G.R. No.

137705               August 22, 2000

SERG'S PRODUCTS, INC., and SERGIO T. GOQUIOLAY, petitioners,

vs.
PCI LEASING AND FINANCE, INC., respondent.

DECISION

PANGANIBAN, J.:

After agreeing to a contract stipulating that a real or immovable property be considered as personal or
movable, a party is estopped from subsequently claiming otherwise. Hence, such property is a proper
subject of a writ of replevin obtained by the other contracting party.

The Case

Before us is a Petition for Review on Certiorari assailing the January 6, 1999 Decision 1 of the Court of
Appeals (CA)2 in CA-GR SP No. 47332 and its February 26, 1999 Resolution 3 denying reconsideration. The
decretal portion of the CA Decision reads as follows:

"WHEREFORE, premises considered, the assailed Order dated February 18, 1998 and Resolution dated
March 31, 1998 in Civil Case No. Q-98-33500 are hereby AFFIRMED. The writ of preliminary injunction
issued on June 15, 1998 is hereby LIFTED."4

In its February 18, 1998 Order,5 the Regional Trial Court (RTC) of Quezon City (Branch 218) 6 issued a Writ
of Seizure.7 The March 18, 1998 Resolution8 denied petitioners’ Motion for Special Protective Order,
praying that the deputy sheriff be enjoined "from seizing immobilized or other real properties in
(petitioners’) factory in Cainta, Rizal and to return to their original place whatever immobilized
machineries or equipments he may have removed." 9

The Facts

The undisputed facts are summarized by the Court of Appeals as follows: 10

"On February 13, 1998, respondent PCI Leasing and Finance, Inc. ("PCI Leasing" for short) filed with the
RTC-QC a complaint for [a] sum of money (Annex ‘E’), with an application for a writ of replevin docketed
as Civil Case No. Q-98-33500.

"On March 6, 1998, upon an ex-parte application of PCI Leasing, respondent judge issued a writ of
replevin (Annex ‘B’) directing its sheriff to seize and deliver the machineries and equipment to PCI
Leasing after 5 days and upon the payment of the necessary expenses.

"On March 24, 1998, in implementation of said writ, the sheriff proceeded to petitioner’s factory, seized
one machinery with [the] word that he [would] return for the other machineries.

"On March 25, 1998, petitioners filed a motion for special protective order (Annex ‘C’), invoking the
power of the court to control the conduct of its officers and amend and control its processes, praying for
a directive for the sheriff to defer enforcement of the writ of replevin.

"This motion was opposed by PCI Leasing (Annex ‘F’), on the ground that the properties [were] still
personal and therefore still subject to seizure and a writ of replevin.
"In their Reply, petitioners asserted that the properties sought to be seized [were] immovable as defined
in Article 415 of the Civil Code, the parties’ agreement to the contrary notwithstanding. They argued
that to give effect to the agreement would be prejudicial to innocent third parties. They further stated
that PCI Leasing [was] estopped from treating these machineries as personal because the contracts in
which the alleged agreement [were] embodied [were] totally sham and farcical.

"On April 6, 1998, the sheriff again sought to enforce the writ of seizure and take possession of the
remaining properties. He was able to take two more, but was prevented by the workers from taking the
rest.

"On April 7, 1998, they went to [the CA] via an original action for certiorari."

Ruling of the Court of Appeals

Citing the Agreement of the parties, the appellate court held that the subject machines were personal
property, and that they had only been leased, not owned, by petitioners. It also ruled that the "words of
the contract are clear and leave no doubt upon the true intention of the contracting parties." Observing
that Petitioner Goquiolay was an experienced businessman who was "not unfamiliar with the ways of
the trade," it ruled that he "should have realized the import of the document he signed." The CA further
held:

"Furthermore, to accord merit to this petition would be to preempt the trial court in ruling upon the
case below, since the merits of the whole matter are laid down before us via a petition whose sole
purpose is to inquire upon the existence of a grave abuse of discretion on the part of the [RTC] in issuing
the assailed Order and Resolution. The issues raised herein are proper subjects of a full-blown trial,
necessitating presentation of evidence by both parties. The contract is being enforced by one, and [its]
validity is attacked by the other – a matter x x x which respondent court is in the best position to
determine."

Hence, this Petition.11

The Issues

In their Memorandum, petitioners submit the following issues for our consideration:

"A. Whether or not the machineries purchased and imported by SERG’S became real property by virtue
of immobilization.

B. Whether or not the contract between the parties is a loan or a lease. "12

In the main, the Court will resolve whether the said machines are personal, not immovable, property
which may be a proper subject of a writ of replevin. As a preliminary matter, the Court will also address
briefly the procedural points raised by respondent.

The Court’s Ruling

The Petition is not meritorious.

Preliminary Matter: Procedural Questions

Respondent contends that the Petition failed to indicate expressly whether it was being filed under Rule
45 or Rule 65 of the Rules of Court. It further alleges that the Petition erroneously impleaded Judge
Hilario Laqui as respondent.

There is no question that the present recourse is under Rule 45. This conclusion finds support in the very
title of the Petition, which is "Petition for Review on Certiorari." 13

While Judge Laqui should not have been impleaded as a respondent, 14 substantial justice requires that
such lapse by itself should not warrant the dismissal of the present Petition. In this light, the Court
deems it proper to remove, motu proprio, the name of Judge Laqui from the caption of the present case.

Main Issue: Nature of the Subject Machinery

Petitioners contend that the subject machines used in their factory were not proper subjects of the Writ
issued by the RTC, because they were in fact real property. Serious policy considerations, they argue,
militate against a contrary characterization.

Rule 60 of the Rules of Court provides that writs of replevin are issued for the recovery of personal
property only.15 Section 3 thereof reads:

"SEC. 3. Order. -- Upon the filing of such affidavit and approval of the bond, the court shall issue an
order and the corresponding writ of replevin describing the personal property alleged to be
wrongfully detained and requiring the sheriff forthwith to take such property into his custody."

On the other hand, Article 415 of the Civil Code enumerates immovable or real property as follows:

"ART. 415. The following are immovable property:

x x x           x x x          x x x

(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an
industry or works which may be carried on in a building or on a piece of land, and which tend directly
to meet the needs of the said industry or works;

x x x           x x x          x x x"

In the present case, the machines that were the subjects of the Writ of Seizure were placed by
petitioners in the factory built on their own land. Indisputably, they were essential and principal
elements of their chocolate-making industry. Hence, although each of them was movable or personal
property on its own, all of them have become "immobilized by destination because they are essential
and principal elements in the industry." 16 In that sense, petitioners are correct in arguing that the said
machines are real, not personal, property pursuant to Article 415 (5) of the Civil Code. 17

Be that as it may, we disagree with the submission of the petitioners that the said machines are not
proper subjects of the Writ of Seizure.

The Court has held that contracting parties may validly stipulate that a real property be considered as
personal.18 After agreeing to such stipulation, they are consequently estopped from claiming otherwise.
Under the principle of estoppel, a party to a contract is ordinarily precluded from denying the truth of
any material fact found therein.
Hence, in Tumalad v. Vicencio,19 the Court upheld the intention of the parties to treat a house as a
personal property because it had been made the subject of a chattel mortgage. The Court ruled:

"x x x. Although there is no specific statement referring to the subject house as personal property, yet by
ceding, selling or transferring a property by way of chattel mortgage defendants-appellants could only
have meant to convey the house as chattel, or at least, intended to treat the same as such, so that they
should not now be allowed to make an inconsistent stand by claiming otherwise."

Applying Tumalad, the Court in Makati Leasing and Finance Corp. v. Wearever Textile Mills 20 also held
that the machinery used in a factory and essential to the industry, as in the present case, was a proper
subject of a writ of replevin because it was treated as personal property in a contract. Pertinent portions
of the Court’s ruling are reproduced hereunder:

"x x x. If a house of strong materials, like what was involved in the above Tumalad case, may be
considered as personal property for purposes of executing a chattel mortgage thereon as long as the
parties to the contract so agree and no innocent third party will be prejudiced thereby, there is
absolutely no reason why a machinery, which is movable in its nature and becomes immobilized only by
destination or purpose, may not be likewise treated as such. This is really because one who has so
agreed is estopped from denying the existence of the chattel mortgage."

In the present case, the Lease Agreement clearly provides that the machines in question are to be
considered as personal property. Specifically, Section 12.1 of the Agreement reads as follows: 21

"12.1 The PROPERTY is, and shall at all times be and remain, personal property notwithstanding that
the PROPERTY or any part thereof may now be, or hereafter become, in any manner affixed or
attached to or embedded in, or permanently resting upon, real property or any building thereon, or
attached in any manner to what is permanent."

Clearly then, petitioners are estopped from denying the characterization of the subject machines as
personal property. Under the circumstances, they are proper subjects of the Writ of Seizure.

It should be stressed, however, that our holding -- that the machines should be deemed personal
property pursuant to the Lease Agreement – is good only insofar as the contracting parties are
concerned.22 Hence, while the parties are bound by the Agreement, third persons acting in good faith are
not affected by its stipulation characterizing the subject machinery as personal. 23 In any event, there is
no showing that any specific third party would be adversely affected.

Validity of the Lease Agreement

In their Memorandum, petitioners contend that the Agreement is a loan and not a lease. 24 Submitting
documents supposedly showing that they own the subject machines, petitioners also argue in their
Petition that the Agreement suffers from "intrinsic ambiguity which places in serious doubt the intention
of the parties and the validity of the lease agreement itself." 25 In their Reply to respondent’s Comment,
they further allege that the Agreement is invalid. 26

These arguments are unconvincing. The validity and the nature of the contract are the lis mota of the
civil action pending before the RTC. A resolution of these questions, therefore, is effectively a resolution
of the merits of the case. Hence, they should be threshed out in the trial, not in the proceedings
involving the issuance of the Writ of Seizure.
Indeed, in La Tondeña Distillers v. CA,27 the Court explained that the policy under Rule 60 was that
questions involving title to the subject property – questions which petitioners are now raising -- should
be determined in the trial. In that case, the Court noted that the remedy of defendants under Rule 60
was either to post a counter-bond or to question the sufficiency of the plaintiff’s bond. They were not
allowed, however, to invoke the title to the subject property. The Court ruled:

"In other words, the law does not allow the defendant to file a motion to dissolve or discharge the writ
of seizure (or delivery) on ground of insufficiency of the complaint or of the grounds relied upon
therefor, as in proceedings on preliminary attachment or injunction, and thereby put at issue the matter
of the title or right of possession over the specific chattel being replevied, the policy apparently being
that said matter should be ventilated and determined only at the trial on the merits." 28

Besides, these questions require a determination of facts and a presentation of evidence, both of which
have no place in a petition for certiorari in the CA under Rule 65 or in a petition for review in this Court
under Rule 45.29

Reliance on the Lease Agreement

It should be pointed out that the Court in this case may rely on the Lease Agreement, for nothing on
record shows that it has been nullified or annulled. In fact, petitioners assailed it first only in the RTC
proceedings, which had ironically been instituted by respondent. Accordingly, it must be presumed valid
and binding as the law between the parties.

Makati Leasing and Finance Corporation30 is also instructive on this point. In that case, the Deed of
Chattel Mortgage, which characterized the subject machinery as personal property, was also assailed
because respondent had allegedly been required "to sign a printed form of chattel mortgage which was
in a blank form at the time of signing." The Court rejected the argument and relied on the Deed, ruling
as follows:

"x x x. Moreover, even granting that the charge is true, such fact alone does not render a contract
void  ab initio, but can only be a ground for rendering said contract voidable, or annullable pursuant to
Article 1390 of the new Civil Code, by a proper action in court. There is nothing on record to show that
the mortgage has been annulled. Neither is it disclosed that steps were taken to nullify the same. x x x"

Alleged Injustice Committed on the Part of Petitioners

Petitioners contend that "if the Court allows these machineries to be seized, then its workers would be
out of work and thrown into the streets." 31 They also allege that the seizure would nullify all efforts to
rehabilitate the corporation.

Petitioners’ arguments do not preclude the implementation of the Writ.1âwphi1 As earlier discussed,
law and jurisprudence support its propriety. Verily, the above-mentioned consequences, if they come
true, should not be blamed on this Court, but on the petitioners for failing to avail themselves of the
remedy under Section 5 of Rule 60, which allows the filing of a counter-bond. The provision states:

"SEC. 5. Return of property. -- If the adverse party objects to the sufficiency of the applicant’s bond, or of
the surety or sureties thereon, he cannot immediately require the return of the property, but if he does
not so object, he may, at any time before the delivery of the property to the applicant, require the
return thereof, by filing with the court where the action is pending a bond executed to the applicant, in
double the value of the property as stated in the applicant’s affidavit for the delivery thereof to the
applicant, if such delivery be adjudged, and for the payment of such sum to him as may be recovered
against the adverse party, and by serving a copy bond on the applicant."

WHEREFORE, the Petition is DENIED and the assailed Decision of the Court of Appeals AFFIRMED. Costs
against petitioners.

SO ORDERED.

G.R. No. 156295 : September 23, 2003

MARCELO R. SORIANO, Petitioner, vs. SPOUSES RICARDO and ROSALINA GALIT, Respondents.

DECISION

YNARES-SANTIAGO, J.:

Petitioner was issued a writ of possession in Civil Case No. 6643 1 for Sum of Money by the Regional Trial
Court of Balanga, Bataan, Branch 1. The writ of possession was, however, nullified by the Court of
Appeals in CA-G.R. SP No. 658912 because it included a parcel of land which was not among those
explicitly enumerated in the Certificate of Sale issued by the Deputy Sheriff, but on which stand the
immovables covered by the said Certificate. Petitioner contends that the sale of these immovables
necessarily encompasses the land on which they stand.

Dissatisfied, petitioner filed the instant petition for review on certiorari.

Respondent Ricardo Galit contracted a loan from petitioner Marcelo Soriano, in the total sum of
P480,000.00, evidenced by four promissory notes in the amount of P120,000.00 each dated August 2,
1996;3 August 15, 1996;4 September 4, 19965 and September 14, 1996.6 This loan was secured by a real
estate mortgage over a parcel of land covered by Original Certificate of Title No. 569. 7 After he failed to
pay his obligation, Soriano filed a complaint for sum of money against him with the Regional Trial Court
of Balanga City, Branch 1, which was docketed as Civil Case No. 6643. 8

Respondents, the Spouses Ricardo and Rosalina Galit, failed to file their answer. Hence, upon motion of
Marcelo Soriano, the trial court declared the spouses in default and proceeded to receive evidence for
petitioner Soriano ex parte.

On July 7, 1997, the Regional Trial Court of Balanga City, Branch 1 rendered judgment 9 in favor of
petitioner Soriano, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendant ordering
the latter to pay:

1. the plaintiff the amount of P350,000.00 plus 12% interest to be computed from the dates of maturity
of the promissory notes until the same are fully paid;

2. the plaintiff P20,000.00, as attorneys fees; and

3. the costs of suit.

SO ORDERED.10cräläwvirtualibräry
The judgment became final and executory. Accordingly, the trial court issued a writ of execution in due
course, by virtue of which, Deputy Sheriff Renato E. Robles levied on the following real properties of the
Galit spouses:

1. A parcel of land covered by Original Certificate of Title No. T-569 (Homestead Patent No. 14692)
situated in the Bo. of Tapulac, Orani, Bataan. Bounded on the SW, along line 1-2 by Lot No. 3, Cad. 145;
containing an area of THIRTY FIVE THOUSAND SEVEN HUNDRED FIFTY NINE (35,759) SQUARE METERS,
more or less x x x;

2. STORE/HOUSE CONSTRUCTED on Lot No. 1103 made of strong materials G.I. roofing situated at
Centro I, Orani, Bataan, x x x containing an area of 30 sq. meters, more or less x x x (constructed on TCT
No. T40785);

3. BODEGA constructed on Lot 1103, made of strong materials, G.I. roofing, situated in Centro I, Orani,
Bataan, x x x with a floor area of 42.75 sq. m. more or less x x x. 11cräläwvirtualibräry

At the sale of the above-enumerated properties at public auction held on December 23, 1998, petitioner
was the highest and only bidder with a bid price of P483,000.00. Accordingly, on February 4, 1999,
Deputy Sheriff Robles issued a Certificate of Sale of Execution of Real Property, 12 which reads:

CERTIFICATE OF SALE ON EXECUTION OF REAL PROPERTY

TO ALL WHO MAY SEE THESE PRESENTS:

GREETINGS:

I HEREBY that (sic) by virtue of the writ of execution dated October 16, 1998, issued in the above-
entitled case by the HON. BENJAMIN T. VIANZON, ordering the Provincial Sheriff of Bataan or her
authorized Deputy Sheriff to cause to be made (sic) the sum of P350,000.00 plus 12% interest to be
computed from the date of maturity of the promissory notes until the same are fully paid; P20,000.00 as
attorneys fees plus legal expenses in the implementation of the writ of execution, the undersigned
Deputy Sheriff sold at public auction on December 23, 1998 the rights and interests of defendants Sps.
Ricardo and Rosalina Galit, to the plaintiff Marcelo Soriano, the highest and only bidder for the amount
of FOUR HNDRED EIGHTY THREE THOUSAND PESOS (P483,000.00, Philippine Currency), the following
real estate properties more particularly described as follows :

ORIGINAL CERTIFICATE OF TITLE NO. T-569

A parcel of land (Homestead Patent No. 14692) situated in the Bo. of Tapulac, Orani, Bataan, x x x.
Bounded on the SW., along line 1-2 by Lot No. 3, Cad. 145, containing an area of THIRTY FIVE THOUSAND
SEVEN HUNDRED FIFTY NINE (35,759) SQUARE METERS, more or less x x x

TAX DEC. NO. PROPERTY INDEX NO. 018-09-001-02

STOREHOUSE constructed on Lot 1103, made of strong materials G.I. roofing situated at Centro I, Orani,
Bataan x x x containing an area of 30 sq. meters, more or less x x (constructed on TCT No. 40785)

TAX DEC. NO. 86 PROPERTY INDEX No. 018-09-001-02

BODEGA constructed on Lot 1103, made of strong materials G.I. roofing situated in Centro I, Orani,
Bataan, x x x with a floor area of 42.75 sq. m. more or less x x x
IT IS FURTHER CERTIFIED, that the aforesaid highest and lone bidder, Marcelo Soriano, being the plaintiff
did not pay to the Provincial Sheriff of Bataan the amount of P483,000.00, the sale price of the above-
described property which amount was credited to partial/full satisfaction of the judgment embodied in
the writ of execution.

The period of redemption of the above described real properties together with all the improvements
thereon will expire One (1) year from and after the registration of this Certificate of Sale with the
Register of Deeds.

This Certificate of Sheriffs Sale is issued to the highest and lone bidder, Marcelo Soriano, under
guarantees prescribed by law.

Balanga, Bataan, February 4, 1999.

On April 23, 1999, petitioner caused the registration of the Certificate of Sale on Execution of Real
Property with the Registry of Deeds.

