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Prohibition on Corporations/Associations Private corporations or associations may not hold such

alienable lands of the public domain except by lease, for a period not exceeding twenty years, renewable for not more than twenty-five years, and not to exceed one thousand hectares in area. Citizens of the Philippines may lease not more than five hundred hectares, or acquire not more than twelve hectares thereof by purchase, homestead, or grant. Taking into account the requirements of conservation, ecology, and development, and subject to the requirements of agrarian reform, the Congress shall determine, by law, the size of the lands of the public domain which may be acquired, developed, held or leased and the conditions therefore. (Sec. 3, Art. XII, Constitution).

The 1987 Constitution continues the State policy in the 1973 Constitution banning private corporations from acquiring any kind of alienable land of the public domain. Like the 1973 Constitution, the 1987 Constitution allows private corporations to hold alienable lands of the public domain only through lease. As in the 1935 and 1973 Constitutions, corporations of the general law governing the lease to private

reclaimed,

foreshore and marshy alienable lands of

the public domain is still CA No. 141 or the Public Land Act. In Ayog vs. Cusi 118 SCRA 492, the Court explained the

rationale behind this Constitutional ban in this way:

Indeed, one purpose of the constitutional prohibition against purchases of public agricultural lands by private corporations is to equitably diffuse land ownership or to encourage owner-cultivatorship and the economic family-size farm and to prevent a recurrence of cases like the instant case. Huge landholdings by corporations or private persons had spawned social unrest.

However,

if

the

constitutional

intent

is

to

prevent

huge

landholdings, the Constitution could have simply limited the size of alienable lands of the public domain that corporations could

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acquire. The Constitution could have followed the limitations on individuals, who could acquire not more than 24 hectares of alienable lands of the public domain under the 1973 Constitution, and not more than 12 hectares under the 1987 Constitution. If the Constitutional intent is to encourage economic family-size farms, placing the land in the name of a corporation would be more effective in preventing the break-up of farmland. If the farmland is registered in the name of a corporation, upon the death of the owner, his heirs would inherit shares in the corporation instead of subdivided This would prevent the continuing break-

parcels of the farmland.

up of farmlands into smaller and smaller parcels from one generation to the next. In actual practice, the Constitutional ban strengthens the

constitutional limitation on individuals from acquiring more than the allowed area of alienable lands of the public domain. Without the constitutional ban, individuals who already acquired the maximum area of alienable lands of the public domain could easily set up corporations to corporations could even as hide his means would allow him. An individual

his ownership of a corporation by putting his

nominees as stockholders of the corporation. The corporation is a convenient vehicle to circumvent the constitutional limitation of acquisition by individuals of alienable lands of the public domain. The constitutional intent, under the 1973 and 1987 Constitutions, is to transfer ownership of only a limited area or alienable land of the public domain to a qualified individual. This constitutional intent is safeguarded by the provision prohibiting corporations from acquiring alienable lands of the public domain, since the vehicle to circumvent the

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constitutional intent is removed. The available alienable public lands are gradually decreasing in the face of an ever-growing population. The most effective way to insure faithful adherence to this constitutional intent is to grant or sell alienable lands of the public domain only to individuals. This, it would seem, is the practical benefit arising from the constitutional ban. (Chavez vs. PEA, supra) However, in Natividad vs. Court of Appeals, G.R. No. 88233, October 4, 1991, it is held:

open, continuous, adverse and public possession of a land of the public domain from time immemorial by a private individual personally and through his predecessors confers an effective title on said possessor, whereby the land ceases to be public, to become private property. In Director of Lands vs. Intermediate Appellate Court and Acme Plywood & Veener Co., Inc., 146 SCRA 509, this Court upheld the doctrine that open, exclusive and undisputed possession of alienable land for the period prescribed by law creates the legal fiction whereby the land, upon completion of the requisite period ipso jure and without the need of judicial or other sanction, ceases to be public land and becomes private property. Under the facts of this case and pursuant to the above rulings, the parcels of land in question had already been converted to private ownership through acquisitive prescription by the predecessors-in-interest of TCMC when the latter purchased them in 1979. All that was needed was the confirmation of the titles of the previous owners or predecessors-in-interest of TCMC. Being already private land when TCMC bought them in 1979, the prohibition in the 1973 Constitution against corporations acquiring alienable lands of the public domain except through lease (Article XIV, Section 11, 1973 Constitution) did not apply them for they were no longer alienable lands of the public domain but private property.

