Indefeasibility of Title, Prescription, Prohibition against Collateral Attack

Caraan v. CA, G.R. No. 140752

Caraan v. CA, G.R. No. 140752. Nov. 11, 2005

FACTS:

private respondents are the registered owners of the real property loc in Q.C. they discovered that the land
was being occupied by petitioner who had built his residential house and such occupancy by petitioner was
effected through fraud, strategy and stealth without private respondent’s knowledge and consent. Demands
to vacate, both oral and written, were made upon petitioner but to no avail. Respondents filed for accion
reivendicaturia against the petitioners before the RTC. Petitioner contends he had acquired the land in
question through extra-ordinary prescription of thirty years of continuous, public, open and uninterrupted
possession and that he has a better right since respondent’s TCT was derived from a OCT that was
declared null and void by the RTC.

ISSUE:

WON respondents contention is correct.

HELD:

a certificate of title serves as evidence of an indefeasible title to the property in favor of the person whose
name appears therein. Private respondents having presented TCT, they have thus proven their allegation
of ownership over the subject property. Section 48, Presidential Decree No. 1529 (P.D. No. 1529), provides
that the certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or cancelled
except in a direct proceeding in accordance with law. The Court defined a collateral attack on the title in
this.

When is an action an attack on a title? It is when the object of the action or proceeding is to nullify the title,
and thus challenge the judgment pursuant to which the title was decreed. The attack is direct when the
object of an action or proceeding is to annul or set aside such judgment, or enjoin its enforcement.

On the other hand, the attack is indirect or collateral when, in an action to obtain a different relief, an attack
on the judgment is nevertheless made as an incident thereof. In an action for recovery of possession, the
defense of the possessor that the plaintiff’s certificate of title is void is a collateral attack which is prohibited
under PD 1529. the defense of prescription of Caraan cannot stand against the Certificate of Title of Cosme
because under section 47, PD 1529, no title to registered land in derogation of the title of the registered
owner shall be acquired by prescription or adverse possession.

Sec. 5. Any transfer or conveyance of a unit or an apartment, office or store or other space therein, shall
include the transfer or conveyance of the undivided interests in the common areas or, in a proper case, the
membership or shareholdings in the condominium corporation: Provided, however, That where the
common areas in the condominium project are owned by the owners of separate units as co-owners thereof,
no condominium unit therein shall be conveyed or transferred to persons other than Filipino citizens, or
corporations at least sixty percent of the capital stock of which belong to Filipino citizens, except in cases
of hereditary succession. Where the common areas in a condominium project are held by a corporation, no
transfer or conveyance of a unit shall be valid if the concomitant transfer of the appurtenant membership or
stockholding in the corporation will cause the alien interest in such corporation to exceed the limits imposed
by existing laws.
 Republic of the Philippines
SUPREME COURT

SECOND DIVISION

G.R. No. 140752 November 11, 2005

DIONISIO CARAAN, represented by HEIDI CARAAN and ERLINDA

CARAAN*, Petitioners,
vs.
COURT OF APPEALS and SPOUSES SALCEDO R. COSME and NORA LINDA S.
COSME**, Respondents.

DECISION

AUSTRIA-MARTINEZ, J.:

This resolves the petition for review on certiorari seeking to set aside the Decision1 of the
Court of Appeals (CA) dated October 29, 1999 affirming with modification the Decision of
the Regional Trial Court of Quezon City, Branch 104 (RTC), thereby ordering herein
petitioners to vacate the property located at No. 65 Commodore St., Veterans
Subdivision, Barangay Holy Spirit, Quezon City and surrender possession thereof to
herein private respondents.

The antecedent facts are as follows.

On September 16, 1992, private respondents-spouses Salcedo R. Cosme and Nora

Linda S. Cosme filed a complaint (accion reivindicatoria) with damages against Dionisio
Caraan in the RTC. Therein, it was alleged that: herein private respondents are the
registered owners of the real property located at No. 65 Commodore St., Veterans
Subdivision, Barangay Holy Spirit, Quezon City under Transfer Certificate of Title (TCT)
No. 214949; they had been paying realty taxes on the property from 1969 to 1993;
sometime in March 1991, they discovered that the land was being occupied by petitioner
who had built his residential house thereon; such occupancy by petitioner was effected
through fraud, strategy and stealth without private respondents’ knowledge and consent;
demands to vacate, both oral and written, were made upon petitioner, the last written
demand having been received by petitioner on August 7, 1992, but said demands went
unheeded; thus, private respondents prayed that judgment be rendered ordering
petitioner and all persons holding title under him to vacate the subject premises and
deliver possession thereof to private respondents; pay private respondents the amount
of P54,000.00 by way of reasonable compensation for the use and occupancy of the
premises, P50,000.00 as moral damages, and P50,000.00 as attorney’s fees.

