Civil Law, Remedial Law

REPUBLIC v. Mendoza G.R. No. 185091 August 8, 2010 Torrens System, Expropriation, Just Compensation

FACTS:

Paninsingin Primary School (PPS) is a public school in Lipa, Batangas, operated by petitioner Republic of the Philippines through the Department of Education. 

PPS has been occupying  a portion of Lots 1923 and 1925, registered in the name of respondents Primo and Maria Mendoza under TCT T-11410.

The Mendozas caused said lots to be consolidated and subdivided into four lots.

Hence, the Register of Deeds partially cancelled TCT T-11410 and issued new titles in favor of the new owners. Meantime, PPS remained in possession of the property.

The Republic claimed that, while no title was issued in the name of the City Government of Lipa, the Mendozas had relinquished to it their right over the school lot.

The Mendozas claimed that they never relinquished their right to it. They allowed PPS to occupy the property since they had no need for it at that time. Thus, it has remained registered in their name under the original title, TCT T-11410, which had only been partially cancelled.

The Mendozas filed a complaint for unlawful detainer against PPS when it declined their demand to vacate the disputed property.

The MTCC dismissed the complaint on ground of the Republic’s immunity from suit. 

On appeal to the RTC, it ruled that the Republic’s consent was not necessary since the action before the MTCC was not against it.

The RTC remanded the case back to the MTCC, which then dismissed the case for insufficiency of evidence. 

On appeal, the RTC found in favor of the Mendozas and ordered PPS to vacate the property. It held that the Mendozas had the better right of possession since they were its registered owners. PPS, on the other hand, could not produce any document to prove the transfer of ownership of the land in its favor. 

PPS moved for reconsideration, but the RTC denied it.

The Republic, through the OSG, appealed the RTC decision to the CA. The CA affirmed the RTC decision. Upholding the Torrens system, it emphasized the indefeasibility of the Mendozas’ registered title and the imprescriptible nature of their right to eject any person occupying the property. 

The CA held that, this being the case, the Republic’s possession of the property through PPS should be deemed merely a tolerated one that could not ripen into ownership.

The CA also rejected the Republic’s claim of ownership since it presented no documentary evidence to prove the transfer of the property in favor of the government. Moreover, even assuming that the Mendozas relinquished their right to the property in 1957 in the government’s favor, the latter never took steps to have the title to the property issued in its name or have its right as owner annotated on the Mendozas’ title. 

The CA held that, by its omissions, the Republic may be held in estoppel to claim that the Mendozas were barred by laches from bringing its action.

With the denial of its motion for reconsideration, the Republic has taken recourse to this Court via petition for review on certiorari under Rule 45.

ISSUE:

Whether or not the filing of an ejectment suit was the proper remedy against the Government for its failure to acquire ownership of a privately owned property that it had long used.

RULING:

A decree of registration is conclusive upon all persons, including the Government of the Republic and all its branches, whether or not mentioned by name in the application for registration or its notice. Indeed, title to the land, once registered, is imprescriptible. No one may acquire it from the registered owner by adverse, open, and notorious possession. Thus, to a registered owner under the Torrens system, the right to recover possession of the registered property is equally imprescriptible since possession is a mere consequence of ownership.

Here, the existence and genuineness of the Mendozas’ title over the property has not been disputed. The Republic itself admits that no new title was issued to it or to any of its subdivisions for the portion that PPS had been occupying since 1957.

The CA erred, however, in ordering the eviction of PPS from the property that it had held as a government school site for more than 50 years. The evidence on record shows that the Mendozas intended to cede the property to the City Government of Lipa permanently. In fact, they allowed the city to declare the property in its name for tax purposes.

The Court holds that, where the owner agrees voluntarily to the taking of his property by the government for public use, he thereby waives his right to the institution of a formal expropriation proceeding covering such property. 

Further, as the Court also held in Eusebio v. Luis, the failure for a long time of the owner to question the lack of expropriation proceedings covering a property that the government had taken constitutes a waiver of his right to gain back possession. The Mendozas’ remedy is an action for the payment of just compensation, not ejectment.

In Republic v. CA, the Court affirmed the RTC’s power to award just compensation even in the absence of a proper expropriation proceeding. It held that the RTC can determine just compensation based on the evidence presented before it in an ordinary civil action for recovery of possession of property or its value and damages. 

As to the time when just compensation should be fixed, it is settled that where property was taken without the benefit of expropriation proceedings and its owner filed an action for recovery of possession before the commencement of expropriation proceedings, it is the value of the property at the time of taking that is controlling.

Since the MTCC did not have jurisdiction either to evict the Republic from the land it had taken for public use or to hear and adjudicate the Mendozas’ right to just compensation for it, the CA should have ordered the complaint for unlawful detainer dismissed without prejudice to their filing a proper action for recovery of such compensation.

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