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Recent Jurisprudence for Readings Philip Matthews vs. Benjamin and Joselyn Taylor, G.R. No. 164584, June 22, 2009 Assailed in this petition for review on certiorari are the Court of Appeals (CA) December 19, 2003 Decision and July 14, 2004 Resolution in CA-G.R. CV No. 59573. The assailed decision affirmed and upheld the June 30, 1997 Decision of the Regional Trial Court (RTC), Branch 8, Kalibo, Aklan in Civil Case No. 4632 for Declaration of Nullity of Agreement of Lease with Damages. On June 30, 1988, respondent Benjamin A. Taylor (Benjamin), a British subject, married Joselyn C. Taylor (Joselyn), a 17-year old Filipina. On June 9, 1989, while their marriage was subsisting, Joselyn bought from Diosa M. Martin a 1,294 square-meter lot (Boracay property) situated at Manoc-Manoc, Boracay Island, Malay, Aklan, for and in consideration of P129,000.00. The sale was allegedly financed by Benjamin. Joselyn and Benjamin, also using the latters funds, constructed improvements thereon and eventually converted the property to a vacation and tourist resort known as the Admiral Ben Bow Inn. All required permits and licenses for the operation of the resort were obtained in the name of Ginna Celestino, Joselyns sister. However, Benjamin and Joselyn had a falling out, and Joselyn ran away with Kim Philippsen. On June 8, 1992, Joselyn executed a Special Power of Attorney (SPA) in favor of Benjamin, authorizing the latter to maintain, sell, lease, and sub-lease and otherwise enter into contract with third parties with respect to their Boracay property. On July 20, 1992, Joselyn as lessor and petitioner Philip Matthews as lessee, entered into an Agreement of Lease (Agreement) involving the Boracay property for a period of 25 years, with an annual rental of P12,000.00. The agreement was signed by the parties and executed before a Notary Public. Petitioner thereafter took possession of the property and renamed the resort as Music Garden Resort. Claiming that the Agreement was null and void since it was entered into by Joselyn without his (Benjamins) consent, Benjamin instituted an action for Declaration of Nullity of Agreement of Lease with Damages against Joselyn and the petitioner. Benjamin claimed that his funds were used in the acquisition and improvement of the Boracay property, and coupled with the fact that he was Joselyns husband, any transaction involving said property required his consent. No Answer was filed, hence, the RTC declared Joselyn and the petitioner in defeault. On March 14, 1994, the RTC rendered judgment by default declaring the Agreement null and void. The decision was, however, set aside by the CA in CA-G.R. SP No. 34054. The CA also ordered the RTC to allow the petitioner to file his Answer, and to conduct further proceedings.

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In his Answer, petitioner claimed good faith in transacting with Joselyn. Since Joselyn appeared to be the owner of the Boracay property, he found it unnecessary to obtain the consent of Benjamin. Moreover, as appearing in the Agreement, Benjamin signed as a witness to the contract, indicating his knowledge of the transaction and, impliedly, his conformity to the agreement entered into by his wife. Benjamin was, therefore, estopped from questioning the validity of the Agreement. There being no amicable settlement during the pre-trial, trial on the merits ensued. On June 30, 1997, the RTC disposed of the case in this manner: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the defendants as follows: 1. The Agreement of Lease dated July 20, 1992 consisting of eight (8) pages (Exhibits T, T-1, T-2, T-3, T-4, T-5, T-6 and T-7) entered into by and between Joselyn C. Taylor and Philip Matthews before Notary Public Lenito T. Serrano under Doc. No. 390, Page 79, Book I, Series of 1992 is hereby declared NULL and VOID; Defendants are hereby ordered, jointly and severally, to pay plaintiff the sum of SIXTEEN THOUSAND (P16,000.00) PESOS as damages representing unrealized income for the residential building and cottages computed monthly from July 1992 up to the time the property in question is restored to plaintiff; and Defendants are hereby ordered, jointly and severally, to pay plaintiff the sum of TWENTY THOUSAND (P20,000.00) PESOS, Philippine Currency, for attorneys fees and other incidental expenses.

2.

3.

SO ORDERED. The RTC considered the Boracay property as community property of Benjamin and Joselyn; thus, the consent of the spouses was necessary to validate any contract involving the property. Benjamins right over the Boracay property was bolstered by the courts findings that the property was purchased and improved through funds provided by Benjamin. Although the Agreement was evidenced by a public document, the trial court refused to consider the alleged participation of Benjamin in the questioned transaction primarily because his signature appeared only on the last page of the document and not on every page thereof.