The said Certificate of Sale registered with the Register of Deeds includes at the dorsal portion thereof
the following entry, not found in the Certificate of Sale on file with Deputy Sheriff Renato E.
Robles:13cräläwvirtualibräry

ORIGINAL CERTIFICATE OF TITLE NO. T-40785

A parcel of land (Lot No. 1103 of the Cadastral Survey of Orani) , with the improvements thereon,
situated in the Municipality of Orani, Bounded on the NE; by Calle P. Gomez; on the E. by Lot No. 1104;
on the SE by Calle Washington; and on the W. by Lot 4102, containing an area of ONE HUNDRED THIRTY
NINE (139) SQUARE METERS, more or less. All points referred to are indicated on the plan; bearing true;
declination 0 deg. 40E., date of survey, February 191-March 1920.

On February 23, 2001, ten months from the time the Certificate of Sale on Execution was registered with
the Registry of Deeds, petitioner moved14 for the issuance of a writ of possession. He averred that the
one-year period of redemption had elapsed without the respondents having redeemed the properties
sold at public auction; thus, the sale of said properties had already become final. He also argued that
after the lapse of the redemption period, the titles to the properties should be considered, for all legal
intents and purposes, in his name and favor. 15cräläwvirtualibräry

On June 4, 2001, the Regional Trial Court of Balanga City, Branch 1 granted the motion for issuance of
writ of possession.16 Subsequently, on July 18, 2001, a writ of possession17 was issued in petitioners favor
which reads:

WRIT OF POSSESSION

Mr. Renato E. Robles

Deputy Sheriff

RTC, Br. 1, Balanga City

Greetings :
WHEREAS on February 3, 2001, the counsel for plaintiff filed Motion for the Issuance of Writ of
Possession;

WHEREAS on June 4, 2001, this court issued an order granting the issuance of the Writ of Possession;

WHEREFORE, you are hereby commanded to place the herein plaintiff Marcelo Soriano in possession of
the property involved in this case situated (sic) more particularly described as:

1. STORE HOUSE constructed on Lot No. 1103 situated at Centro 1, Orani, Bataan covered by TCT No.
40785;

2. BODEGA constructed on Lot No. 1103 with an area of 42.75 square meters under Tax Declaration No.
86 situated at Centro 1, Orani, Bataan;

3. Original Certificate of Title No. 40785 with an area of 134 square meters known as Lot No. 1103 of the
Cadastral Survey of Orani

against the mortgagor/former owners Sps. Ricardo and Rosalinda (sic) Galit, her (sic) heirs, successors,
assigns and all persons claiming rights and interests adverse to the petitioner and make a return of this
writ every thirty (30) days from receipt hereof together with all the proceedings thereon until the same
has been fully satisfied.

WITNESS THE HONORABLE BENJAMIN T. VIANZON, Presiding Judge, this 18 th day of July 2001, at Balanga
City.

(Sgd) GILBERT S. ARGONZA

OIC

Respondents filed a petition for certiorari with the Court of Appeals, which was docketed as CA-G.R. SP
No. 65891, assailing the inclusion of the parcel of land covered by Transfer Certificate of Title No. T-
40785 among the list of real properties in the writ of possession. 18 Respondents argued that said
property was not among those sold on execution by Deputy Sheriff Renato E. Robles as reflected in the
Certificate of Sale on Execution of Real Property.

In opposition, petitioner prayed for the dismissal of the petition because respondent spouses failed to
move for the reconsideration of the assailed order prior to the filing of the petition. Moreover, the
proper remedy against the assailed order of the trial court is an appeal, or a motion to quash the writ of
possession.

On May 13, 2002, the Court of Appeals rendered judgment as follows:

WHEREFORE, the instant petition is hereby GRANTED. Accordingly, the writ of possession issued by the
Regional Trial Court of Balanga City, Branch 1, on 18 July 2001 is declared NULL and VOID.

In the event that the questioned writ of possession has already been implemented, the Deputy Sheriff of
the Regional Trial Court of Balanga City, Branch 1, and private respondent Marcelo Soriano are hereby
ordered to cause the redelivery of Transfer Certificate of Title No. T-40785 to the petitioners.

SO ORDERED.19cräläwvirtualibräry
Aggrieved, petitioner now comes to this Court maintaining that

1.) THE SPECIAL CIVIL ACTION OF CERTIORARI UNDER RULE 65 IS NOT THE PLAIN, SPEEDY AND
ADEQUATE REMEDY OF THE RESPONDENTS IN ASSAILING THE WRIT OF POSSESSION ISSUED BY THE
LOWER COURT BUT THERE WERE STILL OTHER REMEDIES AVAILABLE TO THEM AND WHICH WERE NOT
RESORTED TO LIKE THE FILING OF A MOTION FOR RECONSIDERATION OR MOTION TO QUASH OR EVEN
APPEAL.

2.) THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN DECLARAING THE CERTIFICATE OF SALE ON
EXECUTION OF REAL PROPERTY AS NULL AND VOID AND SUBSEQUENTLY THE WRIT OF POSSESSION
BECAUSE THE SAME IS A PUBLIC DOCUMENT WHICH ENJOYS THE PRESUMPTION OF REGULARITY AND IT
CANNOT BE OVERCOME BY A MERE STRANGE FEELING THAT SOMETHING IS AMISS ON ITS SURFACE
SIMPLY BECAUSE THE TYPEWRITTEN WORDS ON THE FRONT PAGE AND AT THE DORSAL PORTION
THEREOF IS DIFFERENT OR THAT IT IS UNLIKELY FOR THE SHERIFF TO USE THE DORSAL PORTION OF THE
FIRST PAGE BECAUSE THE SECOND PAGE IS MERELY HALF FILLED AND THE NOTATION ON THE DORSAL
PORTION COULD STILL BE MADE AT THE SECOND PAGE.

On the first ground, petitioner contends that respondents were not without remedy before the trial
court. He points out that respondents could have filed a motion for reconsideration of the Order
dated June 4, 1999, but they did not do so. Respondents could also have filed an appeal but they,
likewise, did not do so. When the writ of possession was issued, respondents could have filed a motion
to quash the writ. Again they did not. Respondents cannot now avail of the special civil action for
certiorari as a substitute for these remedies. They should suffer the consequences for sleeping on their
rights.

We disagree.

Concededly, those who seek to avail of the procedural remedies provided by the rules must adhere to
the requirements thereof, failing which the right to do so is lost. It is, however, equally settled that the
Rules of Court seek to eliminate undue reliance on technical rules and to make litigation as inexpensive
as practicable and as convenient as can be done. 20 This is in accordance with the primary purpose of the
1997 Rules of Civil Procedure as provided in Rule 1, Section 6, which reads:

Section 6. Construction.  These rules shall be liberally construed in order to promote their objective of
securing a just, speedy and inexpensive determination of every action and
proceeding.21cräläwvirtualibräry

The rules of procedure are not to be applied in a very rigid, technical sense and are used only to help
secure substantial justice. If a technical and rigid enforcement of the rules is made, their aim would be
defeated.22 They should be liberally construed so that litigants can have ample opportunity to prove
their claims and thus prevent a denial of justice due to technicalities. 23 Thus, in China Banking
Corporation v. Members of the Board of Trustees of Home Development Mutual Fund,24  it was held:

while certiorari as a remedy may not be used as a substitute for an appeal, especially for a lost
appeal, this rule should not be strictly enforced if the petition is genuinely meritorious. 25]  It has been said
that where the rigid application of the rules would frustrate substantial justice, or bar the vindication
of a legitimate grievance, the courts are justified in exempting a particular case from the operation of
the rules.26 (Emphasis ours)
Indeed, well-known is the rule that departures from procedure may be forgiven where they do not
appear to have impaired the substantial rights of the parties. 27  Apropos in this regard is Cometa v.
CA,28  where we said that

There is no question that petitioners were remiss in attending with dispatch to the protection of their
interests as regards the subject lots, and for that reason the case in the lower court was dismissed on a
technicality and no definitive pronouncement on the inadequacy of the price paid for the levied
properties was ever made. In this regard, it bears stressing that procedural rules are not to be belittled
or dismissed simply because their non-observance may have resulted in prejudice to a partys substantive
rights as in this case. Like all rules, they are required to be followed except when only for the most
persuasive of reasons they may be relaxed to relieve a litigant of an injustice not commensurate with
the degree of his thoughtlessness in not complying with the procedure prescribed. 29  (emphasis and
italics supplied.)

In short, since rules of procedure are mere tools designed to facilitate the attainment of justice, their
strict and rigid application which would result in technicalities that tend to frustrate rather than
promote substantial justice must always be avoided. 30 Technicality should not be allowed to stand in the
way of equitably and completely resolving the rights and obligations of the parties. 31cräläwvirtualibräry

Eschewing, therefore, the procedural objections raised by petitioner, it behooves us to address the issue
of whether or not the questioned writ of possession is in fact a nullity considering that it includes real
property not expressly mentioned in the Certificate of Sale of Real Property.

Petitioner, in sum, dwells on the general proposition that since the certificate of sale is a public
document, it enjoys the presumption of regularity and all entries therein are presumed to be done in the
performance of regular functions.

The argument is not persuasive.

There are actually two  (2) copies  of the Certificate of Sale on Execution of Real Properties issued
on February 4, 1999 involved, namely: (a) copy which is on file with the deputy sheriff; and (b) copy
registered with the Registry of Deeds. The object of scrutiny, however, is not the copy of the Certificate
of Sale on Execution of Real Properties issued by the deputy sheriff on February 4, 1999, 32 but the copy
thereof subsequently registered by petitioner with the Registry of Deeds on April 23, 1999, 33 which
included an entry on the  dorsal portion  of the first page  thereof describing a parcel of land covered by
OCT No. T-40785 not  found in the Certificate of Sale of Real Properties on file with the sheriff.

True, public documents by themselves may be adequate to establish the presumption of their validity.
However, their probative weight must be evaluated not in isolation but in conjunction with other
evidence adduced by the parties in the controversy, much more so in this case where the contents  of a
copy thereof subsequently registered for documentation purposes is being contested. No reason has
been offered how and why the questioned entry was subsequently intercalated in the copy of the
certificate of sale subsequently registered with the Registry of Deeds. Absent any satisfactory
explanation as to why said entry was belatedly inserted, the surreptitiousness of its inclusion coupled
with the furtive manner of its intercalation casts serious doubt on the authenticity of petitioners copy of
the Certificate of Sale. Thus, it has been held that while a public document like a notarized deed of sale
is vested with the presumption of regularity, this is not a guarantee of the validity of its
contents.34cräläwvirtualibräry

It must be pointed out in this regard that the issuance of a Certificate of Sale is an end result of judicial
foreclosure where statutory requirements are strictly adhered to; where even the slightest deviations
therefrom will invalidate the proceeding 35 and the sale.36 Among these requirements is an explicit
enumeration and correct description of what properties are to be sold stated in the notice. The
stringence in the observance of these requirements is such that an incorrect title number together with
a correct technical description of the property to be sold and vice versa  is deemed a substantial and
fatal error which results in the invalidation of the sale. 37cräläwvirtualibräry

The certificate of sale is an accurate record of what properties were actually sold to satisfy the debt. The
strictness in the observance of accuracy and correctness in the description of the properties renders the
enumeration in the certificate exclusive. Thus, subsequently including properties which have not been
explicitly mentioned therein for registration purposes under suspicious circumstances smacks of fraud.
The explanation that the land on which the properties sold is necessarily included and, hence, was
belatedly typed on the dorsal portion of the copy of the certificate subsequently registered is at best a
lame excuse unworthy of belief.

The appellate court correctly observed that there was a marked difference in the appearance of the
typewritten words appearing on the first page of the copy of the Certificate of Sale registered with the
Registry of Deeds38 and those appearing at the dorsal portion thereof. Underscoring the irregularity of
the intercalation is the clearly devious attempt to let such an insertion pass unnoticed by typing the
same at the back of the first page instead of on the second page which was merely half-filled and could
accommodate the entry with room to spare.

The argument that the land on which the buildings levied upon in execution is necessarily included is,
likewise, tenuous.  Article 415 of the Civil Code provides:

ART. 415. The following are immovable property:

(1) Land, buildings, roads and constructions of all kinds adhered to the soil.

xxx

(3) Everything  attached to an immovable in a fixed manner, in such a way that it cannot be separated
therefrom without breaking them material or deterioration of the object;

(4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or on lands
by the owner of the immovable in such a manner that it reveals the intention to attach them
permanently to the tenements;

(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an
industry or works which may be carried on in a building or on a piece of land, and which tend directly
to meet the needs of the said industry or works;

(6) Animal houses, pigeon houses, beehives, fish ponds or breeding places of similar nature, in case
their owner has placed them or preserves them with the intention to have them permanently
attached to the land, and forming a permanent part of it; the animals in these places are also
included;

xxx

(9) Docks and structures which, though floating, are intended by their nature and object to remain at
a fixed place on a river, lake or coast;

xxx.

The foregoing provision of the Civil Code enumerates land and buildings separately.  This can only mean
that a building is, by itself, considered immovable.39 Thus, it has been held that

. . . while it is true that a mortgage of land necessarily includes, in the absence of stipulation of the
improvements thereon, buildings, still a building by itself may be mortgaged apart from the land on
which it has been built.  Such mortgage would be still a real estate mortgage for the building would still
be considered immovable property even if dealt with separately and apart from the land.40  (emphasis
and italics supplied)

In this case, considering that what was sold by virtue of the writ of execution issued by the trial court
was merely the storehouse and bodega  constructed on the parcel of land covered by Transfer
Certificate of Title No. T-40785, which by themselves are real properties of respondents spouses, the
same should be regarded as separate and distinct from the conveyance of the lot on which they stand.

WHEREFORE, in view of all the foregoing, the petition is hereby DENIED for lack of merit. The Decision
dated May 13, 2002 of the Court of Appeals in CA-G.R. SP No. 65891, which declared the writ of
possession issued by the Regional Trial Court of Balanga City, Branch 1, on July 18, 2001, null and void, is
AFFIRMED in toto.

SO ORDERED.

G.R. No. 180110

CAPITOL WIRELESS, INC., Petitioner,

vs.
THE PROVINCIAL TREASURER OF BATANGAS, THE PROVINCIAL ASSESSOR OF BATANGAS, THE
MUNICIPAL TREASURER AND ASSESSOR OF NASUGBU, BATANGAS, Respondents.

DECISION

PERALTA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to
annul and set aside the Court of Appeals’ Decision 1 dated May 30, 2007 and Resolution2 dated October
8, 2007 in CA-G.R. SP No. 82264, which both denied the appeal of petitioner against the decision of the
Regional Trial Court.

Below are the acts of the case.

Petitioner Capitol Wireless Inc. (Capwire) is a Philippine corporation in the business of providing
international telecommunications services. 3 As such provider, Capwire has signed agreements with
other local and foreign telecommunications companies covering an international network of

submarine cable systems such as the Asia Pacific Cable Network System (APCN) (which connects
Australia, Thailand, Malaysia, Singapore, Hong Kong, Taiwan, Korea, Japan, Indonesia and the
Philippines); the BruneiMalaysia-Philippines Cable Network System (BMP-CNS), the PhilippinesItaly

(SEA-ME-WE-3 CNS), and the Guam Philippines (GP-CNS) systems. 4 The agreements provide for co-
ownership and other rights among the parties over the network. 5

Petitioner Capwire claims that it is co-owner only of the so-called "Wet Segment" of the APCN, while the
landing stations or terminals and Segment E of APCN located in Nasugbu, Batangas are allegedly owned
by the Philippine Long Distance Telephone Corporation (PLDT). 6 Moreover, it alleges that the Wet
Segment is laid in international, and not Philippine, waters. 7

Capwire claims that as co-owner, it does not own any particular physical part of the cable system but,
consistent with its financial contributions, it owns the right to use a certain capacity of the said
systern. 8 This property right is allegedly reported in its financial books as "Indefeasible Rights in Cable
Systems."9

However, for loan restructuring purposes, Capwire claims that "it was required to register the value of
its right," hence, it engaged an appraiser to "assess the market value of the international submarine
cable system and the cost to Capwire." 10 On May 15, 2000, Capwire submitted a Sworn Statement of
True Value of Real Properties at the Provincial Treasurer's Office, Batangas City, Batangas Province, for
the Wet Segment of the system, stating:

System Sound Value

APCN P203,300,000.00

BMP-CNS p 65,662,000.00

SEA-ME-WE-3 CNSP P7,540,000.00

GP-CNS P1,789,000.00

Capwire claims that it also reported that the system "interconnects at the PLDT Landing Station in
Nasugbu, Batangas," which is covered by a transfer certificate of title and tax declarations in the name
of PLDT. 11

As a result, the respondent Provincial Assessor of Batangas (Provincial Assessor) issued the following
Assessments of Real Property (ARP) against Capwire:

ARP Cable System Assessed Value

019-00967 BMP-CNS P52,529,600.00

 019-00968 APCN P162,640,000.00

019-00969 SEA-ME-WE3-CNS P: 6,032,000.00

019-00970 GP-CNS P: 1,431,200.00

In essence, the Provincial Assessor had determined that the submarine cable systems described in
Capwire's Sworn Statement of True Value of Real Properties are taxable real property, a determination
that was contested by Capwire in an exchange of letters between the company and the public
respondent. 12 The reason cited by Capwire is that the cable system lies outside of Philippine territory,
i.e., on international waters. 13

On February 7, 2003 and March 4, 2003, Capwire received a Warrant of Levy and a Notice of Auction
Sale, respectively, from the respondent Provincial Treasurer of Batangas (Provincial Treasurer). 14

On March I 0, 2003, Capwire filed a Petition for Prohibition and Declaration of Nullity of Warrant of Levy,
Notice of Auction Sale and/or Auction Sale with the Regional Trial Court (RTC) of Batangas City.  15

After the filing of the public respondents' Comment, 16 on May 5, 2003, the RTC issued an Order
dismissing the petition for failure of the petitioner Capwire to follow the requisite of payment under
protest as well as failure to appeal to the Local Board of Assessment Appeals (LBAA), as provided for in
Sections 206 and 226 of Republic Act (R.A.) No. 7160, or the Local Government Code. 17

Capwire filed a Motion for Reconsideration, 18 but the same was likewise dismissed by the RTC in an
Order19 dated August 26, 2003. It then filed an appeal to the Court of Appeals. 20

On May 30, 2007, the Court of Appeals promulgated its Decision dismissing the appeal filed by Capwire
and affirming the order of the trial court.1âwphi1 The dispositive portion of the CA's decision states:

WHEREFORE, premises considered, the assailed Orders dated May 5, 2003 and August 26, 2003 of the
Regional Trial Court, Branch II of Batangas City, are AFFIRMED.

SO ORDERED.21

The appellate court held that the trial court correctly dismissed Capwire's petition because of the latter's
failure to comply with the requirements set in Sections 226 and 229 of the Local Government Code, that
is, by not availing of remedies before administrative bodies like the LBAA and the Central Board of
Assessment Appeals (CBAA). 22 Although Capwire claims that it saw no need to undergo administrative
proceedings because its petition raises purely legal questions, the appellate comi did not share this view
and noted that the case raises questions of fact, such as the extent to which parts of the submarine
cable system lie within the territorial jurisdiction of the taxing authorities, the public
respondents.23 Further, the CA noted that Capwire failed to pay the tax assessed against it under
protest, another strict requirement under Section 252 of the Local Government Code 24

Hence, the instant petition for review of Capwire.