In his Answer with Counterclaim, petitioner alleged that he had acquired the land in
question through extra-ordinary prescription of thirty years of continuous, public, open
and uninterrupted possession; private respondents’ title was one of the numerous titles
derived from TCT No. 3548 in the name of Eustacio Morales and Vicente Villar doing
business under the style of Vilma Malolos Subdivision, which was in turn derived from
TCT No. 33531 which came from TCT No. 26285 and derived from (OCT) No. 614; and
OCT No. 614 had been declared null and void by the RTC, Quezon City (Branch 83). 2

After trial on the merits, the RTC rendered its Decision dated August 9, 1995, the
dispositive portion of which reads as follows:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the

plaintiffs [herein private respondents], whereby defendant [herein petitioner] is ordered
to:

(a) Vacate the premises concerned and to deliver and surrender the possession of the
same to the plaintiff;

(b) To pay plaintiffs the sum of P54,000.00 as reasonable compensation for the use and
occupancy of the premises subject matter of the above-entitled case;

(c) Pay the plaintiffs the sum P30,000.00 as moral damages;

(d) Pay the plaintiffs the sum of P20,000.00 as attorney’s fees and to pay the cost of the
suit.3

Herein petitioner Dionisio Caraan then appealed the RTC judgment to the CA. On
October 29, 1999, the CA promulgated its Decision ruling thus:

… Absent any countervailing factum probandum adduced by the defendant-appellant

[herein petitioner], the indefeasibility of the Torrens title under their [herein private
respondents’] names buttresses the presumption ad homini that they have a better right
of ownership over the land. …

The defendant-appellant [herein petitioner] cannot seek refuge on his contention that he
is a holder of a residential permit allegedly issued by the Bureau of Forest Development.
Within the aegis of Section 3 (ff) of Presidential Decree No. 705, otherwise known as the
Revised Forestry Code, a "[p]ermit is a short-term privilege or authority granted by the
State to a person to utilize any limited forest resources or undertake a limited activity
within any forest land without any right to occupation and possession therein." …

Neither is the defendant-appellant a possessor in the concept of an owner, which fact is

a conditio sine qua non in order to be entitled to ownership through acquisitive
prescription.

… mere possession with a juridical title, e.g., as a usufructuary, a trustee, a lessee, an

agent or a pledgee, not being in the concept of owner, cannot ripen into ownership by
acquisitive prescription, unless the juridical relation is first expressly repudiated and such
repudiation has been communicated to the other party.4 …
The appellate court then affirmed the RTC judgment ordering petitioner Dionisio Caraan
to vacate subject premises and to deliver and surrender possession thereof to herein
private respondents. The CA, however, deleted the sums for compensatory and moral
damages and attorney’s fees awarded by the RTC in favor of private respondents. No
motion for reconsideration of the CA Decision was filed.

In the meantime, petitioner Dionisio Caraan died and his surviving heirs filed with this
Court a petition for review on certiorari with motion that said heirs be substituted as
petitioners in this case.

Petitioners insist that private respondents’ TCT No. 214949 is a derivative of OCT No.
614 and TCT No. 3548 which had been declared spurious and null and void; Dionisio
Caraan has a better right of possession because he had been in open, public, adverse,
continuous, and uninterrupted possession in the concept of owner of subject land for more
than thirty years; and the subject land is part of a large tract of public land not yet classified
for alienation to private ownership.

On the other hand, private respondents argue that a certificate of title cannot be
collaterally attacked, thus, TCT No. 214949 is valid and existing and conclusive evidence
of ownership unless it becomes subject of a direct attack through a proceeding for
cancellation of title.

The Court finds the present petition bereft of merit.

In Eduarte vs. Court of Appeals,5 the Court reiterated the hornbook principle that "a
certificate of title serves as evidence of an indefeasible title to the property in favor of the
person whose name appears therein."6 Private respondents having presented TCT No.
RT-71061, which is the reconstituted title of TCT No. 214949, they have thus proven their
allegation of ownership over the subject property. The burden of proof then shifted to
petitioners who must establish by preponderance of evidence their allegation that they
have a better right over the subject property.