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On appeal to the CA, petitioner still failed to obtain a favorable decision. In its December 19, 2003 Decision, the CA affirmed the conclusions made by the RTC. The appellate court was of the view that if, indeed, Benjamin was a willing participant in the questioned transaction, the parties to the Agreement should have used the phrase with my consent instead of signed in the presence of. The CA noted that Joselyn already prepared an SPA in favor of Benjamin involving the Boracay property; it was therefore unnecessary for Joselyn to participate in the execution of the Agreement. Taken together, these circumstances yielded the inevitable conclusion that the contract was null and void having been entered into by Joselyn without the consent of Benjamin. Aggrieved, petitioner now comes before this Court in this petition for review on certiorari based on the following grounds: 4.1. THE MARITAL CONSENT OF RESPONDENT BENJAMIN TAYLOR IS NOT REQUIRED IN THE AGREEMENT OF LEASE DATED 20 JULY 1992. GRANTING ARGUENDO THAT HIS CONSENT IS REQUIRED, BENJAMIN TAYLOR IS DEEMED TO HAVE GIVEN HIS CONSENT WHEN HE AFFIXED HIS SIGNATURE IN THE AGREEMENT OF LEASE AS WITNESS IN THE LIGHT OF THE RULING OF THE SUPREME COURT IN THE CASE OF SPOUSES PELAYO VS. MELKI PEREZ, G.R. NO. 141323, JUNE 8, 2005. 4.2. THE PARCEL OF LAND SUBJECT OF THE AGREEMENT OF LEASE IS THE EXCLUSIVE PROPERTY OF JOCELYN C. TAYLOR, A FILIPINO CITIZEN, IN THE LIGHT OF CHEESMAN VS. IAC, G.R. NO. 74833, JANUARY 21, 1991. 4.3. THE COURTS A QUO ERRONEOUSLY APPLIED ARTICLE 96 OF THE FAMILY CODE OF THE PHILIPPINES WHICH IS A PROVISION REFERRING TO THE ABSOLUTE COMMUNITY OF PROPERTY. THE PROPERTY REGIME GOVERNING THE PROPERTY RELATIONS OF BENJAMIN TAYLOR AND JOSELYN TAYLOR IS THE CONJUGAL PARTNERSHIP OF GAINS BECAUSE THEY WERE MARRIED ON 30 JUNE 1988 WHICH IS PRIOR TO THE EFFECTIVITY OF THE FAMILY CODE. ARTICLE 96 OF THE FAMILY CODE OF THE PHILIPPINES FINDS NO APPLICATION IN THIS CASE. 4.4. THE HONORABLE COURT OF APPEALS IGNORED THE PRESUMPTION OF REGULARITY IN THE EXECUTION OF NOTARIAL DOCUMENTS. 4.5. THE HONORABLE COURT OF APPEALS FAILED TO PASS UPON THE COUNTERCLAIM OF PETITIONER DESPITE THE FACT THAT IT WAS NOT CONTESTED AND DESPITE THE PRESENTATION OF EVIDENCE ESTABLISHING SAID CLAIM. The petition is impressed with merit.

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In fine, we are called upon to determine the validity of an Agreement of Lease of a parcel of land entered into by a Filipino wife without the consent of her British husband. In addressing the matter before us, we are confronted not only with civil law or conflicts of law issues, but more importantly, with a constitutional question. It is undisputed that Joselyn acquired the Boracay property in 1989. Said acquisition was evidenced by a Deed of Sale with Joselyn as the vendee. The property was also declared for taxation purposes under her name. When Joselyn leased the property to petitioner, Benjamin sought the nullification of the contract on two grounds: first, that he was the actual owner of the property since he provided the funds used in purchasing the same; and second, that Joselyn could not enter into a valid contract involving the subject property without his consent. The trial and appellate courts both focused on the property relations of petitioner and respondent in light of the Civil Code and Family Code provisions. They, however, failed to observe the applicable constitutional principles, which, in fact, are the more decisive. Section 7, Article XII of the 1987 Constitution states: Section 7. Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain. Aliens, whether individuals or corporations, have been disqualified from acquiring lands of the public domain. Hence, by virtue of the aforecited constitutional provision, they are also disqualified from acquiring private lands. The primary purpose of this constitutional provision is the conservation of the national patrimony. Our fundamental law cannot be any clearer. The right to acquire lands of the public domain is reserved only to Filipino citizens or corporations at least sixty percent of the capital of which is owned by Filipinos. In Krivenko v. Register of Deeds, cited in Muller v. Muller, we had the occasion to explain the constitutional prohibition: Under Section 1 of Article XIII of the Constitution, natural resources, with the exception of public agricultural land, shall not be alienated, and with respect to public agricultural lands, their alienation is limited to Filipino citizens. But this constitutional purpose conserving agricultural resources in the hands of Filipino citizens may easily be defeated by the Filipino citizens themselves who may alienate their agricultural lands in favor of aliens. It is partly to prevent this result that Section 5 is included in Article XIII, and it reads as follows: Section 5. Save in cases of hereditary succession, no private agricultural land will be transferred or assigned except to individuals, corporations, or associations qualified