Petitioner Capwire asserts that recourse to the Local Board of Assessment Appeals, or payment of the
tax under protest, is inapplicable to the case at bar since there is no question of fact involved, or that
the question involved is not the reasonableness of the amount assessed but, rather, the authority and
power of the assessor to impose the tax and of the treasurer to collect it. 25 It contends that there is only
a pure question of law since the issue is whether its submarine cable system, which it claims lies in
international waters, is taxable.26 Capwire holds the position that the cable system is not subject to tax. 27

Respondents assessors and treasurers of the Province of Batangas and Municipality of Nasugbu,
Batangas disagree with Capwire and insist that the case presents questions of fact such as the extent
and portion of the submarine cable system that lies within the jurisdiction of the said local governments,
as well as the nature of the so-called indefeasible rights as property of Capwire. 28 Such questions are
allegedly resolvable only before administrative agencies like the Local Board of Assessment Appeals. 29

The Court confronts the following issues:

Is the case cognizable by the administrative agencies and covered by the requirements in Sections 226
and 229 of the Local Government Code which makes the dismissal of Capwire's petition by the RTC
proper?

May submarine communications cables be classified as taxable real property by the local governments?

The petition is denied. No error attended the ruling of the appellate court that the case involves factual
questions that should have been resolved before the appropriate administrative bodies.

In disputes involving real property taxation, the general rule is to require the taxpayer to first avail of
administrative remedies and pay the tax under protest before allowing any resort to a judicial action,
except when the assessment itself is alleged to be illegal or is made without legal authority. 30

For example, prior resort to administrative action is required when among the issues raised is an
allegedly erroneous assessment, like when the reasonableness of the amount is challenged, while direct
court action is permitted when only the legality, power, validity or authority of the; assessment itself is
in question.JI Stated differently, the general rule of a prerequisite recourse to administrative remedies
applies when questions of fact are raised, but the exception of direct court action is allowed when
purely questions of law are involved.32

This Court has previously and rather succinctly discussed the difference between a question of fact and a
question of law. In Cosmos Bottling Corporation v. Nagrama, Jr., 33 it held:

The Court has made numerous dichotomies between questions of law and fact. A reading of these
dichotomies shows that labels attached to law and fact are descriptive rather than definitive. We are not
alone in Our difficult task of clearly distinguishing questions of fact from questions of law. The United
States Supreme Court has ruled that: "we [do not] yet know of any other rule or principle that will
unerringly distinguish a factual finding from a legal conclusion."

In Ramos v. Pepsi-Cola Bottling Co. of the PI., the Court ruled:

There is a question of law in a given case when the doubt or difference arises as to what the law is on a
certain state of facts; there is a question of fact when the doubt or difference arises as to the truth or
the falsehood of alleged facts.

We shall label this the doubt dichotomy.

In Republic v. Sandiganbayan, the Court ruled:

x x x A question of law exists when the doubt or controversy concerns the correct application of law or
jurisprudence to a certain set of facts; or when the issue does not call for an examination of the
probative value of the evidence presented, the truth or falsehood of facts being admitted. In contrast, a
question of fact exists when the doubt or difference arises as to the truth or falsehood of facts or when
the query invites calibration of the whole evidence considering mainly the credibility of the witnesses,
the existence and relevancy of specific surrounding circumstances as well as their relation to each other
and to the whole, and the probability of the situation.

For the sake of brevity, We shall label this the law application and calibration dichotomy.

In contrast, the dynamic legal scholarship in the United States has birthed many commentaries on the
question of law and question of fact dichotomy. As early as 1944, the law was described as growing
downward toward "roots of fact" which grew upward to meet it. In 1950, the late Professor Louis Jaffe
saw fact and law as a spectrum, with one shade blending imperceptibly into the other. Others have
defined questions of law as those that deal with the general body of legal principles; questions of fact
deal with "all other phenomena xx x." Kenneth Culp Davis also weighed in and noted that the difference
between fact and law has been characterized as that between "ought" questions and "is" questions. 34

Guided by the quoted pronouncement, the Court sustains the CA's finding that petitioner's case is one
replete with questions of fact instead of pure questions of law, which renders its filing in a judicial forum
improper because it is instead cognizable by local administrative bodies like the Board of Assessment
Appeals, which are the proper venues for trying these factual issues. Verily, what is alleged by Capwire
in its petition as "the crux of the controversy," that is, "whether or not an indefeasible right over a
submarine cable system that lies in international waters can be subject to real property tax in the
Philippines,"35 is not the genuine issue that the case presents - as it is already obvious and fundamental
that real property that lies outside of Philippine territorial jurisdiction cannot be subjected to its
domestic and sovereign power of real property taxation - but, rather, such factual issues as the extent
and status of Capwire's ownership of the system, the actual length of the cable/s that lie in Philippine
territory, and the corresponding assessment and taxes due on the same, because the public
respondents imposed and collected the assailed real property tax on the finding that at least a portion
or some portions of the submarine cable system that Capwire owns or co-owns lies inside Philippine
territory. Capwire's disagreement with such findings of the administrative bodies presents little to no
legal question that only the courts may directly resolve.

Instead, Capwire argues and makes claims on mere assumptions of certain facts as if they have been
already admitted or established, when they have not, since no evidence of such have yet been
presented in the proper agencies and even in the current petition. As such, it remains unsettled whether
Capwire is a mere co-owner, not full owner, of the subject submarine cable and, if the former, as to
what extent; whether all or certain portions of the cable are indeed submerged in water; and whether
the waters wherein the cable/s is/are laid are entirely outside of Philippine territorial or inland waters,
i.e., in international waters. More simply, Capwire argues based on mere legal conclusions, culminating
on its claim of illegality of respondents' acts, but the conclusions are yet unsupported by facts that
should have been threshed out quasi-judicially before the administrative agencies. It has been held that
"a bare characterization in a petition of unlawfulness, is merely a legal conclusion and a wish of the
pleader, and such a legal conclusion unsubstantiated by facts which could give it life, has no standing in
any court where issues must be presented and determined by facts in ordinary and concise
language."36 Therefore, Capwire's resort to judicial action, premised on its legal conclusion that its cables
(the equipment being taxed) lie entirely on international waters, without first administratively
substantiating such a factual premise, is improper and was rightly denied. Its proposition that the cables
lie entirely beyond Philippine territory, and therefore, outside of Philippine sovereignty, is a fact that is
not subject to judicial notice since, on the contrary, and as will be explained later, it is in fact certain that
portions of the cable would definitely lie within Philippine waters. Jurisprudence on the Local
Government Code is clear that facts such as these must be threshed out administratively, as the courts
in these types of cases step in at the first instance only when pure questions of law are involved.

Nonetheless, We proceed to decide on whether submarine wires or cables used for communications
may be taxed like other real estate.

We hold in the affirmative.

Submarine or undersea communications cables are akin to electric transmission lines which this Court
has recently declared in Manila Electric Company v. City Assessor and City Treasurer of Lucena City, 37 as
"no longer exempted from real prope1iy tax" and may qualify as "machinery" subject to real property
tax under the Local Government Code. To the extent that the equipment's location is determinable to
be within the taxing authority's jurisdiction, the Court sees no reason to distinguish between submarine
cables used for communications and aerial or underground wires or lines used for electric transmission,
so that both pieces of property do not merit a different treatment in the aspect of real property
taxation. Both electric lines and communications cables, in the strictest sense, are not directly adhered
to the soil but pass through posts, relays or landing stations, but both may be classified under the term
"machinery" as real property under Article 415(5) 38 of the Civil Code for the simple reason that such
pieces of equipment serve the owner's business or tend to meet the needs of his industry or works that
are on real estate. Even objects in or on a body of water may be classified as such, as "waters" is
classified as an immovable under Article 415(8)39 of the Code. A classic example is a boathouse which,
by its nature, is a vessel and, therefore, a personal property but, if it is tied to the shore and used as a
residence, and since it floats on waters which is immovable, is considered real property. 40 Besides, the
Court has already held that "it is a familiar phenomenon to see things classed as real property for
purposes of taxation which on general principle might be considered personal property." 41

Thus, absent any showing from Capwire of any express grant of an exemption for its lines and cables
from real property taxation, then this interpretation applies and Capwire's submarine cable may be held
subject to real property tax.

Having determined that Capwire is liable, and public respondents have the right to impose a real
property tax on its submarine cable, the issue that is unresolved is how much of such cable is taxable
based on the extent of Capwire's ownership or co-ownership of it and the length that is laid within
respondents' taxing jurisdiction. The matter, however, requires a factual determination that is best
performed by the Local and Central Boards of Assessment Appeals, a remedy which the petitioner did
not avail of.

At any rate, given the importance of the issue, it is proper to lay down the other legal bases for the local
taxing authorities' power to tax portions of the submarine cables of petitioner. It is not in dispute that
the submarine cable system's Landing Station in Nasugbu, Batangas is owned by PLDT and not by
Capwire. Obviously, Capwire is not liable for the real property tax on this Landing Station. Nonetheless,
Capwire admits that it co-owns the submarine cable system that is subject of the tax assessed and being
collected by public respondents. As the Court takes judicial notice that Nasugbu is a coastal town and
the surrounding sea falls within what the United Nations Convention on the Law of the Sea (UN CLOS)
would define as the country's territorial sea (to the extent of 12 nautical miles outward from the nearest
baseline, under Part II, Sections 1 and 2) over which the country has sovereignty, including the seabed
and subsoil, it follows that indeed a portion of the submarine cable system lies within Philippine
territory and thus falls within the jurisdiction of the said local taxing authorities. 42 It easily belies
Capwire's contention that the cable system is entirely in international waters. And even if such portion
does not lie in the 12-nautical-mile vicinity of the territorial sea but further inward, in Prof Magallona v.
Hon. Ermita, et al.43 this Court held that "whether referred to as Philippine 'internal waters' under A1iicle
I of the Constitution44 or as 'archipelagic waters' under UNCLOS Part III, Article 49(1, 2, 4),45 the
Philippines exercises sovereignty over the body of water lying landward of (its) baselines, including the
air space over it and the submarine areas underneath." Further, under Part VI, Article 7946 of the
UNCLOS, the Philippines clearly has jurisdiction with respect to cables laid in its territory that are utilized
in support of other installations and structures under its jurisdiction.

And as far as local government units are concerned, the areas described above are to be considered
subsumed under the term "municipal waters" which, under the Local Government Code, includes "not
only streams, lakes, and tidal waters within the municipality, not being the subject of private ownership
and not comprised within the national parks, public forest, timber lands, forest reserves or fishery
reserves, but also marine waters included between two lines drawn perpendicularly to the general
coastline from points where the boundary lines of the municipality or city touch the sea at low tide and
a third line parallel with the general coastline and fifteen (15) kilometers from it." 47 Although the term
"municipal waters" appears in the Code in the context of the grant of quarrying and fisheries privileges
for a fee by local governments,48 its inclusion in the Code's Book II which covers local taxation means
that it may also apply as guide in determining the territorial extent of the local authorities' power to levy
real property taxation.

Thus, the jurisdiction or authority over such part of the subject submarine cable system lying within
Philippine jurisdiction includes the authority to tax the same, for taxation is one of the three basic and
necessary attributes of sovereignty,49 and such authority has been delegated by the national legislature
to the local governments with respect to real property. 50 taxation.

As earlier stated, a way for Capwire to claim that its cable system is not covered by such authority is by
showing a domestic enactment or even contract, or an international agreement or treaty exempting the
same from real property taxation. It failed to do so, however, despite the fact that the burden of proving
exemption from local taxation is upon whom the subject real property is declared. 51 Under the Local
Government Code, every person by or for whom real property is declared, who shall claim tax
exemption for such property from real property taxation "shall file with the provincial, city or municipal
assessor within thirty (30) days from the date of the declaration of real property sufficient documentary
evidence in support of such claim."52 Capwire omitted to do so. And even under Capwire's legislative
franchise, RA 4387, which amended RA 2037, where it may be derived that there was a grant of real
property tax exemption for properties that are part of its franchise, or directly meet the needs of its
business,53 such had been expressly withdrawn by the Local Government Code, which took effect on
January l, 1992, Sections 193 and 234 of which provide: 54
Section 193. Withdrawal of Tax Exemption Privileges. – Unless otherwise provided in this Code, tax
exemptions or incentives granted to, or presently enjoyed by all persons, whether natural or juridical,
including government-owned or controlled corporations, except local water districts, cooperatives duly
registered under R.A. No. 6938, nonstock and nonprofit hospitals and educational institutions, arc
hereby withdrawn upon the effectivity of this Code.

xxxx

Section 234. Exemptions from Real Property Tax. - The following are exempted from payment of the real
property tax:

(a) Real property owned by the Republic of the Philippines or any of its political subdivisions except
when the beneficial use thereof has been granted, for consideration of otherwise, to a taxable person;

(b) Charitable institutions, churches, parsonages or convents appurtenant thereto, mosques, nonprofit
or religious cemeteries and all lands, buildings, and improvements actually, directly, and exclusively used
for religious, charitable or educational purposes;

(c) All machineries and equipment that are actually, directly and exclusively used by local water districts
and government-owned or controlled corporations engaged in the supply and distribution of water
and/or generation and transmission of electric power;

(d) All real property owned by duly registered cooperatives as provided for under R.A. No. 6938; and

(e) Machinery and equipment used for pollution control and environmental protection.

Except as provided herein, any exemption from payment of real property tax previously granted to, or
presently enjoyed by, all persons, whether natural or .iuridical, including all government-owned or
controlled corporations arc hereby withdrawn upon the cffectivity of this Code. 55

Such express withdrawal had been previously held effective upon exemptions bestowed by legislative
franchises granted prior to the effectivity of the Local Government Code. 56 Capwire fails to allege or
provide any other privilege or exemption that were granted to it by the legislature after the enactment
of the Local Government Code. Therefore, the presumption stays that it enjoys no such privilege or
exemption. Tax exemptions arc strictly construed against the taxpayer because taxes are considered the
lifeblood of the nation.57

WHEREFORE, the petition is DENIED. The Court of Appeals’ Decision dated May 30, 2007 and Resolution
dated October 8. 2007 are AFFIRMED.

SO ORDERED

G.R. No. L-26278             August 4, 1927

LEON SIBAL , plaintiff-appellant,

vs.
EMILIANO J. VALDEZ ET AL., defendants.
EMILIANO J. VALDEZ, appellee.

J. E. Blanco for appellant.

Felix B. Bautista and Santos and Benitez for appellee.
JOHNSON, J.:

The action was commenced in the Court of First Instance of the Province of Tarlac on the 14th day of
December 1924.

THE FACTS ARE ABOUT AS CONFLICTING AS IT IS POSSIBLE FOR FACTS TO BE, IN THE
TRIAL CAUSES.

As a first cause of action the plaintiff alleged that the defendant Vitaliano Mamawal, deputy sheriff of
the Province of Tarlac, by virtue of a writ of execution issued by the Court of First Instance of Pampanga,
attached and sold to the defendant Emiliano J. Valdez the sugar cane planted by the plaintiff and his
tenants on seven parcels of land described in the complaint in the third paragraph of the first cause of
action; that within one year from the date of the attachment and sale the plaintiff offered to redeem
said sugar cane and tendered to the defendant Valdez the amount sufficient to cover the price paid by
the latter, the interest thereon and any assessments or taxes which he may have paid thereon after the
purchase, and the interest corresponding thereto and that Valdez refused to accept the money and to
return the sugar cane to the plaintiff.

As a second cause of action, the plaintiff alleged that the defendant Emiliano J. Valdez was attempting to
harvest the palay planted in four of the seven parcels mentioned in the first cause of action; that he had
harvested and taken possession of the palay in one of said seven parcels and in another parcel described
in the second cause of action, amounting to 300 cavans; and that all of said palay belonged to the
plaintiff.

Plaintiff prayed that a writ of preliminary injunction be issued against the defendant Emiliano J. Valdez
his attorneys and agents, restraining them (1) from distributing him in the possession of the parcels of
land described in the complaint; (2) from taking possession of, or harvesting the sugar cane in question;
and (3) from taking possession, or harvesting the palay in said parcels of land. Plaintiff also prayed that a
judgment be rendered in his favor and against the defendants ordering them to consent to the
redemption of the sugar cane in question, and that the defendant Valdez be condemned to pay to the
plaintiff the sum of P1,056 the value of palay harvested by him in the two parcels above-mentioned
,with interest and costs.

On December 27, 1924, the court, after hearing both parties and upon approval of the bond for P6,000
filed by the plaintiff, issued the writ of preliminary injunction prayed for in the complaint.

The defendant Emiliano J. Valdez, in his amended answer, denied generally and specifically each and
every allegation of the complaint and step up the following defenses:

(a) That the sugar cane in question had the nature of personal property and was not, therefore, subject
to redemption;

(b) That he was the owner of parcels 1, 2 and 7 described in the first cause of action of the complaint;

(c) That he was the owner of the palay in parcels 1, 2 and 7; and

(d) That he never attempted to harvest the palay in parcels 4 and 5.

The defendant Emiliano J. Valdez by way of counterclaim, alleged that by reason of the preliminary
injunction he was unable to gather the sugar cane, sugar-cane shoots (puntas de cana dulce) palay in
said parcels of land, representing a loss to him of P8,375.20 and that, in addition thereto, he suffered
damages amounting to P3,458.56. He prayed, for a judgment (1) absolving him from all liability under
the complaint; (2) declaring him to be the absolute owner of the sugar cane in question and of the palay
in parcels 1, 2 and 7; and (3) ordering the plaintiff to pay to him the sum of P11,833.76, representing the
value of the sugar cane and palay in question, including damages.

Upon the issues thus presented by the pleadings the cause was brought on for trial. After hearing the
evidence, and on April 28, 1926, the Honorable Cayetano Lukban, judge, rendered a judgment against
the plaintiff and in favor of the defendants —

(1) Holding that the sugar cane in question was personal property and, as such, was not subject to
redemption;

(2) Absolving the defendants from all liability under the complaint; and

(3) Condemning the plaintiff and his sureties Cenon de la Cruz, Juan Sangalang and Marcos Sibal to
jointly and severally pay to the defendant Emiliano J. Valdez the sum of P9,439.08 as follows:

(a) P6,757.40, the value of the sugar cane;

(b) 1,435.68, the value of the sugar-cane shoots;

(c) 646.00, the value of palay harvested by plaintiff;

(d) 600.00, the value of 150 cavans of palay which the defendant was not able to raise by reason of the
injunction, at P4 cavan. 9,439.08 From that judgment the plaintiff appealed and in his assignments of
error contends that the lower court erred: (1) In holding that the sugar cane in question was personal
property and, therefore, not subject to redemption;

(2) In holding that parcels 1 and 2 of the complaint belonged to Valdez, as well as parcels 7 and 8, and
that the palay therein was planted by Valdez;

(3) In holding that Valdez, by reason of the preliminary injunction failed to realized P6,757.40 from the
sugar cane and P1,435.68 from sugar-cane shoots (puntas de cana dulce);

(4) In holding that, for failure of plaintiff to gather the sugar cane on time, the defendant was unable to
raise palay on the land, which would have netted him the sum of P600; and.