Petitioners attack the validity of private respondents’ certificate of title, alleging that TCT
No. 214949 is spurious as it was derived from OCT No. 614 which had allegedly been
declared null and void pursuant to the

Partial Decision on Defaulted Private Respondents dated March 21, 1988 issued in Civil
Case No. Q-35672, entitled Teofilo M. Gariando, et al. vs. Gregorio Dizon, et al.
Petitioners further point out that the subject land could not have been titled in favor of
private respondents as said land is within the unclassified public forest land of Quezon
City and not subject to disposition under the Public Land Law, per Certification dated April
16, 1985 issued by the Bureau of Forest Development. Petitioners further argue that they
have a better right to subject property, as they had been in possession thereof in open,
public, adverse, continuous, and uninterrupted possession in the concept of owner of
subject land for more than thirty years.

It should be borne in mind, however, that Section 48, Presidential Decree No. 1529 (P.D.
No. 1529), provides that "a certificate of title shall not be subject to collateral attack. It
cannot be altered, modified, or cancelled except in a direct proceeding in accordance with
law."

Petitioners’ defense takes the form of a collateral attack on private respondents’ certificate
of title. In Mallilin, Jr. vs. Castillo,7 the Court defined a collateral attack on the title in this
wise:

… When is an action an attack on a title? It is when the object of the action or proceeding
is to nullify the title, and thus challenge the judgment pursuant to which the title was
decreed. The attack is direct when the object of an action or proceeding is to annul or set
aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect
or collateral when, in an action to obtain a different relief, an attack on the judgment is
nevertheless made as an incident thereof.8

In the present case, the attack on the title is definitely merely collateral as the relief being
sought by private respondents in their action was recovery of possession. The attack on
the validity of private respondents’ certificate of title was merely raised as a defense in
petitioners’ Answer filed with the trial court. In Ybañez vs. Intermediate Appellate
Court,9 the Court categorically ruled that:

It was erroneous for petitioners to question the Torrens Original Certificate of Title issued
to private respondent over Lot No. 986 in Civil Case No. 671, an ordinary civil action for
recovery of possession filed by the registered owner of the said lot, by invoking as
affirmative defense in their answer the Order of the Bureau of Lands, dated July 19, 1978,
issued pursuant to the investigatory power of the Director of Lands under Section 91 of
Public Land Law (C.A. 141 as amended). Such a defense partakes of the nature of a
collateral attack against a certificate of title brought under the operation of the
Torrens system of registration pursuant to Section 122 of the Land Registration
Act, now Section 103 of P.D. 1259. The case law on the matter does not allow collateral
attack on the Torrens certificate of title on the ground of actual fraud. The rule now finds
expression in section 48 of P.D. 1529 otherwise known as the Property Registration
Decree.10 (Emphasis supplied)

The Court cannot, therefore, resolve the issue of the alleged invalidity of private
respondents’ certificate of title in the present action for recovery of possession. Even
petitioners’ claim that subject property could not have been titled in favor of private
respondents because the same has not yet been classified for alienation for private
ownership, cannot be given consideration because, as clearly stated in Apostol vs. Court
of Appeals, "[t]he issue of the validity of the title of respondents can only be assailed in
an action expressly instituted for that purpose."11

Petitioners’ asseveration that TCT No. RT-71061 (214949) should not have been
admitted into evidence because private respondents merely presented the photocopy
thereof is also unmeritorious. Private respondents presented the original of TCT No. RT-
71061 (214949) in open court during the hearing held on April 13, 1994. The pertinent
portions of the transcript of stenographic notes of said hearing are reproduced hereunder:
Atty. Mazo:

Your Honor, we are presenting in evidence this Transfer Certificate of Title No. RT-71061
(214949) as Exhibit A. The purpose of which, Your Honor, is to show that the property
subject matter of this case is registered in the name of the herein plaintiff spouses Salcedo
R. Cosme and Nora Linda S. Cosme. And in that regard, Your Honor, may we invite
Counsel to stipulate that this is a Xerox copy and that we request to be marked as
Exhibit A is a faithful reproduction of the original.

If Counsel will stipulate, this will be the one to be submitted in evidence.

Atty. Moya:

This is a faithful reproduction, Your Honor. (Emphasis supplied)

Furthermore, no objection was raised by counsel for petitioners in their written

opposition/comment to private respondents’ offer of evidence12regarding the fact that
what was marked and submitted to the court was the photocopy. In Blas vs. Angeles-
Hutalla,13 the Court held thus:

The established doctrine is that when a party failed to interpose a timely objection to
evidence at the time they were offered in evidence, such objection shall be considered
as waived. In Tison v. Court of Appeals, the Supreme Court set out the applicable
principle in the following terms:

[F]or while the documentary evidence submitted by petitioners do not strictly conform to
the rules on their admissibility, we are, however, of the considered opinion that the same
may be admitted by reason of private respondent’s failure to interpose any timely
objection thereto at the time they were being offered in evidence. It is elementary that an
objection shall be made at the time when an alleged inadmissible document is offered in
evidence, otherwise, the objection shall be treated as waived, since the right to object is
merely a privilege which the party may waive.