Page 8 of 66

to acquire or hold lands of the public domain in the Philippines. This constitutional provision closes the only remaining avenue through which agricultural resources may leak into aliens hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if, after all, they may be freely so alienated upon their becoming private agricultural lands in the hands of Filipino citizens. x x x xxxx If the term private agricultural lands is to be construed as not including residential lots or lands not strictly agricultural, the result would be that aliens may freely acquire and possess not only residential lots and houses for themselves but entire subdivisions, and whole towns and cities, and that they may validly buy and hold in their names lands of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds, airfields, and a host of other uses and purposes that are not, in appellants words, strictly agricultural. (Solicitor Generals Brief, p. 6) That this is obnoxious to the conservative spirit of the Constitution is beyond question. The rule is clear and inflexible: aliens are absolutely not allowed to acquire public or private lands in the Philippines, save only in constitutionally recognized exceptions. There is no rule more settled than this constitutional prohibition, as more and more aliens attempt to circumvent the provision by trying to own lands through another. In a long line of cases, we have settled issues that directly or indirectly involve the above constitutional provision. We had cases where aliens wanted that a particular property be declared as part of their fathers estate; that they be reimbursed the funds used in purchasing a property titled in the name of another; that an implied trust be declared in their (aliens) favor; and that a contract of sale be nullified for their lack of consent. In Ting Ho, Jr. v. Teng Gui, Felix Ting Ho, a Chinese citizen, acquired a parcel of land, together with the improvements thereon. Upon his death, his heirs (the petitioners therein) claimed the properties as part of the estate of their deceased father, and sought the partition of said properties among themselves. We, however, excluded the land and improvements thereon from the estate of Felix Ting Ho, precisely because he never became the owner thereof in light of the abovementioned constitutional prohibition. In Muller v. Muller, petitioner Elena Buenaventura Muller and respondent Helmut Muller were married in Germany. During the subsistence of their marriage, respondent purchased a parcel of land in Antipolo City and constructed a house thereon. The Antipolo property was registered in the name of the petitioner. They eventually separated, prompting the respondent to file a petition for separation of

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property. Specifically, respondent prayed for reimbursement of the funds he paid for the acquisition of said property. In deciding the case in favor of the petitioner, the Court held that respondent was aware that as an alien, he was prohibited from owning a parcel of land situated in the Philippines. He had, in fact, declared that when the spouses acquired the Antipolo property, he had it titled in the name of the petitioner because of said prohibition. Hence, we denied his attempt at subsequently asserting a right to the said property in the form of a claim for reimbursement. Neither did the Court declare that an implied trust was created by operation of law in view of petitioners marriage to respondent. We said that to rule otherwise would permit circumvention of the constitutional prohibition. In Frenzel v. Catito, petitioner, an Australian citizen, was married to Teresita Santos; while respondent, a Filipina, was married to Klaus Muller. Petitioner and respondent met and later cohabited in a common-law relationship, during which petitioner acquired real properties; and since he was disqualified from owning lands in the Philippines, respondents name appeared as the vendee in the deeds of sale. When their relationship turned sour, petitioner filed an action for the recovery of the real properties registered in the name of respondent, claiming that he was the real owner. Again, as in the other cases, the Court refused to declare petitioner as the owner mainly because of the constitutional prohibition. The Court added that being a party to an illegal contract, he could not come to court and ask to have his illegal objective carried out. One who loses his money or property by knowingly engaging in an illegal contract may not maintain an action for his losses. Finally, in Cheesman v. Intermediate Appellate Court, petitioner (an American citizen) and Criselda Cheesman acquired a parcel of land that was later registered in the latters name. Criselda subsequently sold the land to a third person without the knowledge of the petitioner. The petitioner then sought the nullification of the sale as he did not give his consent thereto. The Court held that assuming that it was his (petitioners) intention that the lot in question be purchased by him and his wife, he acquired no right whatever over the property by virtue of that purchase; and in attempting to acquire a right or interest in land, vicariously and clandestinely, he knowingly violated the Constitution; thus, the sale as to him was null and void. In light of the foregoing jurisprudence, we find and so hold that Benjamin has no right to nullify the Agreement of Lease between Joselyn and petitioner. Benjamin, being an alien, is absolutely prohibited from acquiring private and public lands in the Philippines. Considering that Joselyn appeared to be the designated vendee in the Deed of Sale of said property, she acquired sole ownership thereto. This is true even if we sustain Benjamins claim that he provided the funds for such acquisition. By entering into such contract knowing that it was illegal, no implied trust was created in his favor; no reimbursement for his expenses can be allowed; and no declaration can be made that the subject property was part of the conjugal/community property of the spouses. In any event, he had and has no capacity or personality to question the subsequent lease of the Boracay property by his wife on

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the theory that in so doing, he was merely exercising the prerogative of a husband in respect of conjugal property. To sustain such a theory would countenance indirect controversion of the constitutional prohibition. If the property were to be declared conjugal, this would accord the alien husband a substantial interest and right over the land, as he would then have a decisive vote as to its transfer or disposition. This is a right that the Constitution does not permit him to have. In fine, the Agreement of Lease entered into between Joselyn and petitioner cannot be nullified on the grounds advanced by Benjamin. Thus, we uphold its validity. With the foregoing disquisition, we find it unnecessary to address the other issues raised by the petitioner. WHEREFORE, premises considered, the December 19, 2003 Decision and July 14, 2004 Resolution of the Court of Appeals in CA-G.R. CV No. 59573, are REVERSED and SET ASIDE and a new one is entered DISMISSING the complaint against petitioner Philip Matthews. SO ORDERED. THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, THE REGIONAL EXECUTIVE DIRECTOR, DENR-REGION VI, REGIONAL TECHNICAL DIRECTOR FOR LANDS, LANDS MANAGEMENT BUREAU, REGION VI PROVINCIAL ENVIRONMENT AND NATURAL RESOURCES OFFICER OF KALIBO, AKLAN, REGISTER OF DEEDS, DIRECTOR OF LAND REGISTRATION AUTHORITY, DEPARTMENT OF TOURISM SECRETARY, DIRECTOR OF PHILIPPINE TOURISM AUTHORITY, Petitioners, - versus MAYOR JOSE S. YAP, LIBERTAD TALAPIAN, MILA Y. SUMNDAD, and ANICETO YAP, in their behalf and in behalf of all those similarly situated, Respondents. G.R. No. 167707 Present: PUNO, C.J., QUISUMBING, YNARES-SANTIAGO, CARPIO, AUSTRIA-MARTINEZ, CORONA,* CARPIO MORALES, AZCUNA, TINGA, CHICO-NAZARIO, VELASCO, JR., NACHURA,** REYES, LEONARDO-DE CASTRO, and BRION, JJ.