(5) In condemning the plaintiff and his sureties to pay to the defendant the sum of P9,439.08.

It appears from the record:

(1) That on May 11, 1923, the deputy sheriff of the Province of Tarlac, by virtue of writ of execution in
civil case No. 20203 of the Court of First Instance of Manila (Macondray & Co., Inc. vs. Leon Sibal),levied
an attachment on eight parcels of land belonging to said Leon Sibal, situated in the Province of Tarlac,
designated in the second of attachment as parcels 1, 2, 3, 4, 5, 6, 7 and 8 (Exhibit B, Exhibit 2-A).
(2) That on July 30, 1923, Macondray & Co., Inc., bought said eight parcels of land, at the auction held by
the sheriff of the Province of Tarlac, for the sum to P4,273.93, having paid for the said parcels separately
as follows (Exhibit C, and 2-A):

Parcel

1 ..................................................................... P1.00

2 ..................................................................... 2,000.00

3 ..................................................................... 120.93

4 ..................................................................... 1,000.00

5 ..................................................................... 1.00

6 ..................................................................... 1.00

7 with the house thereon .......................... 150.00

8 ..................................................................... 1,000.00
==========

4,273.93

(3) That within one year from the sale of said parcel of land, and on the 24th day of September, 1923,
the judgment debtor, Leon Sibal, paid P2,000 to Macondray & Co., Inc., for the account of the
redemption price of said parcels of land, without specifying the particular parcels to which said amount
was to applied. The redemption price said eight parcels was reduced, by virtue of said transaction, to
P2,579.97 including interest (Exhibit C and 2).

The record further shows:

(1) That on April 29, 1924, the defendant Vitaliano Mamawal, deputy sheriff of the Province of Tarlac, by
virtue of a writ of execution in civil case No. 1301 of the Province of Pampanga (Emiliano J.
Valdez vs. Leon Sibal 1.º — the same parties in the present case), attached the personal property of said
Leon Sibal located in Tarlac, among which was included the sugar cane now in question in the seven
parcels of land described in the complaint (Exhibit A).

(2) That on May 9 and 10, 1924, said deputy sheriff sold at public auction said personal properties of
Leon Sibal, including the sugar cane in question to Emilio J. Valdez, who paid therefor the sum of P1,550,
of which P600 was for the sugar cane (Exhibit A).
(3) That on April 29,1924, said deputy sheriff, by virtue of said writ of execution, also attached the real
property of said Leon Sibal in Tarlac, including all of his rights, interest and participation therein, which
real property consisted of eleven parcels of land and a house and camarin situated in one of said parcels
(Exhibit A).

(4) That on June 25, 1924, eight of said eleven parcels, including the house and the camarin, were
bought by Emilio J. Valdez at the auction held by the sheriff for the sum of P12,200. Said eight parcels
were designated in the certificate of sale as parcels 1, 3, 4, 5, 6, 7, 10 and 11. The house and camarin
were situated on parcel 7 (Exhibit A).

(5) That the remaining three parcels, indicated in the certificate of the sheriff as parcels 2, 12, and 13,
were released from the attachment by virtue of claims presented by Agustin Cuyugan and Domiciano
Tizon (Exhibit A).

(6) That on the same date, June 25, 1924, Macondray & Co. sold and conveyed to Emilio J. Valdez for
P2,579.97 all of its rights and interest in the eight parcels of land acquired by it at public auction held by
the deputy sheriff of Tarlac in connection with civil case No. 20203 of the Court of First Instance of
Manila, as stated above. Said amount represented the unpaid balance of the redemption price of said
eight parcels, after payment by Leon Sibal of P2,000 on September 24, 1923, fro the account of the
redemption price, as stated above. (Exhibit C and 2).

The foregoing statement of facts shows:

(1) The Emilio J. Valdez bought the sugar cane in question, located in the seven parcels of land described
in the first cause of action of the complaint at public auction on May 9 and 10, 1924, for P600.

(2) That on July 30, 1923, Macondray & Co. became the owner of eight parcels of land situated in the
Province of Tarlac belonging to Leon Sibal and that on September 24, 1923, Leon Sibal paid to
Macondray & Co. P2,000 for the account of the redemption price of said parcels.

(3) That on June 25, 1924, Emilio J. Valdez acquired from Macondray & Co. all of its rights and interest in
the said eight parcels of land.

(4) That on June 25, 1924, Emilio J. Valdez also acquired all of the rights and interest which Leon Sibal
had or might have had on said eight parcels by virtue of the P2,000 paid by the latter to Macondray.

(5) That Emilio J. Valdez became the absolute owner of said eight parcels of land.

The first question raised by the appeal is, whether the sugar cane in question is personal or real
property. It is contended that sugar cane comes under the classification of real property as "ungathered
products" in paragraph 2 of article 334 of the Civil Code. Said paragraph 2 of article 334 enumerates as
real property the following: Trees, plants, and ungathered products, while they are annexed to the land
or form an integral part of any immovable property." That article, however, has received in recent years
an interpretation by the Tribunal Supremo de España, which holds that, under certain conditions,
growing crops may be considered as personal property. (Decision of March 18, 1904, vol. 97, Civil
Jurisprudence of Spain.)
Manresa, the eminent commentator of the Spanish Civil Code, in discussing section 334 of the Civil
Code, in view of the recent decisions of the supreme Court of Spain, admits that growing crops are
sometimes considered and treated as personal property. He says:

No creemos, sin embargo, que esto excluya la excepcionque muchos autores hacen tocante a la venta
de toda cosecha o de parte de ella cuando aun no esta cogida (cosa frecuente con la uvay y la naranja), y
a la de lenas, considerando ambas como muebles. El Tribunal Supremo, en sentencia de 18 de marzo de
1904, al entender sobre un contrato de arrendamiento de un predio rustico, resuelve que su
terminacion por desahucio no extingue los derechos del arrendario, para recolectar o percibir los frutos
correspondientes al año agricola, dentro del que nacieron aquellos derechos, cuando el arrendor ha
percibido a su vez el importe de la renta integra correspondiente, aun cuando lo haya sido por precepto
legal durante el curso del juicio, fundandose para ello, no solo en que de otra suerte se daria al
desahucio un alcance que no tiene, sino en que, y esto es lo interesante a nuestro proposito, la
consideracion de inmuebles que el articulo 334 del Codigo Civil atribuge a los frutos pendientes, no les
priva del caracter de productos pertenecientes, como tales, a quienes a ellos tenga derecho, Ilegado el
momento de su recoleccion.

xxx     xxx     xxx

Mas actualmente y por virtud de la nueva edicion de la Ley Hipotecaria, publicada en 16 de diciembre de
1909, con las reformas introducidas por la de 21 de abril anterior, la hipoteca, salvo pacto expreso que
disponga lo contrario, y cualquiera que sea la naturaleza y forma de la obligacion que garantice, no
comprende los frutos  cualquiera que sea la situacion en que se encuentre. (3 Manresa, 5. edicion, pags.
22, 23.)

From the foregoing it appears (1) that, under Spanish authorities, pending fruits and ungathered
products may be sold and transferred as personal property; (2) that the Supreme Court of Spain, in a
case of ejectment of a lessee of an agricultural land, held that the lessee was entitled to gather the
products corresponding to the agricultural year, because said fruits did not go with the land but
belonged separately to the lessee; and (3) that under the Spanish Mortgage Law of 1909, as amended,
the mortgage of a piece of land does not include the fruits and products existing thereon, unless the
contract expressly provides otherwise.

An examination of the decisions of the Supreme Court of Louisiana may give us some light on the
question which we are discussing. Article 465 of the Civil Code of Louisiana, which corresponds to
paragraph 2 of article 334 of our Civil Code, provides: "Standing crops and the fruits of trees not
gathered, and trees before they are cut down, are likewise immovable, and are considered as part of the
land to which they are attached."

The Supreme Court of Louisiana having occasion to interpret that provision, held that in some cases
"standing crops" may be considered and dealt with as personal property. In the case of Lumber Co. vs.
Sheriff and Tax Collector  (106 La., 418) the Supreme Court said: "True, by article 465 of the Civil Code it
is provided that 'standing crops and the fruits of trees not gathered and trees before they are cut down .
. . are considered as part of the land to which they are attached, but the immovability provided for is
only one in abstracto and without reference to rights on or to the crop acquired by others than the
owners of the property to which the crop is attached. . . . The existence of a right on the growing crop is
a mobilization by anticipation, a gathering as it were in advance, rendering the crop movable quoad the
right acquired therein. Our jurisprudence recognizes the possible mobilization of the growing crop."
(Citizens' Bank  vs. Wiltz, 31 La. Ann., 244; Porche vs. Bodin, 28 La., Ann., 761; Sandel vs. Douglass, 27 La.
Ann., 629; Lewis vs. Klotz, 39 La. Ann., 267.)

"It is true," as the Supreme Court of Louisiana said in the case of Porche vs. Bodin  (28 La. An., 761) that
"article 465 of the Revised Code says that standing crops are considered as immovable and as part of the
land to which they are attached, and article 466 declares that the fruits of an immovable gathered or
produced while it is under seizure are considered as making part thereof, and incurred to the benefit of
the person making the seizure. But the evident meaning of these articles, is where the crops belong to
the owner of the plantation they form part of the immovable, and where it is seized, the fruits gathered
or produced inure to the benefit of the seizing creditor.

A crop raised on leased premises in no sense forms part of the immovable. It belongs to the lessee, and
may be sold by him, whether it be gathered or not, and it may be sold by his judgment creditors. If it
necessarily forms part of the leased premises the result would be that it could not be sold under
execution separate and apart from the land. If a lessee obtain supplies to make his crop, the factor's lien
would not attach to the crop as a separate thing belonging to his debtor, but the land belonging to the
lessor would be affected with the recorded privilege. The law cannot be construed so as to result in such
absurd consequences.

In the case of Citizen's Bank vs. Wiltz  (31 La. Ann., 244)the court said:

If the crop quoad  the pledge thereof under the act of 1874 was an immovable, it would be destructive
of the very objects of the act, it would render the pledge of the crop objects of the act, it would render
the pledge of the crop impossible, for if the crop was an inseparable part of the realty possession of the
latter would be necessary to that of the former; but such is not the case. True, by article 465 C. C. it is
provided that "standing crops and the fruits of trees not gathered and trees before they are cut down
are likewise immovable and are considered as part of the land to which they are attached;" but the
immovability provided for is only one in abstracto  and without reference to rights on or to the crop
acquired by other than the owners of the property to which the crop was attached. The immovability of
a growing crop is in the order of things temporary, for the crop passes from the state of a growing to
that of a gathered one, from an immovable to a movable. The existence of a right on the growing crop is
a mobilization by anticipation, a gathering as it were in advance, rendering the crop movable quoad  the
right acquired thereon. The provision of our Code is identical with the Napoleon Code 520, and we may
therefore obtain light by an examination of the jurisprudence of France.

The rule above announced, not only by the Tribunal Supremo de España  but by the Supreme Court of
Louisiana, is followed in practically every state of the Union.

From an examination of the reports and codes of the State of California and other states we find that
the settle doctrine followed in said states in connection with the attachment of property and execution
of judgment is, that growing crops raised by yearly labor and cultivation are considered personal
property. (6 Corpuz Juris, p. 197; 17 Corpus Juris, p. 379; 23 Corpus Juris, p. 329: Raventas vs. Green, 57
Cal., 254; Norris vs. Watson, 55 Am. Dec., 161; Whipple vs. Foot, 3 Am. Dec., 442; 1 Benjamin on Sales,
sec. 126; McKenzie vs. Lampley, 31 Ala., 526; Crine vs. Tifts and Co., 65 Ga., 644; Gillitt vs. Truax, 27
Minn., 528; Preston vs. Ryan, 45 Mich., 174; Freeman on Execution, vol. 1, p. 438; Drake on Attachment,
sec. 249; Mechem on Sales, sec. 200 and 763.)
Mr. Mechem says that a valid sale may be made of a thing, which though not yet actually in existence, is
reasonably certain to come into existence as the natural increment or usual incident of something
already in existence, and then belonging to the vendor, and then title will vest in the buyer the moment
the thing comes into existence. (Emerson vs. European Railway Co., 67 Me., 387; Cutting vs. Packers
Exchange, 21 Am. St. Rep., 63.) Things of this nature are said to have a potential existence. A man may
sell property of which he is potentially and not actually possessed. He may make a valid sale of the wine
that a vineyard is expected to produce; or the gain a field may grow in a given time; or the milk a cow
may yield during the coming year; or the wool that shall thereafter grow upon sheep; or what may be
taken at the next cast of a fisherman's net; or fruits to grow; or young animals not yet in existence; or
the good will of a trade and the like. The thing sold, however, must be specific and identified. They must
be also owned at the time by the vendor. (Hull vs. Hull, 48 Conn., 250 [40 Am. Rep., 165].)

It is contended on the part of the appellee that paragraph 2 of article 334 of the Civil Code has been
modified by section 450 of the Code of Civil Procedure as well as by Act No. 1508, the Chattel Mortgage
Law. Said section 450 enumerates the property of a judgment debtor which may be subjected to
execution. The pertinent portion of said section reads as follows: "All goods, chattels, moneys, and other
property, both real and personal, * * * shall be liable to execution. Said section 450 and most of the
other sections of the Code of Civil Procedure relating to the execution of judgment were taken from the
Code of Civil Procedure of California. The Supreme Court of California, under section 688 of the Code of
Civil Procedure of that state (Pomeroy, p. 424) has held, without variation, that growing crops were
personal property and subject to execution.

Act No. 1508, the Chattel Mortgage Law, fully recognized that growing crops are personal property.
Section 2 of said Act provides: "All personal property shall be subject to mortgage, agreeably to the
provisions of this Act, and a mortgage executed in pursuance thereof shall be termed a chattel
mortgage." Section 7 in part provides: "If growing crops be mortgaged the mortgage may contain an
agreement stipulating that the mortgagor binds himself properly to tend, care for and protect the crop
while growing.

It is clear from the foregoing provisions that Act No. 1508 was enacted on the assumption that "growing
crops" are personal property. This consideration tends to support the conclusion hereinbefore stated,
that paragraph 2 of article 334 of the Civil Code has been modified by section 450 of Act No. 190 and by
Act No. 1508 in the sense that "ungathered products" as mentioned in said article of the Civil Code have
the nature of personal property. In other words, the phrase "personal property" should be understood
to include "ungathered products."

At common law, and generally in the United States, all annual crops which are raised by yearly
manurance and labor, and essentially owe their annual existence to cultivation by man, . may be levied
on as personal property." (23 C. J., p. 329.) On this question Freeman, in his treatise on the Law of
Executions, says: "Crops, whether growing or standing in the field ready to be harvested, are, when
produced by annual cultivation, no part of the realty. They are, therefore, liable to voluntary transfer as
chattels. It is equally well settled that they may be seized and sold under execution. (Freeman on
Executions, vol. p. 438.)

We may, therefore, conclude that paragraph 2 of article 334 of the Civil Code has been modified by
section 450 of the Code of Civil Procedure and by Act No. 1508, in the sense that, for the purpose of
attachment and execution, and for the purposes of the Chattel Mortgage Law, "ungathered products"
have the nature of personal property. The lower court, therefore, committed no error in holding that
the sugar cane in question was personal property and, as such, was not subject to redemption.

All the other assignments of error made by the appellant, as above stated, relate to questions of fact
only. Before entering upon a discussion of said assignments of error, we deem it opportune to take
special notice of the failure of the plaintiff to appear at the trial during the presentation of evidence by
the defendant. His absence from the trial and his failure to cross-examine the defendant have lent
considerable weight to the evidence then presented for the defense.

Coming not to the ownership of parcels 1 and 2 described in the first cause of action of the complaint,
the plaintiff made a futile attempt to show that said two parcels belonged to Agustin Cuyugan and were
the identical parcel 2 which was excluded from the attachment and sale of real property of Sibal to
Valdez on June 25, 1924, as stated above. A comparison of the description of parcel 2 in the certificate
of sale by the sheriff (Exhibit A) and the description of parcels 1 and 2 of the complaint will readily show
that they are not the same.

The description of the parcels in the complaint is as follows:

1. La caña dulce sembrada por los inquilinos del ejecutado Leon Sibal 1.º en una parcela de terreno de la
pertenencia del citado ejecutado, situada en Libutad, Culubasa, Bamban, Tarlac, de unas dos hectareas
poco mas o menos de superficie.

2. La caña dulce sembrada por el inquilino del ejecutado Leon Sibal 1.º, Ilamado Alejandro Policarpio, en
una parcela de terreno de la pertenencia del ejecutado, situada en Dalayap, Culubasa, Bamban, Tarlac
de unas dos hectareas de superficie poco mas o menos." The description of parcel 2 given in the
certificate of sale (Exhibit A) is as follows:

2a. Terreno palayero situado en Culubasa, Bamban, Tarlac, de 177,090 metros cuadrados de superficie,
linda al N. con Canuto Sibal, Esteban Lazatin and Alejandro Dayrit; al E. con Francisco Dizon, Felipe Mañu
and others; al S. con Alejandro Dayrit, Isidro Santos and Melecio Mañu; y al O. con Alejandro Dayrit and
Paulino Vergara. Tax No. 2854, vador amillarado P4,200 pesos.

On the other hand the evidence for the defendant purported to show that parcels 1 and 2 of the
complaint were included among the parcels bought by Valdez from Macondray on June 25, 1924, and
corresponded to parcel 4 in the deed of sale (Exhibit B and 2), and were also included among the parcels
bought by Valdez at the auction of the real property of Leon Sibal on June 25, 1924, and corresponded
to parcel 3 in the certificate of sale made by the sheriff (Exhibit A). The description of parcel 4 (Exhibit 2)
and parcel 3 (Exhibit A) is as follows:

Parcels No. 4. — Terreno palayero, ubicado en el barrio de Culubasa,Bamban, Tarlac, I. F. de 145,000

metros cuadrados de superficie, lindante al Norte con Road of the barrio of Culubasa that goes to
Concepcion; al Este con Juan Dizon; al Sur con Lucio Maño y Canuto Sibal y al Oeste con Esteban Lazatin,
su valor amillarado asciende a la suma de P2,990. Tax No. 2856.

As will be noticed, there is hardly any relation between parcels 1 and 2 of the complaint and parcel 4
(Exhibit 2 and B) and parcel 3 (Exhibit A). But, inasmuch as the plaintiff did not care to appear at the trial
when the defendant offered his evidence, we are inclined to give more weight to the evidence adduced
by him that to the evidence adduced by the plaintiff, with respect to the ownership of parcels 1 and 2 of
the compliant. We, therefore, conclude that parcels 1 and 2 of the complaint belong to the defendant,
having acquired the same from Macondray & Co. on June 25, 1924, and from the plaintiff Leon Sibal on
the same date.

