rights and pursue his claims against petitioner.
ISSUE:
Whether or not the action for annulment of title and partition has already prescribed
RULING:
Under the Torrens System, the decree of registration and the certificate of title issued become incontrovertible upon the expiration of 1 year from the date of entry of the decree of registration, without prejudice to an action for damages against the applicant or any person responsible for the fraud. However, actions for reconveyance based on implied trusts may be allowed beyond the one-year period.
As elucidated in Walstrom v. Maps Jr., the irrevocability of the Torrens title already issued in the name of another person, he can still be compelled under the law to reconvey the subject property to the rightful owner. The property registered is deemed to be held in trust for the real owner by the person in whose name it is registered. In an action for reconveyance, the decree of registration is respected as incontrovertible. What is sought instead is the transfer of the property, which has been wrongfully or erroneously registered in another person’s name, to its rightful and legal owner, or to one with a better right. Yet, the right to seek reconveyance based on an implied or constructive trust is not absolute nor is it imprescriptible. An action for reconveyance based on an implied or constructive trust must perforce prescribe in 10 years from the issuance of the Torrens title over the property.
By way of additional exception, the Court has permitted the filing of an action for reconveyance despite the lapse of more than 10 years from the issuance of title where the plaintiffs therein were in actual possession of the disputed land, converting the action from reconveyance of property into one for quieting of title. Imprescriptibility is accorded to cases for quieting of title since the plaintiff has the right to wait until his possession is disturbed or his title is questioned before initiating an action to vindicate his right.
Given the falsity of the ESW, it becomes apparent that petitioner obtained the registration through fraud. This wrongful registration gives occasion to the creation of an implied or constructive trust under Article 1456 of the New Civil Code. An action for reconveyance based on an implied trust generally prescribes in ten years. However, if the plaintiff remains in possession of the property, the prescriptive period to recover title of possession does not run against him. In such case, his action is deemed in the nature of a quieting of title, an action that is imprescriptible.
In this case, the complaint for partition and annulment of the title was only more than twenty (20) years since the assailed title was issued. However, both petitioner and respondent were residing at the subject property at the time the complaint was filed. Considering that respondent was in actual possession of the disputed land at the time of the filing of the complaint, the present case may be treated as an action for quieting of title.
Quieting of title is a common law remedy for the removal of any cloud, doubt, or uncertainty affecting title to real property.
Originating in equity jurisprudence, its purpose is to secure an adjudication that a claim of title to or an interest in property, adverse to that of the complainant, is invalid, so that the complainant and those claiming under him may be forever afterward free from any danger of hostile claim. In an action for quieting of title, the court is tasked to determine the respective rights of the complainant and other claimants, not only to place things in their proper place, to make the one who has no rights to said immovable respect and not disturb the other, but also for the benefit of both, so that he who has the right would see every cloud of doubt over the property dissipated, and he could afterwards without fear introduce the improvements he may desire, to use, and even to abuse the property as he deems best.
For an action to quiet title to prosper, two indispensable requisites must concur, namely: (1) the plaintiff or complainant has a legal or an equitable title to or interest in the real property subject of the action; and (2) the deed, claim, encumbrance or proceeding claimed to be casting cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal efficacy.
A cloud on a title exists when (1) there is an instrument (deed, or contract) or record or claim or encumbrance or proceeding; (2) which is apparently valid or effective; (3) but is, in truth and in fact, invalid, ineffective, voidable, or unenforceable or extinguished or barred by extinctive prescription; and (4) may be prejudicial to the title.
Since it was already established that respondent’s signature on the ESW, which was the basis of petitioner’s title over the property, was forged, then it is only necessary for the cloud on respondent’s title to be removed. Thus, the trial court’s order to cancel TCT No. 102822 and uphold the parties’ co-ownership was proper.
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