Promulgated: October 8, 2008

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x------------------------------- -----------x DR. ORLANDO SACAY and WILFREDO GELITO, joined by THE LANDOWNERS OF BORACAY SIMILARLY SITUATED NAMED IN A LIST, ANNEX A OF THIS PETITION, Petitioners, - versus THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, THE REGIONAL TECHNICAL DIRECTOR FOR LANDS, LANDS MANAGEMENT BUREAU, REGION VI, PROVINCIAL ENVIRONMENT AND NATURAL RESOURCES OFFICER, KALIBO, AKLAN, Respondents. x---------------------------------------------x G.R. No. 173775

DECISION
REYES, R.T., J.: AT stake in these consolidated cases is the right of the present occupants of Boracay Island to secure titles over their occupied lands. There are two consolidated petitions. The first is G.R. No. 167707, a petition for review on certiorari of the Decision of the Court of Appeals (CA) affirming that of the Regional Trial Court (RTC) in Kalibo, Aklan, which granted the petition for declaratory relief filed by respondentsclaimants Mayor Jose Yap, et al. and ordered the survey of Boracay for titling purposes. The second is G.R. No. 173775, a petition for prohibition, mandamus, and nullification of Proclamation No. 1064 issued by President Gloria Macapagal-Arroyo classifying Boracay into reserved forest and agricultural land. The Antecedents G.R. No. 167707 Boracay Island in the Municipality of Malay, Aklan, with its powdery white sand beaches and warm crystalline waters, is reputedly a premier Philippine tourist destination. The island is also home to 12,003 inhabitants who live in the bone-shaped islands three barangays.

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On April 14, 1976, the Department of Environment and Natural Resources (DENR) approved the National Reservation Survey of Boracay Island, which identified several lots as being occupied or claimed by named persons. On November 10, 1978, then President Ferdinand Marcos issued Proclamation No. 1801 declaring Boracay Island, among other islands, caves and peninsulas in the Philippines, as tourist zones and marine reserves under the administration of the Philippine Tourism Authority (PTA). President Marcos later approved the issuance of PTA Circular 382 dated September 3, 1982, to implement Proclamation No. 1801. Claiming that Proclamation No. 1801 and PTA Circular No 3-82 precluded them from filing an application for judicial confirmation of imperfect title or survey of land for titling purposes, respondentsclaimants

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Mayor Jose S. Yap, Jr., Libertad Talapian, Mila Y. Sumndad, and Aniceto Yap filed a petition for declaratory relief with the RTC in Kalibo, Aklan. In their petition, respondents-claimants alleged that Proclamation No. 1801 and PTA Circular No. 3-82 raised doubts on their right to secure titles over their occupied lands. They declared that they themselves, or through their predecessors-in-interest, had been in open, continuous, exclusive, and notorious possession and occupation in Boracay since June 12, 1945, or earlier since time immemorial. They declared their lands for tax purposes and paid realty taxes on them. Respondents-claimants posited that Proclamation No. 1801 and its implementing Circular did not place Boracay beyond the commerce of man. Since the Island was classified as a tourist zone, it was susceptible of private ownership. Under Section 48(b) of Commonwealth Act (CA) No. 141, otherwise known as the Public Land Act, they had the right to have the lots registered in their names through judicial confirmation of imperfect titles. The Republic, through the Office of the Solicitor General (OSG), opposed the petition for declaratory relief. The OSG countered that Boracay Island was an unclassified land of the public domain. It formed part of the mass of lands classified as public forest, which was not available for disposition pursuant to Section 3(a) of Presidential Decree (PD) No. 705 or the Revised Forestry Code, as amended. The OSG maintained that respondents-claimants reliance on PD No. 1801 and PTA Circular No. 3-82 was misplaced. Their right to judicial confirmation of title was governed by CA No. 141 and PD No. 705. Since Boracay Island had not been classified as alienable and disposable, whatever possession they had cannot ripen into ownership. During pre-trial, respondents-claimants and the OSG stipulated on the following facts: (1) respondents-claimants were presently in possession of parcels of land in Boracay Island; (2) these parcels of land were planted with coconut trees and other natural growing trees; (3) the coconut trees had heights of more or less twenty (20) meters and were planted more or less fifty (50) years ago; and (4) respondents-claimants declared the land they were occupying for tax purposes. The parties also agreed that the principal issue for resolution was purely legal: whether Proclamation No. 1801 posed any legal hindrance or impediment to the titling of the lands in Boracay. They decided to forego with the trial and to submit the case for resolution upon submission of their respective memoranda. The RTC took judicial notice that certain parcels of land in Boracay Island, more particularly Lots 1 and 30, Plan PSU-5344, were covered by Original Certificate of Title No. 19502 (RO 2222) in the name of the Heirs of Ciriaco S. Tirol. These lots were involved in Civil Case Nos. 5222 and 5262 filed before the RTC of Kalibo, Aklan. The titles were issued on August 7, 1933.