As explained in Abrenica vs. Gonda, et al., it has been repeatedly laid down as a rule of
evidence that a protest or objection against the admission of any evidence must be made
at the proper time, otherwise, it will be deemed to have been waived. The proper time is
when from the question addressed to the witness, or from the answer thereto, or from the
presentation of the proof, the inadmissibility of the evidence is, or may be inferred.

Thus, a failure to except to the evidence because it does not conform with the statute is
a waiver of the provisions of the law.14 …

Hence, considering the fact that counsel for petitioners admitted that the photocopy of
TCT No. RT-71061 (214949) is a faithful reproduction of the original thereof, stipulated
with private respondents’ counsel that what will be marked and submitted to the trial court
as Exhibit A is the photocopy, and the lack of objection on such ground which is then
deemed a waiver thereof, the admission into evidence of the photocopy of TCT No. RT-
71061 was absolutely correct.
Moreover, although the reconstituted title of TCT No. 214949 does show on its face that
it was derived from OCT No. 614,15 both the trial and appellate courts are correct in saying
that petitioners’ assertion that OCT No. 614 had been declared null and void is
misleading. The RTC of Quezon City, Branch 83 issued a Partial Decision on Defaulted
Private Respondents16 dated March 21, 1988 in Civil Case No. Q-35672 which declared
OCT No. 614 and subsequent TCTs issued therefrom, "with the exception of those titles
belonging to the non-defaulted respondents,"17null and void. However, the defaulted
private respondents in Civil Case No. Q-35672 filed a case for annulment of said partial
judgment. The CA granted the petition for annulment of partial judgment in Civil Case No.
Q-35672. The case was elevated via a petition for review on certiorariassailing the CA
decision and on January 19, 2001, this Court promulgated a Decision in Pinlac vs. Court
of Appeals,18 docketed as G.R. No. 91486, affirming the CA Decision setting aside and
annulling said partial decision on the ground of the trial court’s lack of jurisdiction over the
persons of respondents in said case. Petitioners have not been able to present any proof
that, indeed, OCT No. 614 had been declared null and void by final judgment. Hence,
petitioners’ claim that private respondents’ certificate of title is spurious deserves no
consideration whatsoever. Private respondents’ certificate of title must be deemed valid
and existing, as it cannot be assailed through a collateral attack in the present action.

Consequently, petitioners’ defense that they have a better right over the subject land
because they had been in open, public, adverse, continuous, and uninterrupted
possession in the concept of owner for more than 30 years must be struck down. Section
47 of P.D. No. 1529 provides that "[n]o title to registered land in derogation of the title of
the registered owner shall be acquired by prescription or adverse possession." The ruling
in Ragudo vs. Fabella Estate Tenants Association, Inc.,19 is exactly in point, to wit:

… In a long line of cases, we have consistently ruled that lands covered by a title cannot
be acquired by prescription or adverse possession. So it is that in Natalia Realty
Corporation vs. Vallez, et al., we held that a claim of acquisitive prescription is baseless
when the land involved is a registered land because of Article 1126 of the Civil Code in
relation to Act 496 (now, Section 47 of Presidential Decree No. 1529):

Appellants’ claim of acquisitive prescription is likewise baseless. Under Article 1126 of

the Civil Code, prescription of ownership of lands registered under the Land
Registration Act shall be governed by special laws. Correlatively, Act No. 496
provides that no title to registered land in derogation of that of the registered owner
shall be acquired by adverse possession. Consequently, proof of possession by the
defendants is both immaterial and inconsequential. (Emphasis supplied)

Therefore, as emphasized in the above quoted ruling, petitioners’ allegations of

uninterrupted possession for 30 years cannot prevail over private respondents’ certificate
of title, which is the best proof of ownership. As the Court stated in Apostol vs. Court of
Appeals, et al.,20 the registered owners are entitled to the possession of the property
covered by the said title from the time such title was issued in their favor. Preponderance
of evidence being in favor of private respondents, there can be no other conclusion but
that private respondents, being the registered owners of subject property, should be
placed in possession thereof.
WHEREFORE, the petition is DENIED for lack of merit. The Decision of the Court of
Appeals dated October 29, 1999 is hereby AFFIRMED.

SO ORDERED.