It appears, however, that the plaintiff planted the palay in said parcels and harvested therefrom 190
cavans. There being no evidence of bad faith on his part, he is therefore entitled to one-half of the crop,
or 95 cavans. He should therefore be condemned to pay to the defendant for 95 cavans only, at P3.40 a
cavan, or the sum of P323, and not for the total of 190 cavans as held by the lower court.

As to the ownership of parcel 7 of the complaint, the evidence shows that said parcel corresponds to
parcel 1 of the deed of sale of Macondray & Co, to Valdez (Exhibit B and 2), and to parcel 4 in the
certificate of sale to Valdez of real property belonging to Sibal, executed by the sheriff as above stated
(Exhibit A). Valdez is therefore the absolute owner of said parcel, having acquired the interest of both
Macondray and Sibal in said parcel.

With reference to the parcel of land in Pacalcal, Tarlac, described in paragraph 3 of the second cause of
action, it appears from the testimony of the plaintiff himself that said parcel corresponds to parcel 8 of
the deed of sale of Macondray to Valdez (Exhibit B and 2) and to parcel 10 in the deed of sale executed
by the sheriff in favor of Valdez (Exhibit A). Valdez is therefore the absolute owner of said parcel, having
acquired the interest of both Macondray and Sibal therein.

In this connection the following facts are worthy of mention:

Execution in favor of Macondray & Co., May 11, 1923. Eight parcels of land were attached under said
execution. Said parcels of land were sold to Macondray & Co. on the 30th day of July, 1923. Rice paid
P4,273.93. On September 24, 1923, Leon Sibal paid to Macondray & Co. P2,000 on the redemption of
said parcels of land. (See Exhibits B and C ).

Attachment, April 29, 1924, in favor of Valdez. Personal property of Sibal was attached, including the
sugar cane in question. (Exhibit A) The said personal property so attached, sold at public auction May 9
and 10, 1924. April 29, 1924, the real property was attached under the execution in favor of Valdez
(Exhibit A). June 25, 1924, said real property was sold and purchased by Valdez (Exhibit A).

June 25, 1924, Macondray & Co. sold all of the land which they had purchased at public auction on the
30th day of July, 1923, to Valdez.

As to the loss of the defendant in sugar cane by reason of the injunction, the evidence shows that the
sugar cane in question covered an area of 22 hectares and 60 ares (Exhibits 8, 8-b and 8-c); that said
area would have yielded an average crop of 1039 picos and 60 cates; that one-half of the quantity, or
519 picos and 80 cates would have corresponded to the defendant, as owner; that during the season the
sugar was selling at P13 a pico (Exhibit 5 and 5-A). Therefore, the defendant, as owner, would have
netted P 6,757.40 from the sugar cane in question. The evidence also shows that the defendant could
have taken from the sugar cane 1,017,000 sugar-cane shoots (puntas de cana) and not 1,170,000 as
computed by the lower court. During the season the shoots were selling at P1.20 a thousand (Exhibits 6
and 7). The defendant therefore would have netted P1,220.40 from sugar-cane shoots and not
P1,435.68 as allowed by the lower court.
As to the palay harvested by the plaintiff in parcels 1 and 2 of the complaint, amounting to 190 cavans,
one-half of said quantity should belong to the plaintiff, as stated above, and the other half to the
defendant. The court erred in awarding the whole crop to the defendant. The plaintiff should therefore
pay the defendant for 95 cavans only, at P3.40 a cavan, or P323 instead of P646 as allowed by the lower
court.

The evidence also shows that the defendant was prevented by the acts of the plaintiff from cultivating
about 10 hectares of the land involved in the litigation. He expected to have raised about 600 cavans of
palay, 300 cavans of which would have corresponded to him as owner. The lower court has wisely
reduced his share to 150 cavans only. At P4 a cavan, the palay would have netted him P600.

In view of the foregoing, the judgment appealed from is hereby modified. The plaintiff and his sureties
Cenon de la Cruz, Juan Sangalang and Marcos Sibal are hereby ordered to pay to the defendant jointly
and severally the sum of P8,900.80, instead of P9,439.08 allowed by the lower court, as follows:

P6,757.40 for the sugar cane;

1,220.40 for the sugar cane shoots;

323.00 for the palay harvested by plaintiff in parcels 1 and 2;

600.00 for the palay which defendant could have raised.

8,900.80
============

In all other respects, the judgment appealed from is hereby affirmed, with costs. So ordered.

G.R. No. 218269, June 06, 2018

IN RE: APPLICATION FOR LAND REGISTRATION

SUPREMA T. DUMO, Petitioner, v. REPUBLIC OF THE PHILIPPINES, Respondent.

DECISION

CARPIO, J.:*

The Case

This is a petition for review on certiorari under Rule 45 of the Rules of Court. Petitioner Suprema T.
Dumo (Dumo) challenges the 28 January 2014 Decision 1 and the 19 May 2015 Resolution2 of the Court of
Appeals (CA) in CA-G.R. CV No. 95732, which modified the Joint Decision of the Regional Trial Court
(RTC), Branch 67, Bauang, La Union, in Civil Case No. 1301-Bg for Accion Reivindicatoria3 and LRC Case
No. 270-Bg for Application for Land Registration. 4

The Facts

Severa Espinas, Erlinda Espinas, Aurora Espinas, and Virginia Espinas filed a Complaint for Recovery of
Ownership, Possession and Damages with Prayer for Writ of Preliminary Injunction against the heirs of
Bernarda M. Trinidad (Trinidad), namely, Leticia T. Valmonte, Lydia T. Nebab, Purita T. Tanag, Gloria T.
Antolin, Nilo Trinidad, Elpidio Trinidad, Fresnida T. Saldana, Nefresha T. Tolentino, and Dumo. The
plaintiffs are the heirs of Marcelino Espinas (Espinas), who died intestate on 6 November 1991, leaving a
parcel of land (Subject Property) covered by Tax Declaration No. 13823-A, which particularly described
the property as follows:

A parcel of land located [in] Paringao, Bauang, La Union classified as unirrigated Riceland with an area of
1,065 square meters covered by Tax Declaration No. 13823-A, bounded on the North by Felizarda N.
Mabalay; on the East by Pedro Trinidad; on the South by Girl Scout[s] of the Philippines and on the West
by China Sea and assessed at P460.00.5

The Subject Property was purchased by Espinas from Carlos Calica through a Deed of Absolute Sale
dated 19 October 1943. Espinas exercised acts of dominion over the Subject Property by appointing a
caretaker to oversee and administer the property. In 1963, Espinas executed an affidavit stating his
claim of ownership over the Subject Property. Espinas had also been paying realty taxes on the Subject
Property.

Meanwhile, on 6 February 1987, the heirs of Trinidad executed a Deed of Partition with Absolute Sale
over a parcel of land covered by Tax Declaration No. 17276, which particularly described the property as
follows:

A parcel of sandy land located [in] Paringao, Bauang, La Union, bounded on the North by Emiliana
Estepa, on the South by Carlos Calica and Girl Scout[s] Camp and on the West by China Sea, containing
an area of 1[,]514 square meters more or less, with an assessed value [of] P130.00.6

Finding that the Deed of Partition with Absolute Sale executed by the heirs of Trinidad included the
Subject Property, the heirs of Espinas filed a Complaint for Recovery of Ownership, Possession and
Damages to protect their interests (Civil Case No. 1301-Bg). The heirs of Espinas also sought a
Temporary Restraining Order to enjoin the Writ of Partial Execution of the Decision in Civil Case No. 881,
a Forcible Entry complaint filed by the heirs of Trinidad against them.

In the Complaint for Recovery of Ownership, Possession and Damages, Dumo, one of the defendants
therein, filed a Motion to Dismiss based on res judicata. Dumo argued that Espinas had already applied
for the registration of the Subject Property and that such application had been dismissed. The dismissal
of the land registration application of Espinas was affirmed by the CA, and attained finality on 5
December 1980.

The Motion to Dismiss filed by Dumo was denied by the RTC, which held that the land registration case
cannot operate as a bar to the Complaint for Recovery of Ownership, Possession and Damages because
the decision in the land registration case did not definitively and conclusively adjudicate the ownership
of the Subject Property in favor of any of the parties.

The heirs of Trinidad thereafter filed their collective Answer, where they denied the material allegations
in the complaint.

Additionally, Dumo filed an application for registration of two parcels of land, covered by Advance Plan
of Lot Nos. 400398 and 400399 with a total area of 1,273 square meters (LRC Case No. 270-Bg). Dumo
alleged that the lots belonged to her mother and that she and her siblings inherited them upon their
mother's death. She further alleged that through a Deed of Partition with Absolute Sale dated 6
February 1987, she acquired the subject lots from her siblings. Dumo traces her title from her mother,
Trinidad, who purchased the lots from Florencio Mabalay in August 1951. Mabalay was Dumo's
maternal grandfather. Mabalay, on the other hand, purchased the properties from Carlos Calica.

The heirs of Espinas opposed Dumo's application for land registration on the ground that the properties
sought to be registered by Dumo are involved in the accion reivindicatoria case. Thus, the RTC
consolidated the land registration case with the Complaint for Recovery of Ownership, Possession and
Damages.

The Office of the Solicitor General entered its appearance and filed its opposition for the State in the
land registration case.

The Ruling of the RTC

On 2 July 2010, the RTC rendered its Joint Decision, finding that the Subject Property was owned by the
heirs of Espinas. The RTC ordered the dismissal of Dumo's land registration application on the ground of
lack of registerable title, and ordered Dumo to restore ownership and possession of the lots to the heirs
of Espinas. The dispositive portion of the Joint Decision reads:

WHEREFORE, premises considered[,] judgment is rendered:

In LRC Case No. 270-Bg: Ordering the dismissal of the land registration on [the] ground of lack of
registerable title on the part of Suprema Dumo.

In Civil Case No. 1301-Bg: Declaring the Heirs of Marcelino Espinas as the owners of the lots subject of
[the] application; ordering the applicant-defendant Suprema Dumo to restore ownership and possession
of the lots in question to the Heirs of Marcelino Espinas.

SO ORDERED.7

The RTC found that based on the evidence presented, the heirs of Espinas had a better right to the
Subject Property. In particular, the RTC found that based on the records of the Bureau of Lands, the lot
of Espinas was previously surveyed and approved by the Bureau of Lands and when the survey was
made for Trinidad, there was already an approved plan for Espinas. Also, the RTC found that the tax
declarations submitted by Dumo in support of her application failed to prove any rights over the land.
Specifically, the tax declaration of Mabalay, from whom Dumo traces her title, showed that the land was
first described as bounded on the west by Espinas. The subsequent tax declaration in the name of
Trinidad, which cancelled the tax declaration in the name of Mabalay, showed that the land was no
longer bounded on the west by Espinas, but rather, by the China Sea. The area of the lot also increased
from 3,881 to 5,589 square meters. All of the subsequent tax declarations submitted by Dumo covering
the lot in the name of her mother stated that the lot was no longer bounded on the west by Espinas, but
rather, by the China Sea. The RTC held that the only logical explanation to the inconsistency in the
description of the land and the corresponding area thereof is that the lot of Espinas was included in the
survey conducted for Trinidad.

The RTC also rejected the theory of Dumo that the lot of Espinas was eaten by the sea. The RTC found
that during the ocular inspection, it was established that the lots adjoining the lot of Espinas on the
same shoreline were not inundated by the sea. To hold the theory posited by Dumo to be true, the RTC
reasoned that all the adjoining lots should also have been inundated by the sea. However, it was
established through the ocular inspection that the lots adjoining the property of Espinas on the same
shoreline remained the same, and thus the Subject Property had not been eaten by the sea.

The Ruling of the CA

The CA rendered its Decision dated 28 January 2014, affirming the RTC's decision dismissing the
application for land registration of Dumo, and finding that she failed to demonstrate that she and her
predecessors-in interest possessed the property in the manner required by law to merit the grant of her
application for land registration.

The CA, however, modified the decision of the RTC insofar as it found that the Subject Property
belonged to the heirs of Espinas. The CA found that since the property still belonged to the public
domain, and the heirs of Espinas were not able to establish their open, continuous, exclusive and
notorious possession and occupation of the land under a bona fide claim of ownership since 12 June
1945 or earlier, it was erroneous for the RTC to declare the heirs of Espinas as the owners of the Subject
Property.

The dispositive portion of the Decision of the CA reads:

WHEREFORE, premises considered, the Appeal is PARTLY GRANTED and the assailed Joint Decision
issued by the court a quo is hereby MODIFIED in that the Complaint for Accion Reivindicatoria (Civil Case
No. 1301-Bg) filed by plaintiffs-appellees is DISMISSED for lack of cause of action.

The Decision is AFFIRMED in all other respects.

SO ORDERED.8

Dumo filed a Motion for Partial Reconsideration and subsequently, an Omnibus Motion for Entry of
Judgment and to Resolve, asking the CA to issue an entry of judgment insofar as the civil case is
concerned and to declare the land registration case submitted for resolution without any
comment/opposition. The CA denied both motions in a Resolution dated 19 May 2015. 9

Hence, this petition.

The Issues

In this petition, Dumo seeks a reversal of the decision of the CA, and raises the following arguments:

A. THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR WHEN, IN DENYING THE
PETITION FOR LAND REGISTRATION, IT WENT BEYOND THE ISSUES RAISED, THEREBY VIOLATING OR
CONTRAVENING THE RULING OF THIS HONORABLE COURT IN, AMONG OTHERS, "LAM V. CHUA, 426
SCRA 29; DEPARTMENT OF AGRARIAN REFORM V. FRANCO, 471 SCRA 74; BERNAS V. COURT OF
APPEALS, 225 SCRA 119; PROVINCE OF QUEZON V. MARTE, 368 SCRA 145 AND FIVE STAR BUS CO., INC.
V. COURT OF APPEALS, 259 SCRA 120."

B. THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR WHEN, IN DENYING THE
PETITION FOR LAND [REGISTRATION], IT RULED THAT PETITIONER AND HER PREDECESSORS-IN-INTEREST
FAILED TO PROVE CONTINUOUS, EXCLUSIVE, AND ADVERSE POSSESSION AND OCCUPATION OF THE
SUBJECT PROPERTY IN THE CONCEPT OF [AN] OWNER FROM JUNE 12, 1945 OR EARLIER, THEREBY
VIOLATING OR CONTRAVENING THE RULING OF THIS HONORABLE COURT IN "REPUBLIC OF THE
PHILIPPINES VERSUS COURT OF APPEALS, 448 SCRA 442."

C. THAT, IN ANY EVENT, AND WITHOUT PREJUDICE TO THE FOREGOING, THE HONORABLE COURT OF
AP[P]EALS COMMITTED A REVERSIBLE ERROR WHEN, IN DENYING THE PETITION FOR LAND
REGISTRATION, IT FAILED TO CONSIDER PETITIONER'S EXHIBIT 'A' WHICH WAS FORMALLY OFFERED TO
PROVE THAT THE SUBJECT PROPERTY WAS DISPOSIBLE [sic] AND ALIENABLE TO WHICH THE
RESPONDENT MADE NO OBJECTION[.]

D. THAT FURTHER, AND WITHOUT PREJUDICE TO THE FOREGOING, THE HONORABLE COURT OF
APPEALS COMMITTED A REVERSIBLE ERROR WHEN, IN DENYING THE PETITION FOR LAND
REGISTRATION, IT FAILED TO CONSIDER THE SUPPORTING EVIDENCE THEREFOR, AGAIN, WITHOUT
OBJECTION FROM THE RESPONDENT, THEREBY DEPRIVING PETITIONER OF HER FUNDAMENTAL RIGHT
TO DUE PROCESS OF LAW.10

The Ruling of the Court

Essentially, Dumo argues that the CA committed a reversible error because (1) the issue of whether she
was in open, continuous, exclusive and notorious possession of the land since 12 June 1945 was not an
issue in the RTC; (2) the requirement of possession and occupation from 12 June 1945 is not essential to
her application since she has acquired title over the land by prescription; (3) she has proven that the
land applied for has already been declared alienable and disposable; and (4) her right to due process
was violated since the issues considered by the CA were not properly raised during the trial.

We find that none of Dumo's arguments deserve any merit.

Going beyond the issues raised in the RTC and due process of law

Dumo argues that the issue of whether the possession started on 12 June 1945 or earlier was never
raised in the RTC. She also argues that no issue was raised as to whether or not the land that she seeks
to register is alienable and disposable. Thus, Dumo argues that the CA erred, and also violated her right
to due process, when it considered these issues in determining whether or not the application for land
registration should be granted.
We do not agree.

In an application for land registration, it is elementary that the applicant has the burden of proving, by
clear, positive and convincing evidence, that her alleged possession and occupation were of the nature
and duration required by law.11 Thus, it was upon Dumo to prove that she and her predecessors-in-
interest possessed and occupied the land sought to be registered in the nature and duration required by
law.

Dumo cannot validly argue that she was not afforded due process when the CA considered to review the
evidence she herself offered to support her application for land registration. On the contrary, she was
given every opportunity to submit the documents to establish her right to register the land. She simply
failed to do so.

When Dumo filed with the RTC the application for registration of her land, she was asking the RTC to
confirm her incomplete title. The requirements for judicial confirmation of imperfect title are found in
Section 14 of Presidential Decree No. 1529 (PD No. 1529), which provides:

Section 14. Who may apply. The following persons may file in the proper Court of First Instance an
application for registration of title to land, whether personally or through their duly authorized
representatives:

(1) Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of alienable and disposable lands of the public
domain under a bona fide claim of ownership since June 12, 1945, or earlier.

(2) Those who have acquired ownership of private lands by prescription under the provision of existing
laws.

(3) Those who have acquired ownership of private lands or abandoned river beds by right of accession
or accretion under the existing laws.

(4) Those who have acquired ownership of land in any other manner provided for by law.

xxxx

Thus, it is necessary in an application for land registration that the court determines whether or not an
applicant fulfills the requirements under any of the paragraphs of Section 14 of PD No. 1529.

Simply put, when Dumo filed her application for the registration of the lots she claims to have inherited
from her mother and bought from her siblings, the issue of whether she complied with all the
requirements was the very crux of the application. It cannot be argued that because the Republic failed
to oppose or raise the issue in the RTC, the CA may no longer consider this issue. On the contrary, the
classification of the land sought to be registered, and the duration and nature of the possession and
occupation have always been, and will always be the issues in an application for land registration. It
would truly be absurd for Dumo, or any other applicant for land registration, to expect the courts to
grant the application without first determining if the requisites under the law have been complied with.