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RTC and CA Dispositions On July 14, 1999, the RTC rendered a decision in favor of respondents-claimants, with a fallo reading: WHEREFORE, in view of the foregoing, the Court declares that Proclamation No. 1801 and PTA Circular No. 382 pose no legal obstacle to the petitioners and those similarly situated to acquire title to their lands in Boracay, in accordance with the applicable laws and in the manner prescribed therein; and to have their lands surveyed and approved by respondent Regional Technical Director of Lands as the approved survey does not in itself constitute a title to the land. SO ORDERED. The RTC upheld respondents-claimants right to have their occupied lands titled in their name. It ruled that neither Proclamation No. 1801 nor PTA Circular No. 3-82 mentioned that lands in Boracay were inalienable or could not be the subject of disposition. The Circular itself recognized private ownership of lands. The trial court cited Sections 87 and 53 of the Public Land Act as basis for acknowledging private ownership of lands in Boracay and that only those forested areas in public lands were declared as part of the forest reserve. The OSG moved for reconsideration but its motion was denied. The Republic then appealed to the CA. On December 9, 2004, the appellate court affirmed in toto the RTC decision, disposing as follows: WHEREFORE, in view of the foregoing premises, judgment is hereby rendered by us DENYING the appeal filed in this case and AFFIRMING the decision of the lower court. The CA held that respondents-claimants could not be prejudiced by a declaration that the lands they occupied since time immemorial were part of a forest reserve. Again, the OSG sought reconsideration but it was similarly denied. Hence, the present petition under Rule 45. G.R. No. 173775 On May 22, 2006, during the pendency of G.R. No. 167707, President Gloria Macapagal-Arroyo issued Proclamation No. 1064 classifying Boracay Island into four hundred (400) hectares of reserved forest land (protection purposes) and six hundred twenty-eight and 96/100 (628.96) hectares of agricultural land (alienable and disposable). The Proclamation likewise provided for a fifteen-meter buffer zone on

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each side of the centerline of roads and trails, reserved for right-of-way and which shall form part of the area reserved for forest land protection purposes. On August 10, 2006, petitioners-claimants Dr. Orlando Sacay, Wilfredo Gelito, and other landowners in Boracay filed with this Court an original petition for prohibition, mandamus, and nullification of Proclamation No. 1064. They allege that the Proclamation infringed on their prior vested rights over portions of Boracay. They have been in continued possession of their respective lots in Boracay since time immemorial. They have also invested billions of pesos in developing their lands and building internationally renowned first class resorts on their lots. Petitioners-claimants contended that there is no need for a proclamation reclassifying Boracay into agricultural land. Being classified as neither mineral nor timber land, the island is deemed agricultural pursuant to the Philippine Bill of 1902 and Act No. 926, known as the first Public Land Act. Thus, their possession in the concept of owner for the required period entitled them to judicial confirmation of imperfect title. Opposing the petition, the OSG argued that petitioners-claimants do not have a vested right over their occupied portions in the island. Boracay is an unclassified public forest land pursuant to Section 3(a) of PD No. 705. Being public forest, the claimed portions of the island are inalienable and cannot be the subject of judicial confirmation of imperfect title. It is only the executive department, not the courts, which has authority to reclassify lands of the public domain into alienable and disposable lands. There is a need for a positive government act in order to release the lots for disposition. On November 21, 2006, this Court ordered the consolidation of the two petitions as they principally involve the same issues on the land classification of Boracay Island. Issues G.R. No. 167707 The OSG raises the lone issue of whether Proclamation No. 1801 and PTA Circular No. 3-82 pose any legal obstacle for respondents, and all those similarly situated, to acquire title to their occupied lands in Boracay Island.

G.R. No. 173775 Petitioners-claimants hoist five (5) issues, namely:

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I. AT THE TIME OF THE ESTABLISHED POSSESSION OF PETITIONERS IN CONCEPT OF OWNER OVER THEIR RESPECTIVE AREAS IN BORACAY, SINCE TIME IMMEMORIAL OR AT THE LATEST SINCE 30 YRS. PRIOR TO THE FILING OF THE PETITION FOR DECLARATORY RELIEF ON NOV. 19, 1997, WERE THE AREAS OCCUPIED BY THEM PUBLIC AGRICULTURAL LANDS AS DEFINED BY LAWS THEN ON JUDICIAL CONFIRMATION OF IMPERFECT TITLES OR PUBLIC FOREST AS DEFINED BY SEC. 3a, PD 705? II. HAVE PETITIONERS OCCUPANTS ACQUIRED PRIOR VESTED RIGHT OF PRIVATE OWNERSHIP OVER THEIR OCCUPIED PORTIONS OF BORACAY LAND, DESPITE THE FACT THAT THEY HAVE NOT APPLIED YET FOR JUDICIAL CONFIRMATION OF IMPERFECT TITLE? III. IS THE EXECUTIVE DECLARATION OF THEIR AREAS AS ALIENABLE AND DISPOSABLE UNDER SEC 6, CA 141 [AN] INDISPENSABLE PRE-REQUISITE FOR PETITIONERS TO OBTAIN TITLE UNDER THE TORRENS SYSTEM? IV. IS THE ISSUANCE OF PROCLAMATION 1064 ON MAY 22, 2006, VIOLATIVE OF THE PRIOR VESTED RIGHTS TO PRIVATE OWNERSHIP OF PETITIONERS OVER THEIR LANDS IN BORACAY, PROTECTED BY THE DUE PROCESS CLAUSE OF THE CONSTITUTION OR IS PROCLAMATION 1064 CONTRARY TO SEC. 8, CA 141, OR SEC. 4(a) OF RA 6657. V. CAN RESPONDENTS BE COMPELLED BY MANDAMUS TO ALLOW THE SURVEY AND TO APPROVE THE SURVEY PLANS FOR PURPOSES OF THE APPLICATION FOR TITLING OF THE LANDS OF PETITIONERS IN BORACAY? (Underscoring supplied) In capsule, the main issue is whether private claimants (respondents-claimants in G.R. No. 167707 and petitioners-claimants in G.R. No. 173775) have a right to secure titles over their occupied portions in Boracay. The twin petitions pertain to their right, if any, to judicial confirmation of imperfect title under CA No. 141, as amended. They do not involve their right to secure title under other pertinent laws. Our Ruling

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Regalian Doctrine and power of the executive to reclassify lands of the public domain Private claimants rely on three (3) laws and executive acts in their bid for judicial confirmation of imperfect title, namely: (a) Philippine Bill of 1902 in relation to Act No. 926, later amended and/or superseded by Act No. 2874 and CA No. 141; (b) Proclamation No. 1801 issued by then President Marcos; and (c) Proclamation No. 1064 issued by President Gloria Macapagal-Arroyo. We shall proceed to determine their rights to apply for judicial confirmation of imperfect title under these laws and executive acts. But first, a peek at the Regalian principle and the power of the executive to reclassify lands of the public domain. The 1935 Constitution classified lands of the public domain into agricultural, forest or timber. Meanwhile, the 1973 Constitution provided the following divisions: agricultural, industrial or commercial, residential, resettlement, mineral, timber or forest and grazing lands, and such other classes as may be provided by law, giving the government great leeway for classification. Then the 1987 Constitution reverted to the 1935 Constitution classification with one addition: national parks. Of these, only agricultural lands may be alienated. Prior to Proclamation No. 1064 of May 22, 2006, Boracay Island had never been expressly and administratively classified under any of these grand divisions. Boracay was an unclassified land of the public domain. The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the source of any asserted right to ownership of land and charged with the conservation of such patrimony. The doctrine has been consistently adopted under the 1935, 1973, and 1987 Constitutions. All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State. Thus, all lands that have not been acquired from the government, either by purchase or by grant, belong to the State as part of the inalienable public domain. Necessarily, it is up to the State to determine if lands of the public domain will be disposed of for private ownership. The government, as the agent of the state, is possessed of the plenary power as the persona in law to determine who shall be the favored recipients of public lands, as well as under what terms they may be granted such privilege, not excluding the placing of obstacles in the way of their exercise of what otherwise would be ordinary acts of ownership. Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of the Philippines, ownership of all lands, territories and possessions in the Philippines passed to the Spanish Crown. The Regalian doctrine was first introduced in the Philippines through the Laws of the Indies and the Royal Cedulas, which laid the foundation that all lands that were not acquired from the Government, either by purchase or by grant, belong to the public domain.