The CA had every right to look into the compliance by Dumo with the requirements for the registration
of the land, and we find that the CA correctly found that Dumo has acquired no registerable title to the
lots she seeks to register.
Registration of land under Section 14(1)

To reiterate, under Section 14(1) of PD No. 1529, Dumo had the burden of proving the following:

(1) that the land or property forms part of the alienable and disposable lands of the public domain;

(2) that the applicant and his predecessors-in-interest have been in open, continuous, exclusive, and
notorious possession and occupation of the same; and

(3) that it is under a bona fide claim of ownership since 12 June 1945, or earlier. 12

The first requirement is to prove that the land sought to be registered is alienable and disposable land of
the public domain. This is because under the Regalian Doctrine, as embodied in the 1987 Philippine
Constitution, lands which do not clearly appear to be within private ownership are presumed to belong
to the State.13 Thus, in an application for land registration, the applicant has the burden of overcoming
the presumption that the State owns the land applied for, and proving that the land has already been
classified as alienable and disposable.14 To overcome the presumption that the land belongs to the State,
the applicant must prove by clear and incontrovertible evidence at the time of application that the land
has been classified as alienable and disposable land of the public domain.

Classification of lands of the public domain may be found under Article XII of the 1987 Philippine
Constitution. More specifically, Section 3 of Article XII classifies lands of the public domain into (1)
agricultural, (2) forest or timber, (3) mineral lands, and (4) national parks. 15 Of these four classifications,
only agricultural lands may be alienated and disposed of by the State.

The 1987 Philippine Constitution also provides that "agricultural lands of the public domain may be
further classified by law according to the uses to which they may be devoted." 16 Based on the foregoing,
it is clear that the classification of lands of the public domain is first and foremost provided by the
Constitution itself. Of the classifications of lands of the public domain, agricultural lands may further be
classified by law, according to the uses it may be devoted to.

The classification of lands of the public domain into agricultural lands, as well as their further
classification into alienable and disposable lands of the public domain, is a legislative prerogative which
may be exercised only through the enactment of a valid law. This prerogative has long been exercised by
the legislative department through the enactment of Commonwealth Act No. 141 (CA No. 141) or the
Public Land Act of 1936.17 Section 6 of CA No. 141 remains to this day the existing general law governing
the classification of lands of the public domain into alienable and disposable lands of the public
domain.18

Section 182719of the Revised Administrative Code of 191720 merely authorizes the Department Head to
classify as agricultural lands those forest lands which are better adapted and more valuable for
agricultural purposes. Section 1827 does not authorize the Department Head to classify agricultural
lands as alienable and disposable lands as this power is expressly delegated by the same Revised
Administrative Code of 1917 solely to the Governor-General.

The existing administrative code under the 1987 Philippine Constitution is Executive Order No. 292 or
the Administrative Code of 1987. This existing code did not reenact Section 1827 of the Revised
Administrative Code of 1917. Nevertheless, in the absence of incompatibility between Section 1827 of
the Revised Administrative Code of 1917 and the provisions of the Administrative Code of 1987, we can
grant that Section 1827 has not been repealed. 21 This is in view of the repealing clause in Section 27,
Final Provisions, Book VII of the Administrative Code of 1987, which provides:

Section 27. All laws, decrees, orders, rules and regulations, or portions thereof, inconsistent with this
Code are hereby repealed or modified accordingly.

The authority of the Department Head under Section 1827 of the Revised Administrative Code of 1917 is
merely to classify public forest lands as public agricultural lands. Agricultural lands of the public domain
are, by themselves, not alienable and disposable. Section 1827 of the Revised Administrative Code of
1917 provides:

Section 1827. Assignment of Forest Land for Agricultural Purposes. – Lands in public forests, not
including forest reserves, upon the certification of the Director of Forestry that said lands are better
adapted and more valuable for agricultural than for forest purposes and not required by the public
interests to be kept under forest, shall be declared by the Department Head to be agricultural
lands. (Emphasis supplied)

There is nothing in Section 1827 that authorizes the Department Head to classify agricultural lands into
alienable or disposable lands of the public domain. The power to classify public lands as agricultural
lands is separate and distinct from the power to declare agricultural lands as alienable and disposable.
The power to alienate agricultural lands of the public domain can never be inferred from the power to
classify public lands as agricultural. Thus, public lands classified as agricultural and used by the Bureau of
Plant Industry of the Department of Agriculture for plant research or plant propagation are not
necessarily alienable and disposable lands of the public domain despite being classified as agricultural
lands. For such agricultural lands to be alienable and disposable, there must be an express proclamation
by the President declaring such agricultural lands as alienable and disposable.

Agricultural land, the only classification of land which may be classified as alienable and disposable
under the 1987 Philippine Constitution, may still be reserved for public or quasi-public purposes which
would prohibit the alienation or disposition of such land. Section 8 of CA No. 141 provides:

Section 8. Only those lands shall be declared open to disposition or concession which have been
officially delimited and classified and, when practicable, surveyed, and which have not been reserved
for public or quasi-public uses, nor appropriated by the Government, nor in any manner become private
property, nor those on which a private right authorized and recognized by this Act or any other valid law
may be claimed, or which, having been reserved or appropriated, have ceased to be so. However, the
President may, for reasons of public interest, declare lands of the public domain open to disposition
before the same have had their boundaries established or been surveyed, or may, for the same
reason, suspend their concession or disposition until they are again declared open to concession or
disposition by proclamation duly published or by Act of the National Assembly. (Emphasis supplied)

Thus, to be alienable and disposable, lands of the public domain must be expressly declared as alienable
and disposable by executive or administrative proclamation pursuant to law or by an Act of Congress.

Even if the Department Head has the power to classify public forest lands as agricultural under Section
1827 of the Revised Administrative Code of 1917, this does not include the power to classify public
agricultural lands as alienable and disposable lands of the public domain. The power to further classify
agricultural lands as alienable and disposable has not been granted in any way to the Department Head
under the Revised Administrative Code of 1917. This authority was given only to the Governor-General
under Section 64 of the Revised Administrative Code of 1917, as superseded by Section 9 of Republic Act
(RA) No. 2874 (Public Land Act of 1919), and as in turn further superseded by Section 6 of CA No. 141
(Public Land Act of 1936), which is the existing specific provision of law governing the classification of
lands of the public domain into alienable and disposable lands of the public domain. This delegated
power is a discretionary power, to be exercised based on the sound discretion of the President.

Under Section 64 of the Revised Administrative Code of 1917, the classification of lands of the public
domain into alienable and disposable lands of the public domain could only be made by the Governor-
General. While Section 1827 of the Revised Administrative Code of 1917 gave to the Department Head
the power to classify public forest lands as public agricultural lands, the very same law in its Section 64
expressly reserved to the Governor-General the power to declare for "public sale x x x any of the public
domain of the Philippines." Section 64 of the Revised Administrative Code of 1917 provides:

Section 64. Particular powers and duties of Governor-General of the Philippines. – In addition to his
general supervisory authority, the Governor-General of the Philippines shall have such specific powers
and duties as are expressly conferred or imposed on him by law and also, in particular, the powers and
duties set forth in this chapter.

Among such special powers and duties shall be:

(a) x x x

xxxx

(d) To reserve from settlement or public sale and for specific public uses any of the public domain of
the (Philippine Islands) Philippines the use of which is not otherwise directed by law, the same
thereafter remaining subject to the specific public uses indicated in the executive order by which such
reservation is made, until otherwise provided by law or executive order.

(e) To reserve from sale or other disposition and for specific public uses or service, any land belonging to
the private domain of the Government of the (Philippine Islands) Philippines, the use of which is not
otherwise directed by law; and thereafter such land shall not be subject to sale or other disposition and
shall be used for the specific purposes directed by such executive order until otherwise provided by law.

x x x x (Emphasis supplied)

Likewise, under Section 9 of RA No. 2874, the classification of lands of public domain into alienable and
disposable lands could only be made by the Governor-General, thus:

Section 9. For the purposes of their government and disposition, the lands of the public domain
alienable or open to disposition shall be classified, according to the use or purposes to which such lands
are destined, as follows:

(a) Agricultural

(b) Commercial, industrial, or for similar productive purposes.

(c) Educational, charitable, and other similar purposes.

(d) Reservations for town sites, and for public and quasi-public uses.

The Governor-General, upon recommendation by the Secretary of Agriculture and Natural Resources,
shall from time to time make the classification provided for in this section, and may, at any time and
in a similar manner, transfer lands from one class to another. (Emphasis supplied)

Similarly, under Section 6 of CA No. 141, the existing law on the matter, only the President can classify
lands of the public domain into alienable or disposable lands, thus:

Section 6. The President, upon the recommendation of the Secretary of Agriculture and
Commerce, shall from time to time classify the lands of the public domain into —

(a) Alienable or disposable,

(b) Timber, and
(c) Mineral lands,

and may at any time and in a like manner transfer such lands from one class to another, for the
purposes of their administration and disposition. (Emphasis supplied)

Thus, under all laws during the American regime, from the Revised Administrative Code of 1917 up to
and including CA No. 141, only the Governor-General or President could classify lands of the public
domain into alienable and disposable lands. No other government official was empowered by statutory
law during the American regime. Under the 1935, 22 197323 and 198724 Philippine Constitutions, the
power to declare or classify lands of the public domain as alienable and disposable lands belonged to
Congress. This legislative power is still delegated to the President under Section 6 of CA No. 141 since
this Section 6 was never repealed by Congress despite successive amendments to CA No. 141 after the
adoption of the 1935, 1973 and the 1987 Philippine Constitutions. 25

Under Section 13 of PD No. 705, otherwise known as the Revised Forestry Code of the Philippines, the
Department of Environment and Natural Resources (DENR) Secretary has been delegated by law the
discretionary power to classify as alienable and disposable forest lands of the public domain no longer
needed for forest reserves. Section 13 of the Revised Forestry Code of the Philippines, which was
enacted on 19 May 1975, provides:

Section 13. System of Land Classification.– The Department Head shall study, devise, determine and
prescribe the criteria, guidelines and methods for the proper and accurate classification and survey of all
lands of the public domain into agricultural, industrial or commercial, residential, resettlement, mineral,
timber or forest, and grazing lands, and into such other classes as now or may hereafter be provided by
law, rules and regulations.

In the meantime, the Department Head shall simplify through inter-bureau action the present system of
determining which of the unclassified lands of the public domain are needed for forest purposes and
declare them as permanent forest to form part of the forest reserves. He shall declare those classified
and determined not to be needed for forest purposes as alienable and disposable lands, the
administrative jurisdiction and management of which shall be transferred to the Bureau of Lands:
Provided, That mangrove and other swamps not needed for shore protection and suitable for fishpond
purposes shall be released to, and be placed under the administrative jurisdiction and management of,
the Bureau of Fisheries and Aquatic Resources. Those still to be classified under the present system shall
continue to remain as part of the public forest. (Emphasis supplied)

Section 3, Article XII of the 1987 Philippine Constitution states: "x x x. Alienable lands of the public
domain shall be limited to agricultural lands. x x x." Thus, the unclassified lands of the public domain, not
needed for forest reserve purposes, must first be declared agricultural lands of the public domain before
the DENR Secretary can declare them alienable and disposable. Under the foregoing Section 13 of PD
No. 705, the DENR Secretary has no discretionary power to classify unclassified lands of the public
domain, not needed for forest reserve purposes, into agricultural lands. However, the DENR Secretary
can invoke his power under Section 1827 of the Revised Administrative Code of 1917 to classify forest
lands into agricultural lands. Once so declared as agricultural lands of the public domain, the DENR
Secretary can then invoke his delegated power under Section 13 of PD No. 705 to declare such
agricultural lands as alienable and disposable lands of the public domain.

This Court has recognized in numerous cases the authority of the DENR Secretary to classify agricultural
lands of the public domain as alienable and disposable lands of the public domain. 26 As we declared
in Republic of the Philippines v. Heirs of Fabio,27 "the DENR Secretary is the only other public official
empowered by law to approve a land classification and declare such land as alienable and disposable."

Consequently, as the President's and the DENR Secretary's discretionary power to classify land as
alienable and disposable is merely delegated to them under CA No. 141 and PD No. 705, respectively,
they may not redelegate the same to another office or officer. What has once been delegated by
Congress can no longer be further delegated or redelegated by the original delegate to another, as
expressed in the Latin maxim — Delegata potestas non potest delegari.28 Thus, in Aquino-Sarmiento v.
Morato,29 this Court ruled:

The power to classify motion pictures into categories such as "General Patronage" or "For Adults Only" is
vested with the respondent Board itself and not with the Chairman thereof (Sec. 3 [e], PD 1986). As
Chief Executive Officer, respondent Morato's function as Chairman of the Board calls for the
implementation and execution, not modification or reversal, of the decisions or orders of the latter (Sec.
5 [a], Ibid.). The power of classification having been reposed by law exclusively with the respondent
Board, it has no choice but to exercise the same as mandated by law, i.e., as a collegial body, and not
transfer it elsewhere or discharge said power through the intervening mind of another. Delegata
potestas non potest delegari —a delegated power cannot be delegated. And since the act of
classification involves an exercise of the Board's discretionary power with more reason the Board
cannot, by way of the assailed resolution, delegate said power for it is an established rule in
administrative law that discretionary authority cannot be a subject of delegation. (Emphasis supplied)

Under the 1987 Philippine Constitution, the power to classify agricultural lands of the public domain into
alienable and disposable lands of the public domain is exercised "by law" or through legislative
enactment. In accordance with Section 6 of CA No. 141, this power is delegated to the President who
may, based on his sound discretion, classify agricultural lands as alienable and disposable lands of the
public domain. This delegated power to so classify public agricultural lands may no longer be
redelegated by the President – what has once been delegated may no longer be delegated to another.
Likewise, the same discretionary power has been delegated "by law" to the DENR Secretary who, of
course, cannot redelegate the same to his subordinates.
As it is only the President or the DENR Secretary who may classify as alienable and disposable the lands
of the public domain, an applicant for land registration must prove that the land sought to be registered
has been declared by the President or DENR Secretary as alienable and disposable land of the public
domain. To establish such character, jurisprudence has been clear on what an applicant must submit to
clearly establish that the land forms part of the alienable and disposable lands of the public domain.

In Republic of the Philippines v. T.A.N. Properties, Inc.,30 this Court has held that an applicant must
present a copy of the original classification approved by the DENR Secretary and certified as a true copy
by the legal custodian of the official records. Additionally, a certificate of land classification status issued
by the Community Environment and Natural Resources Office (CENRO) or the Provincial Environment
and Natural Resources Office (PENRO) of the DENR and approved by the DENR Secretary must also be
presented to prove that the land subject of the application for registration is alienable and disposable)
and that it falls within the approved area per verification through survey by the PENRO or
CENRO.31 In Republic of the Philippines v. Roche,32 we clearly stated:

[T]he applicant bears the burden of proving the status of the land. In this connection, the Court has held
that he must present a certificate of land classification status issued by the Community Environment and
Natural Resources Office (CENRO) or the Provincial Environment and Natural Resources Office (PENRO)
of the DENR. He must also prove that the DENR Secretary had approved the land classification and
released the land as alienable and disposable, and that it is within the approved area per verification
through survey by the CENRO or PENRO. Further, the applicant must present a copy of the original
classification approved by the DENR Secretary and certified as true copy by the legal custodian of the
official records. These facts must be established by the applicant to prove that the land is alienable and
disposable.33 (Emphasis supplied)

To repeat, there are two (2) documents which must be presented: first, a copy of the original
classification approved by the Secretary of the DENR and certified as a true copy by the legal custodian
of the official records, and second, a certificate of land classification status issued by the CENRO or the
PENRO based on the land classification approved by the DENR Secretary. The requirement set by this
Court in Republic of the Philippines v. T.A.N Properties, Inc. that both these documents be based on the
land classification approved by the DENR Secretary is not a mere superfluity. This requirement stems
from the fact that the alienable and disposable classification of agricultural land may be made by the
President or DENR Secretary. And while the DENR Secretary may perform this act in the regular course
of business, this does not extend to the CENRO or PENRO – the DENR Secretary may no longer delegate
the power to issue such certification as the power to classify lands of the public domain as alienable and
disposable lands is in itself a delegated power under CA No. 141 and PD No. 705.

Moreover, we have repeatedly stated that a CENRO or PENRO certification is not enough to prove the
alienable and disposable nature of the property sought to be registered because the only way to prove
the classification of the land is through the original classification approved by the DENR Secretary or the
President himself. This Court has clearly held:

Further, it is not enough for the PENRO or CENRO to certify that a land is alienable and disposable. The
applicant for land registration must prove that the DENR Secretary had approved the land
classification and released the land of the public domain as alienable and disposable, and that the land
subject of the application for registration falls within the approved area per verification through survey
by the PENRO or CENRO. In addition, the applicant for land registration must present a copy of the
original classification approved by the DENR Secretary and certified as a true copy by the legal custodian
of the official records. These facts must be established to prove that the land is alienable and disposable.
Respondent failed to do so because the certifications presented by respondent do not, by themselves,
prove that the land is alienable and disposable. 34 (Emphasis supplied)

A CENRO or PENRO certification is insufficient to prove the alienable and disposable nature of the land
sought to be registered it is the original classification by the DENR Secretary or the President which is
essential to prove that the land is indeed alienable and disposable. This has been consistently upheld by
this Court in subsequent land registration cases. Recently, in Republic of the Philippines v.
Nicolas,35 which cited Republic of the Philippines v. Lualhati,36 the Court rejected the attempt of the
applicant to prove the alienable and disposable character of the land through PENRO or CENRO
certifications. The Court held:

[N]one of the documents submitted by respondent to the trial court indicated that the subject property
was agricultural or part of the alienable and disposable lands of the public domain. At most, the CENRO
Report and Certification stated that the land was not covered by any kind of public land application. This
was far from an adequate proof of the classification of the land. In fact, in Republic v. Lualhati, the Court
rejected an attempt to prove the alienability of public land using similar evidence:

Here, respondent failed to establish, by the required evidence, that the land sought to be registered has
been classified as alienable or disposable land of the public domain. The records of this case merely bear
certifications from the DENR-CENRO, Region IV, Antipolo City, stating that no public land application or
land patent covering the subject lots is pending nor are the lots embraced by any administrative title.
Said CENRO certifications, however, do not even make any pronouncement as to the alienable character
of the lands in question for they merely recognize the absence of any pending land patent application,
administrative title, or government project being conducted thereon. But even granting that they
expressly declare that the subject lands form part of the alienable and disposable lands of the public
domain, these certifications remain insufficient for purposes of granting respondent's application for
registration. As constantly held by this Court, it is not enough for the CENRO to certify that a land is
alienable and disposable. The applicant for land registration must prove that the DENR Secretary had
approved the land classification and released the land of the public domain as alienable and
disposable, and that the land subject of the application for registration falls within the approved area
per verification through survey by the PENRO or CENRO. Unfortunately for respondent, the evidence
submitted clearly falls short of the requirements for original registration in order to show the alienable
character of the lands subject herein. (Emphasis supplied)

In this case, Dumo failed to submit any of the documents required to prove that the land she seeks to
register is alienable and disposable land of the public domain.

Response to the Concurring and Dissenting Opinion of Justice Caguioa

The Concurring and Dissenting Opinion of Justice Caguioa suggests that certifications of land
classification status issued by the CENRO and PENRO should be deemed sufficient to prove the alienable
and disposable character of the property if these certifications bear references to the land classification
maps and the original classification issued and signed by the DENR Secretary. This suggestion clearly
undermines the requirements set by this Court in Republic of the Philippines v. T.A.N. Properties,
Inc.37 where the Court expressly stated that it is not enough for the CENRO or PENRO to certify that the
land sought to be registered is alienable and disposable. What is required from the applicant in a land
registration proceeding is to prove that the DENR Secretary had approved the land classification and
released the land of the public domain as alienable and disposable, and that the land subject of the
application for registration falls within the approved area per verification through survey by the PENRO
or CENRO. Quite clearly, the Court definitively stated that to prove that the land is alienable and
disposable, the applicant must present a certified true copy of the original classification approved by the
DENR Secretary or the proclamation made by the President. Only the certified true copy of the original
classification approved by the DENR Secretary or the President will prove to the courts that indeed, the
land sought to be registered is alienable and disposable.

That the certifications of the CENRO or PENRO contain references to the original classification approved
by the DENR Secretary is not enough to prove that the land is alienable and disposable. Mere references
made in the certifications to the classification of land as approved by the DENR Secretary are simply
insufficient. The trial court must be given a certified true copy of the classification made by the DENR
Secretary or the President because it is the only acceptable and sufficient proof of the alienable and
disposable character of the land. In Republic of the Philippines v. T.A.N. Properties, Inc.,38the Court
required the submission of the certified true copy of the land classification approved by the DENR
Secretary precisely because mere references made by the CENRO and PENRO to the land classification
were deemed insufficient. For instance, CENRO and PENRO may inadvertently make references to an
original classification approved by the DENR Secretary which does not cover the land sought to be
registered, or worse, to a non-existent original classification. This is the very evil that the ruling
in Republic of the Philippines v. T.A.N. Properties, Inc.39 seeks to avoid. Justice Caguioa's suggestion
resurrects the very evil banished by this Court in Republic of the Philippines v. T.A.N Properties, Inc. 40

Decisions of this Court form part of the legal system of the Philippines 41 and thus the CENRO, PENRO,
and the DENR must follow the decision made by this Court in Republic of the Philippines v. T.A.N
Properties, Inc.42The ruling of this Court requiring the submission of the certified true copy of the
original classification as approved by the DENR Secretary cannot be overturned or amended by the
CENRO or PENRO or even by the DENR. The DENR, CENRO, and PENRO must follow the law as laid down
by this Court in Republic of the Philippines v. T.A.N. Properties, Inc.43 It is not this Court that should
amend its ruling in Republic of the Philippines v. T.A.N Properties, Inc.44 to conform to the administrative
rules of the DENR, CENRO, or PENRO reversing the final ruling of this Court in Republic of the Philippines
v. T.A.N. Properties, Inc.45 The authority given by the Administrative Order of the DENR to the CENRO
and PENRO to issue certifications of land classification status does not and cannot reverse the clear
requirement laid down by the Court for applicants of land registration to submit the certified true copy
of the original classification approved by the DENR Secretary to prove the alienable and disposable
character of the land.

To repeat, in a judicial confirmation of imperfect title under Section 14(1) of PD No. 1529, the applicant
has the burden of proving that the land sought to be registered is alienable and disposable land of the
public domain. In turn, the best evidence of the alienable and disposable nature of the land is the
certified true copy of the original proclamation made by the President or DENR Secretary, in accordance
with CA No. 141 or PD No. 705. Submitting a mere certification by the CENRO or PENRO with references
to the original classification made by the President or the DENR Secretary is sorely inadequate since it
has no probative value as a public document to prove the alienable and disposable character of the
public land.
Under Section 19, Rule 132 of the Rules of Court, public documents are:

(a) The written official acts, or records of the official acts of the sovereign authority, official bodies and
tribunals, and public officers, whether of the Philippines, or of a foreign country;

(b) Documents acknowledged before a notary public except last wills and testaments; and

(c) Public records, kept in the Philippines, of private documents required by law to be entered therein.

In turn, for the record of public documents referred to in paragraph (a) of Section 19, Rule 132 to be
admissible, it must be evidenced by an official publication thereof or by a copy attested by the officer
having the legal custody of the record, or by his deputy. 46Moreover, to be prima facie evidence of the
facts stated in public documents, such documents must consist of entries in public records made in
the performance of a duty by a public officer. 47 This requirement can be satisfied only if a certified true
copy of the proclamation by the President or the order of the DENR Secretary classifying the land as
alienable and disposable is presented to the trial court.

Quite clearly, certifications by the CENRO or PENRO do not comply with the conditions for admissibility
of evidence. The CENRO or the PENRO is not the official repository or legal custodian of the issuances of
the President or DENR Secretary classifying lands as alienable and disposable lands of the public domain.
Thus, the certifications made by the CENRO or PENRO cannot prove the alienable and disposable
character of the land, which can only be ascertained through the classification made by the President or
DENR Secretary, the only public officials who may classify lands into alienable and disposable lands of
the public domain. The Concurring and Dissenting Opinion alleges that the CENRO serves as a repository
of the land classification maps, and as such, authorizes the CENRO to issue certified true copies of the
approved land classification maps. While the CENRO may issue certified true copies of these land
classification maps, these maps are not the required certified true copy of the original proclamation or
order classifying the public land as alienable and disposable. Moreover, these maps are not in the
possession of the officials who have custody of the original proclamation or order classifying the public
land as alienable and disposable. Again, the best evidence of the alienable and disposable nature of the
land is the certified true copy of the classification made by the President or the DENR Secretary – not the
certified true copy issued by the CENRO of its land classification maps.

It is also worthy to note that in Republic of the Philippines v. T.A.N. Properties, Inc.,48 we have already
discussed the value of certifications issued by the CENRO or PENRO in land registration cases:

The CENRO and Regional Technical Director, FMS-DENR, certifications do not fall within the class of
public documents contemplated in the first sentence of Section 23 of Rule 132. The certifications do not
reflect "entries in public records made in the performance of a duty by a public officer", such as entries
made by the Civil Registrar in the books of registries, or by a ship captain in the ship's logbook. The
certifications are not the certified copies or authenticated reproductions of original official records in
the legal custody of a government office. The certifications are not even records of public documents.
The certifications are conclusions unsupported by adequate proof, and thus have no probative value.
Certainly, the certifications cannot be considered prima facie evidence of the facts stated therein.

The CENRO and Regional Technical Director, FMS-DENR, certifications do not prove that Lot 10705-B
falls within the alienable and disposable land as proclaimed by the DENR Secretary. Such government
certifications do not, by their mere issuance, prove the facts stated therein. Such government
certifications may fall under the class of documents contemplated in the second sentence of Section 23
of Rule 132. As such, the certifications are prima facie evidence of their due execution and date of
issuance but they do not constitute prima facie  evidence of the facts stated therein. 49 (Emphasis
supplied)

The certification issued by the CENRO or PENRO, by itself, does not prove the alienable and disposable
character of the land sought to be registered. The certification should always be accompanied by the
original or certified true copy of the original classification approved by the DENR Secretary or the
President.

Substantial Compliance with the Requirements of Section 14(1)

Dumo argues that the Certification from the Regional Surveys Division, which was formally offered as
Exhibit "A" and not opposed by the Republic, should be considered substantial compliance with the
requirement that the applicant must submit the certified true copy of the original classification of the
land as approved by the DENR Secretary.

We do not agree.

The fact that the Republic did not oppose the formal offer of evidence of Dumo in the RTC does not have
the effect of proving or impliedly admitting that the land is alienable and disposable. The alienable and
disposable character of the land must be proven by clear and incontrovertible evidence. It may not be
impliedly admitted, as Dumo vehemently argues. It was the duty of Dumo to prove that the land she
sought to register is alienable and disposable land of the public domain. This burden would have been
discharged by submitting the required documents – a copy of the original classification approved by the
DENR Secretary and certified as a true copy by the legal custodian thereof, and a certificate of land
classification status issued by the CENRO or the PENRO based on the approved land classification by the
DENR Secretary. Without these, the applicant simply fails to prove that the land sought to be registered
forms part of the alienable and disposable lands of the public domain and thus, it may not be
susceptible to private ownership. As correctly pointed out by the CA, the land is presumed to belong to
the State as part of the public domain.

Another requirement under Section 14(1) of PD No. 1529 is to prove that the applicant and her
predecessors-in-interest have been in open, continuous, exclusive, and notorious possession and
occupation of the land under a bonafide claim of ownership since 12 June 1945 or earlier.

In this case, the CA found that Dumo and her predecessors-in-interest have been in possession of the
land only from 1948, which is the earliest date of the tax declaration presented by Dumo. This fact is
expressly admitted by Dumo. Thus, from this admission alone, it is clear that she failed to prove her and
her predecessors-in-interest's possession and occupation of the land for the duration required by law —
from 12 June 1945 or earlier.

Dumo, however, argues that it does not matter that her possession dates only back to 1948 because this
Court has allegedly stated that even if the possession or occupation started after 12 June 1945, this does
not bar the grant of an application for registration of land.

Again, we do not agree with Dumo.

To determine whether possession or occupation from 12 June 1945 or earlier is material, one has to
distinguish if the application for the registration of land is being made under paragraph 1 or paragraph 2
of Section 14 of PD No. 1529. The relevant paragraphs provide:

Section 14. Who may apply. The following persons may file in the proper Court of First Instance an
application for registration of title to land, whether personally or through their duly authorized
representatives:

(1) Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of alienable and disposable lands of the public
domain under a bona fide claim of ownership since June 12, 1945, or earlier.

(2) Those who have acquired ownership of private lands by prescription under the provision of existing
laws.

xxxx

Thus, it is clear that if the applicant is applying for the registration of land under paragraph 1, possession
and occupation of the alienable and disposable land of the public domain under a bona fide claim of
ownership should have commenced from 12 June 1945 or earlier. If, however, the applicant is relying on
the second paragraph of Section 14 to register the land, then it is true that a different set of
requirements applies, and possession and occupation from 12 June 1945 or earlier are not required.

The reliance of Dumo on Republic of the Philippines v. Court of Appeals 50 is misplaced. The
pronouncement of the Court in relation to the phrase "June 12, 1945 or earlier" was that the alienable
and disposable classification of the land need not be from 12 June 1945 or earlier, and that as long as
such land is classified as alienable and disposable when the application is filed, then the first
requirement under the law is fulfilled. The Court held:

Petitioner suggests an interpretation that the alienable and disposable character of the land should have
already been established since June 12, 1945 or earlier. This is not borne out by the plain meaning of
Section 14(1). "Since June 12, 1945," as used in the provision, qualifies its antecedent phrase "under
a bona fide claim of ownership." Generally speaking, qualifying words restrict or modify only the words
or phrases to which they are immediately associated, and not those distantly or remotely located. Ad
proximum antecedents fiat relation nisi impediatur sentencia.

Besides, we are mindful of the absurdity that would result if we adopt petitioner's position. Absent a
legislative amendment, the rule would be, adopting the OSG's view, that all lands of the public domain
which were not declared alienable or disposable before June 12, 1945 would not be susceptible to
original registration, no matter the length of unchallenged possession by the occupant. Such
interpretation renders paragraph (1) of Section 14 virtually inoperative and even precludes the
government from giving it effect even as it decides to reclassify public agricultural lands as alienable and
disposable. The unreasonableness of the situation would even be aggravated considering that before
June 12, 1945, the Philippines was not yet even considered an independent state.

Instead, the more reasonable interpretation of Section 14(1) is that it merely requires the property
sought to be registered as already alienable and disposable at the time the application for registration of
title is filed. If the State, at the time the application is made, has not yet deemed it proper to release the
property for alienation or disposition, the presumption is that the government is still reserving the right
to utilize the property; hence, the need to preserve its ownership in the State irrespective of the length
of adverse possession even if in good faith. However, if the property has already been classified as
alienable and disposable, as it is in this case, then there is already an intention on the part of the State
to abdicate its exclusive prerogative over the property. 51

Thus, it did not state that the possession and occupation from 12 June 1945 or earlier are no longer
required. It merely clarified when the land should have been classified as alienable and disposable to
meet the requirements of Section 14(1) of PD No. 1529. The property sought to be registered must be
declared alienable and disposable at the time of the filing of the application for registration. 52 This does
not require that the land be declared alienable and disposable from 12 June 1945 or earlier.

Registration of land under Section 14(2)

Dumo also argues that she has the right to register the land because she and her predecessors-in-
interest have already acquired the land through prescription. She states that she and her predecessors-
in-interest have been in possession and occupation of the land for fifty-six (56) years, and thus she has
already acquired ownership of the land by prescription.

Again, we disagree.

It is true that under Section 14 of PD No. 1529, one may acquire ownership of the land by prescription.
Particularly, paragraph 2 of Section 14 provides that "those who have acquired ownership of private
lands by prescription under the provision of existing laws" may file an application for registration of title
to land. The existing law mentioned in PD No. 1529 is the Civil Code of the Philippines. In Heirs of
Malabanan v. Republic of the Philippines,53 we applied the civil law concept of prescription as embodied
in the Civil Code to interpret Section 14(2) of PD No. 1529. This Court held:

The second source is Section 14(2) of P.D. 1529 itself, at least by implication, as it applies the rules on
prescription under the Civil Code, particularly Article 1113 in relation to Article 1137. Note that there
are two kinds of prescription under the Civil Code – ordinary acquisitive prescription and extraordinary
acquisitive prescription, which, under Article 1137, is completed "through uninterrupted adverse
possession... for thirty years, without need of title or of good faith." 54 (Boldfacing and underscoring
supplied)

Section 14(2) of PD No. 1529 puts into operation the entire regime of prescription under the Civil Code,
particularly Article 1113 in relation to Article 1137. 55 Article 1113 provides that "[p]roperty of the State
or any of its subdivisions not patrimonial in character shall not be the object of prescription." Thus, it is
clear that the land must be patrimonial before it may be susceptible of acquisitive prescription. Indeed,
Section 14(2) of PD No. 1529 provides that one may acquire ownership of private lands by prescription.

Land of the public domain is converted into patrimonial property when there is an express declaration
by the State that the public dominion property is no longer intended for public service or the
development of the national wealth.56 Without such declaration, acquisitive prescription does not start
to run, even if such land is alienable and disposable and the applicant is in possession and occupation
thereof. We have held:
Accordingly, there must be an express declaration by the State that the public dominion property is no
longer intended for public service or the development of the national wealth or that the property has
been converted into patrimonial. Without such express declaration, the property, even if classified as
alienable or disposable, remains property of the public dominion, pursuant to Article 420(2), and thus
incapable of acquisition by prescription. It is only when such alienable and disposable lands are expressly
declared by the State to be no longer intended for public service or for the development of the national
wealth that the period of acquisitive prescription can begin to run. Such declaration shall be in the form
of a law duly enacted by Congress or a Presidential Proclamation in cases where the President is duly
authorized by law.57

Mere classification of agricultural land as alienable and disposable does not make such land patrimonial
property of the State – an express declaration by the State that such land is no longer intended for
public use, public service or the development of national wealth is imperative. This is because even with
such classification, the land remains to be part of the lands of the public domain. In Navy Officers'
Village Association, Inc. v. Republic of the Philippines,58 we stated:

Lands of the public domain classified as reservations for public or quasi-public uses are non-alienable
and shall not be subject to disposition, although they are, by the general classification under Section 6
of C.A. No. 141, alienable and disposable lands of the public domain, until declared open for
disposition by proclamation of the President. (Emphasis supplied)

Under CA No. 141, the power given to the President to classify lands as alienable and disposable extends
only to  lands of the public domain. Lands of the public domain are public lands intended for public use,
or without being for public use, are intended for some public service or for the development of national
wealth. Lands of the public domain, like alienable or disposable lands of the public domain, are not
private lands. Article 420 of the Civil Code provides:

Art. 420. The following things are property of public dominion:

(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed
by the State, banks, shores, roadsteads, and others of similar character;

(2) Those which belong to the State, without being for public use, and are intended for some public
service or for the development of the national wealth.

Classifying lands as alienable and disposable does not take away from the fact that these lands still
belong to the public domain. These lands belonged to the public domain before they were classified as
alienable and disposable and they still remain to be lands of the public domain after such
classification. In fact, these lands are classified in Section 3, Article XII of the 1987 Philippine
Constitution as "[a]lienable lands of the public domain." The alienable and disposable character of the
land merely gives the State the authority to alienate and dispose of such land if it deems that the land is
no longer needed for public use, public service or the development of national wealth.

Alienable and disposable lands of the public domain are those that are to be disposed of to private
individuals by sale or application, because their disposition to private individuals is for the development
of the national wealth. Thus, homesteads, which are granted to individuals from alienable and
disposable lands of the public domain, are for the development of agriculture which would redound to
the development of national wealth. However, until the lands are alienated or disposed of to private
individuals, they remain "alienable lands of the public domain," as expressly classified by the 1987
Philippine Constitution.

Lands of the public domain become patrimonial property only when they are no longer intended for
public use or public service or the development of national wealth. Articles 421 and 422 of the Civil Code
expressly provide:

Article 421. All other property of the State, which is not of the character stated in the preceding article,
is patrimonial property

Article 422. Property of public dominion, when no longer intended for public use or for public service,
shall form part of the patrimonial property of the State.

In turn, the intention that the property is no longer needed for public use, public service or the
development of national wealth may only be ascertained through an express declaration by the State.
We have clearly held:

Accordingly, there must be an express declaration by the State that the public dominion property is no
longer intended for public service or the development of the national wealth or that the property has
been converted into patrimonial. Without such express declaration, the property, even if classified as
alienable or disposable, remains property of the public dominion, pursuant to Article 420(2), and thus
incapable of acquisition by prescription. It is only when such alienable and disposable lands are
expressly declared by the State to be no longer intended for public service or for the development of the
national wealth that the period of acquisitive prescription can begin to run. Such declaration shall be in
the form of a law duly enacted by Congress or a Presidential Proclamation in cases where the President
is duly authorized by law.59 (Emphasis supplied)

Without an express declaration that the land is no longer needed for public use, public service or the
development of national wealth, it should be presumed that the lands of the public domain, whether
alienable and disposable or not, remain belonging to the State under the Regalian Doctrine. We have
already recognized that the classification of land as alienable and disposable does not make such
property patrimonial. In Dream Village Neighborhood Association, Inc. v. Bases Conversion Development
Authority,60 the Court held:

One question laid before us is whether the area occupied by Dream Village is susceptible of acquisition
by prescription. In Heirs of Mario Malabanan v. Republic, it was pointed out that from the moment R.A.
No. 7227 was enacted, the subject military lands in Metro Manila became alienable and disposable.
However, it was also clarified that the said lands did not thereby become patrimonial, since the BCDA
law makes the express reservation that they are to be sold in order to raise funds for the conversion of
the former American bases in Clark and Subic. The Court noted that the purpose of the law can be tied
to either "public service" or "the development of national wealth" under Article 420(2) of the Civil Code,
such that the lands remain property of the public dominion, albeit their status is now alienable and
disposable. The Court then explained that it is only upon their sale to a private person or entity as
authorized by the BCDA law that they become private property and cease to be property of the public
dominion:
For as long as the property belongs to the State, although already classified as alienable or disposable,
it remains property of the public dominion if x x x it is "intended for some public service or for the
development of the national wealth."

Thus, under Article 422 of the Civil Code, public domain lands become patrimonial property only if there
is a declaration that these are alienable or disposable, together with an express government
manifestation that the property is already patrimonial or no longer retained for public service or the
development of national wealth. x x x. (Emphasis supplied)

The alienable and disposable character of public agricultural land does not convert the land to
patrimonial property. It merely gives the State the authority to alienate or dispose the agricultural land,
in accordance with law. It is only when (1) there is an express government manifestation that the land is
already patrimonial or no longer intended for public use, public service or the development of national
wealth, or (2) land which has been classified as alienable and disposable land is actually alienated and
disposed of by the State, that such land becomes patrimonial.

In the present case, Dumo not only failed to prove that the land sought to be registered is alienable and
disposable, but also utterly failed to submit any evidence to establish that such land has been converted
into patrimonial property by an express declaration by the State. To repeat, acquisitive prescription only
applies to private lands as expressly provided in Article 1113 of the Civil Code. To register land acquired
by prescription under PD No. 1529 (in relation to the Civil Code of the Philippines), the applicant must
prove that the land is not merely alienable and disposable, but that it has also been converted into
patrimonial property of the State. Prescription will start to run only from the time the land has become
patrimonial.61 Unless the alienable and disposable land of the public domain is expressly converted into
patrimonial property, there is no way for acquisitive prescription to set in under Article 1113 of the Civil
Code.

However, another mode of prescription specifically governs the acquisitive prescription of alienable and
disposable lands of the public domain. CA No. 141 provides for the modes of disposing alienable and
disposable agricultural lands of the public domain:

Section 11. Public lands suitable for agricultural purposes can be disposed of only as follows, and not
otherwise:

(1) For homestead settlement;

(2) By sale;

(3) By lease; and

(4) By confirmation of imperfect or incomplete titles:

(a) By judicial legalization; or

(b) By administrative legalization (free patent). (Emphasis supplied)

In turn, Section 48 of the same law provides for those who may apply for confirmation of their imperfect
or incomplete title by judicial application:

Section 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:

xxxx

(b) Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive, and notorious possession and occupation of alienable and disposable lands of the public
domain, under a bona fide claim of acquisition of ownership, since June 12, 1945, or earlier,
immediately preceding the filing of the applications 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. (Emphasis supplied)

It is clear from the foregoing provisions that for lands of the public domain, one may apply for an
administrative grant from the government, through homestead, sale, lease or free patent, or apply for
the confirmation of their title in accordance with the conditions provided under Section 48(b) of CA No.
141. PD No. 1529 provides for the original registration procedure for the judicial confirmation of an
imperfect or incomplete title. It must also be noted that the wording in Section 48(b) of CA No. 141 is
similar to that found in Section 14(1) of PD No. 1529. The similarity in wording has already been
explained by this Court when it recognized that Section 14(1) of PD No. 1529 works in relation to Section
48(b) of CA No. 141 in the registration of alienable and disposable lands of the public domain:

It is clear that Section 48 of the Public Land Act is more descriptive of the nature of the right enjoyed by
the possessor than Section 14 of the Property Registration Decree, which seems to presume the pre-
existence of the right, rather than establishing the right itself for the first time. It is proper to assert that
it is the Public Land Act, as amended by P.D. No. 1073 effective 25 January 1977, that has primarily
established the right of a Filipino citizen who has been in "open, continuous, exclusive, and notorious
possession and occupation of alienable and disposable lands of the public domain, under a bona
fide claim of acquisition of ownership, since June 12, 1945" to perfect or complete his title by applying
with the proper court for the confirmation of his ownership claim and the issuance of the corresponding
certificate of title.

Section 48 can be viewed in conjunction with the afore-quoted Section 11 of the Public Land Act, which
provides that public lands suitable for agricultural purposes may be disposed of by confirmation of
imperfect or incomplete titles, and given the notion that both provisions declare that it is indeed the
Public Land Act that primarily establishes the substantive ownership of the possessor who has been in
possession of the property since 12 June 1945. In turn, Section 14(a) of the Property Registration
Decree recognizes the substantive right granted under Section 48(b) of the Public Land Act, as well as
provides the corresponding original registration procedure for the judicial confirmation of an
imperfect or incomplete title.62 (Emphasis supplied)
Thus, the applicant for registration of the alienable and disposable land of the public domain claims his
right to register the land under Section 48(b) of CA No. 141 and the procedure for registration is found
under Section 14(1) of PD No. 1529 which provides that "those who by themselves or through their
predecessors-in-interest have been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain under a bona fide claim of
ownership since June 12, 1945, or earlier" may file in the proper court their application for land
registration. The basis for application of judicial confirmation of title over alienable and disposable land
of the public domain is not acquisitive prescription under the Civil Code, but rather, the fulfillment of the
requirements under Section 48(b) of CA No. 141.

To summarize the discussion and reiterate the guidelines set by this Court in Heirs of Malabanan v.
Republic of the Philippines,63 we state:

1. If the applicant or his predecessors-in-interest have been in open, continuous, exclusive and notorious
possession and occupation of the land sought to be registered under a bona fide claim of
ownership since 12 June 1945 or earlier, the applicant must prove that the land has been classified by
the Executive department as alienable and disposable land of the public domain. This is covered by
Section 14(1) of PD No. 1529 in relation to Section 48(b) of CA No. 141.

While it is not necessary that the land has been alienable and disposable since 12 June 1945 or earlier,
the applicant must prove that the President or DENR Secretary has classified the land as alienable and
disposable land of the public domain at any time before the application was made.

2. If the occupation and possession of the land commenced at any time after 12 June 1945, the applicant
may still register the land if he or his predecessors-in-interest have complied with the requirements
of acquisitive prescription under the Civil Code after the land has been expressly declared
as patrimonial property or no longer needed for public use, public service or the development of
national wealth. This is governed by Section 14(2) of PD No. 1529 in relation to the Civil Code.

Under the Civil Code, acquisitive prescription, whether ordinary or extraordinary, applies only to private
property. Thus, the applicant must prove when the land sought to be registered was expressly
declared as patrimonial property because it is only from this time that the period for acquisitive
prescription would start to run.

Based on the foregoing, we find that the CA committed no reversible error in finding that Dumo had no
registerable title over the land she seeks to register. She failed to prove her right under either Section
14(1) or Section 14(2) of PD No. 1529. She failed to prove that the land she seeks to register was
alienable and disposable land of the public domain. She failed to prove her and her predecessors-in-
interest's possession and occupation since 12 June 1945 or earlier. Thus, she has no right under Section
14(1) of PD No. 1529. While she argues that she and her predecessors-in-interest have been in
possession and occupation of the land for 56 years, she failed to prove that the land has been expressly
declared as patrimonial property. Therefore, she also has no right under Section 14(2) of PD No. 1529.

WHEREFORE, the petition is DENIED. The assailed decision and resolution of the Court of Appeals
are AFFIRMED.

SO ORDERED.
SECOND DIVISION

[ G.R. No. 217703, October 09, 2019 ]

REPUBLIC OF THE PHILIPPINES, AS REPRESENTED BY THE REGIONAL DIRECTOR DEPARTMENT OF

EDUCATION, CULTURE AND SPORTS (DECS)- REGION II, PETITIONER, V. SEVERO ABARCA, NILO
ABARCA, PERSEUS ABARCA, JUVY ABARCA MALANA AND AGNES ABARCA BALMACEDA,
RESPONDENTS.

DECISION

J. REYES, JR., J.:

Assailed in this Petition for Review on Certiorari is the March 12, 2015 Decision[1] of the Court of
Appeals (CA) in CA-G.R. CV No. 100280 which reversed and set aside the January 2, 2013 Decision[2] of
the Regional Trial Court, Ilagan, Isabela, Branch 18 (RTC) in Civil Case No. 995, a case for recovery of
possession with damages.

The Antecedents

Republic of the Philippines (petitioner) averred that it is the owner of a parcel of land situated in
Alibagu, Ilagan, Isabela covering an area of 21,646 square meters, denominated as Lot 1, TS 1028. Since
the 1960s, the Alibagu Elementary School (AES) has been occupying and using the said property as a
school site. In January 1983, Severo Abarca (Severo) was allowed by the Principal of AES and President
of the school's Parents-Teachers Association (PTA) to lease a one-hectare portion of the property for a
period of 10 years starting January 8, 1983. In return, Severo paid the amount of P200.00 per year to be
used for the improvement of the school. However, after the expiration of the ten-year period and
despite several demands, Severo and his children, the other respondents, refused to vacate and
continued to occupy the portion leased to him (subject property) as they had already erected their
respective houses thereon.[3]

In their Answer, the respondents denied petitioner's claim of ownership and possession of the subject
property. They admitted that in January 1983, Severo leased a portion of the school site for a period of
10 years, but the same was already returned to AES in 1993. The respondents contended that the
portion occupied by them is outside the school site and that they have been in possession thereof since
1970.[4]

The RTC Ruling

In its January 2, 2013 Decision, the RTC ruled that petitioner is the undisputed owner of Lot 1, TS 1028
which was surveyed on October 28, 1965 under Cadastral No. 403 and approved on March 3, 1986, for
the purpose of allocating the same as a school site for the beneficial use of AES. It held that the said lot
is a public land as it is untitled and not covered by a Presidential Proclamation as attested by Manuel
Caurel, Land Management Officer III of the Department of Environment and Natural Resources (DENR).

The trial court added that as public land, petitioner is the absolute owner of the said parcel of land
under the Regalian doctrine. It noted that Court-appointed Commissioners Cesar S. Ponce
(Commissioner Ponce) and Pedro Santa Cruz, Jr. (Commissioner Santa Cruz) both conducted relocation
surveys on Lot 1, TS 1028 and found that the area occupied by the respondents is within the school site.
The fallo reads:

WHEREFORE, in the light of all the foregoing discussions, it is hereby ordered that:

1. All the defendants must vacate the leased premises described in Exhibits "E-3." "1-A" & "1-B" of the
plaintiff's property (Lot 1. Ts- 1028) located at Alibagu Elementary School, Alibagu, Ilagan, Isabela; and
remove all houses and other improvements that are still found therein;

2. All the defendants must pay individually to the plaintiff the sum of P500.00 monthly by way of rental
reckoned from the date of the filing of the Complaint on July 14, 1997 until they vacate the said leased
premises and remove all improvements found therein; and,

3. To pay collectively litigation expenses of P25,000.00 in favor of the plaintiff.

SO ORDERED.[5]

Aggrieved, the respondents elevated an appeal before the CA.

The CA Ruling

In its March 12, 2015 Decision, the CA reversed and set aside the RTC ruling. It opined that the ruling in
Republic v. Estonilo[6] states that a Presidential Proclamation is required for the reservation of a piece of
land for a public purpose, which proclamation petitioner failed to produce. The appellate court adjudged
that for an action for recovery of possession to prosper, it is indispensable that he who brings the action
fully proves not only his ownership but also the identity of the property claimed. It noted that petitioner
could not identify the exact location and boundaries of the portion leased to Severo. Moreover, the CA
declared that petitioner's denial of the respondents' return of the leased property, absent convincing
evidence, could not trump the claim that the same had been returned because positive statement is
stronger and has greater evidentiary weight than negative evidence. Hence, it concluded that petitioner
failed to present proof of its ownership over the land it sought to recover. The CA disposed the case in
this wise:

WHEREFORE, premises considered, the appeal is GRANTED. The Decision dated January 2, 2013 of the
Regional Trial Court, Branch 18 of Ilagan, Isabela, in Civil Case No. 995 is REVERSED and SET ASIDE. The
complaint is DISMISSED.

SO ORDERED.[7]

Hence, this Petition for Review on Certiorari.

The Issue

WHETHER PETITIONER HAS A BETTER RIGHT OF POSSESSION OVER THE SUBJECT PROPERTY.
Petitioner argues that the subject property belongs to the State pursuant to the Regalian doctrine; that
respondents themselves admitted that they applied for issuance of a sales patent over a portion of Lot
1, TS 1028; that by making said application, the respondents admitted that they do not own the subject
property and they acknowledged that the same belongs to the Government; that contrary to the CA's
view, it sufficiently identified the property it seeks to recover from the respondents, i.e., the parcel of
land upon which the respondents built their houses and which forms part of the one-hectare land they
previously leased from AES; that the testimonies of petitioner's witnesses and the survey reports
submitted by the Geodetic Engineers commissioned by the trial court prove that the land which the
respondents presently occupy is a portion of the parcel of land that was the subject matter of the lease
contract between the school officials of AES and Severo in 1983; and that the land occupied by the
respondents is part of Lot 1, TS 1028 which is reserved as a school site to be used for public education
purposes.[8]

In their Comment,[9] the respondents counter that there is no proclamation reserving Lot 1, TS 1028 for
use as a school site; that petitioner could not identify the actual area and boundaries of the lot leased to
them; that Manuel Caurel, a DENR officer, testified that the subject property is alienable and disposable;
and that petitioner has the burden of proof in proving that it is the owner of the subject property.

The Court's Ruling

The petition is meritorious.

Land, which is an immovable property, may be classified as either of public dominion or of private
ownership.[10] Land is considered of public dominion if it is either: (a) intended for public use; or (b)
belongs to the State, without being for public use, and is intended for some public service or for the
development of the national wealth.[11]

Land belonging to the State that is not of such character, or although of such character but no longer
intended for public use or for public service forms part of the patrimonial property of the State.[12]
Land that is other than part of the patrimonial property of the State, provinces, cities and municipalities
is of private ownership if it belongs to a private individual.

The Regalian doctrine, embodied in Section 2, Article XII of the 1987 Constitution, provides that all lands
of the public domain belong to the State. This means that the State is the source of any asserted right to
ownership of land, and is charged with the conservation of such patrimony.[13] All lands not appearing
to be clearly under private ownership are presumed to belong to the State. Also, public lands remain
part of the inalienable land of the public domain unless the State is shown to have reclassified or
alienated them to private persons.[14] Matters of land classification or reclassification cannot be
assumed; they call for proof.[15] And the applicant or the person claiming ownership bears the burden
to overturn, by incontrovertible evidence, the presumption that the land subject of an application for
registration or claim of ownership is alienable and disposable.[16]

Thus, the Court declared in Valiao v. Republic:[17]

Under the Regalian doctrine, which is embodied in our Constitution, all lands of the public domain
belong to the State, which is the source of any asserted right to any ownership of land. All lands not
appearing to be clearly within private ownership are presumed to belong to the State.
Accordingly, public lands not shown to have been reclassified or released as alienable agricultural land
or alienated to a private person by the State remain part of the inalienable public domain. Unless public
land is shown to have been reclassified as alienable or disposable to a private person by the

State, it remains part of the inalienable public domain. Property of the public domain is beyond the
commerce of man and not susceptible of private appropriation and acquisitive prescription. Occupation
thereof in the concept of owner no matter how long cannot ripen into ownership and be registered as a
title.

The burden of proof in overcoming the presumption of State ownership of the lands of the public
domain is on the person applying for registration (or claiming ownership), who must prove that the
land subject of the application is alienable or disposable. To overcome this presumption,
incontrovertible evidence must be established that the land subject of the application (or claim) is
alienable or disposable.

There must be a positive act declaring land of the public domain as alienable and disposable. To prove
that the land subject of an application for registration is alienable, the applicant must establish the
existence of a positive act of the government, such as a presidential proclamation or an executive order;
an administrative action; investigation reports of Bureau of Lands investigators; and a legislative act or a
statute.

The applicant may also secure a certification from the government that the land claimed to have been
possessed for the required number of years is alienable and disposable.[18] (Emphases supplied and
citations omitted)

Further, in Secretary of the DENR v. Yap,[19] the Court has already settled that the person applying for
registration or claiming ownership of a parcel of land must prove that the same has already been
declared alienable and disposable, viz.:

A positive act declaring land as alienable and disposable is required.

In keeping with the presumption of State ownership, the Court has time and again emphasized that
there must be a positive act of the government, such as an official proclamation, declassifying
inalienable public land into disposable land for agricultural or other purposes. In fact,

Section 8 of CA No. 141 limits alienable or disposable lands only to those lands which have been
Promulgated: officially delimited and classified. Promulgated:

The burden of proof in overcoming the presumption of State ownership of the lands of the public
domain is on the person applying for registration (or claiming ownership), who must prove that the land
subject of the application is alienable or disposable. To overcome this presumption, incontrovertible
evidence must be established that the land subject of the application (or claim) is alienable or
disposable. There must still be a positive act declaring land of the public domain as alienable and
disposable.

To prove that the land subject of an application for registration is alienable, the applicant must establish
the existence of a positive act of the government such as a presidential proclamation or an executive
order; an administrative action; investigation reports of Bureau of Lands investigators; and a legislative
act or a statute. The applicant may also secure a certification from the government that the land claimed
to have been possessed for the required number of years is alienable and

disposable.[20] (Emphases in the original and citations omitted)

First and foremost, let it be emphasized that the respondents did not deny the State's ownership of the
subject property. They admitted that they leased a one-hectare portion of the school site. They,
however, contend that they already returned the leased portion. The Court-appointed Commissioners,
however, declared that the land upon which the respondents built their houses is located within Lot 1. If
in fact, their predecessor-in-interest had been in possession of the subject property since 1970, then
why did they lease the same from AES? In addition, the respondents failed to adduce any evidence to
support their claim that their predecessor-in-interest had been in possession of the subject property
since 1970. They could not even present tax declarations in their name. The Director, Lands
Management Bureau v. CA[21] held thus:

Tax receipts and tax declarations are not incontrovertible evidence of ownership. They are mere indicia
of [a] claim of ownership. In Director of Lands vs. Santiago:

. . . [I]f it is true that the original owner and possessor, Generosa Santiago, had been in possession since
1925, why were the subject lands declared for taxation purposes for the first time only in 1968, and in
the names of Garcia and Obdin?

For although tax receipts and declarations of ownership for taxation purposes are not incontrovertible
evidence of ownership, they constitute at least proof that the holder had a claim of title over the
property.[22]

Finally, the respondents cite the case of Republic v. Estonilo[23] (Estonilo) to support their claim. In
Estonilo, however, the issue is whether a petition for reservation or a court judgment is necessary to
make Proclamation 265 specifically reserving Lot 4318 for the use of the Philippine Army effective. Thus,
the Court ruled that under the Public

Land Act, only a positive act of the President is needed to segregate a piece of land for a public purpose.
It must be noted that while Section 53 grants authority to the director of lands — through the solicitor
general — to file a petition against claimants of the reserved land, the filing of that petition is not
mandatory. The director of lands is required to file a petition only: "whenever in the opinion of the
President public interest requires it."[24] Nowhere in the said decision did the Court declare that a
proclamation is required to prove the Republic's ownership of a public land. The burden of proof in
overcoming the presumption of State ownership of the lands of the public domain is on the person
claiming ownership.

WHEREFORE, premises considered, the petition is hereby GRANTED. The Court of

Appeals March 12, 2015 Decision in CA-G.R. CV No. 100280 is REVERSED and SET ASIDE. SO ORDERED.