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The Laws of the Indies was followed by the Ley Hipotecaria or the Mortgage Law of 1893. The Spanish Mortgage Law provided for the systematic registration of titles and deeds as well as possessory claims. The Royal Decree of 1894 or the Maura Law partly amended the Spanish Mortgage Law and the Laws of the Indies. It established possessory information as the method of legalizing possession of vacant Crown land, under certain conditions which were set forth in said decree. Under Section 393 of the Maura Law, an informacion posesoria or possessory information title, when duly inscribed in the Registry of Property, is converted into a title of ownership only after the lapse of twenty (20) years of uninterrupted possession which must be actual, public, and adverse, from the date of its inscription. However, possessory information title had to be perfected one year after the promulgation of the Maura Law, or until April 17, 1895. Otherwise, the lands would revert to the State. In sum, private ownership of land under the Spanish regime could only be founded on royal concessions which took various forms, namely: (1) titulo real or royal grant; (2) concesion especial or special grant; (3) composicion con el estado or adjustment title; (4) titulo de compra or title by purchase; and (5) informacion posesoria or possessory information title. The first law governing the disposition of public lands in the Philippines under American rule was embodied in the Philippine Bill of 1902. By this law, lands of the public domain in the Philippine Islands were classified into three (3) grand divisions, to wit: agricultural, mineral, and timber or forest lands. The act provided for, among others, the disposal of mineral lands by means of absolute grant (freehold system) and by lease (leasehold system). It also provided the definition by exclusion of agricultural public lands. Interpreting the meaning of agricultural lands under the Philippine Bill of 1902, the Court declared in Mapa v. Insular Government: x x x In other words, that the phrase agricultural land as used in Act No. 926 means those public lands acquired from Spain which are not timber or mineral lands. x x x (Emphasis Ours) On February 1, 1903, the Philippine Legislature passed Act No. 496, otherwise known as the Land Registration Act. The act established a system of registration by which recorded title becomes absolute, indefeasible, and imprescriptible. This is known as the Torrens system. Concurrently, on October 7, 1903, the Philippine Commission passed Act No. 926, which was the first Public Land Act. The Act introduced the homestead system and made provisions for judicial and administrative confirmation of imperfect titles and for the sale or lease of public lands. It permitted corporations regardless of the nationality of persons owning the controlling stock to lease or purchase lands of the public domain. Under the Act, open, continuous, exclusive, and

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notorious possession and occupation of agricultural lands for the next ten (10) years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title. On November 29, 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as the second Public Land Act. This new, more comprehensive law limited the exploitation of agricultural lands to Filipinos and Americans and citizens of other countries which gave Filipinos the same privileges. For judicial confirmation of title, possession and occupation en concepto dueo since time immemorial, or since July 26, 1894, was required. After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on December 1, 1936. To this day, CA No. 141, as amended, remains as the existing general law governing the classification and disposition of lands of the public domain other than timber and mineral lands, and privately owned lands which reverted to the State. Section 48(b) of CA No. 141 retained the requirement under Act No. 2874 of possession and occupation of lands of the public domain since time immemorial or since July 26, 1894. However, this provision was superseded by Republic Act (RA) No. 1942, which provided for a simple thirty-year prescriptive period for judicial confirmation of imperfect title. The provision was last amended by PD No. 1073, which now provides for possession and occupation of the land applied for since June 12, 1945, or earlier. The issuance of PD No. 892 on February 16, 1976 discontinued the use of Spanish titles as evidence in land registration proceedings. Under the decree, all holders of Spanish titles or grants should apply for registration of their lands under Act No. 496 within six (6) months from the effectivity of the decree on February 16, 1976. Thereafter, the recording of all unregistered lands shall be governed by Section 194 of the Revised Administrative Code, as amended by Act No. 3344. On June 11, 1978, Act No. 496 was amended and updated by PD No. 1529, known as the Property Registration Decree. It was enacted to codify the various laws relative to registration of property. It governs registration of lands under the Torrens system as well as unregistered lands, including chattel mortgages. 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 officially delimited and classified. 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

Page 20 of 66

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. In the case at bar, no such proclamation, executive order, administrative action, report, statute, or certification was presented to the Court. The records are bereft of evidence showing that, prior to 2006, the portions of Boracay occupied by private claimants were subject of a government proclamation that the land is alienable and disposable. Absent such well-nigh incontrovertible evidence, the Court cannot accept the submission that lands occupied by private claimants were already open to disposition before 2006. Matters of land classification or reclassification cannot be assumed. They call for proof. Ankron and De Aldecoa did not make the whole of Boracay Island, or portions of it, agricultural lands. Private claimants posit that Boracay was already an agricultural land pursuant to the old cases Ankron v. Government of the Philippine Islands (1919) and De Aldecoa v. The Insular Government (1909). These cases were decided under the provisions of the Philippine Bill of 1902 and Act No. 926. There is a statement in these old cases that in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown. Private claimants reliance on Ankron and De Aldecoa is misplaced. These cases did not have the effect of converting the whole of Boracay Island or portions of it into agricultural lands. It should be stressed that the Philippine Bill of 1902 and Act No. 926 merely provided the manner through which land registration courts would classify lands of the public domain. Whether the land would be classified as timber, mineral, or agricultural depended on proof presented in each case. Ankron and De Aldecoa were decided at a time when the President of the Philippines had no power to classify lands of the public domain into mineral, timber, and agricultural. At that time, the courts were free to make corresponding classifications in justiciable cases, or were vested with implicit power to do so, depending upon the preponderance of the evidence. This was the Courts ruling in Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols Vda. De Palanca v. Republic, in which it stated, through Justice Adolfo Azcuna, viz.: x x x Petitioners furthermore insist that a particular land need not be formally released by an act of the

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Executive before it can be deemed open to private ownership, citing the cases of Ramos v. Director of Lands and Ankron v. Government of the Philippine Islands. xxxx Petitioners reliance upon Ramos v. Director of Lands and Ankron v. Government is misplaced. These cases were decided under the Philippine Bill of 1902 and the first Public Land Act No. 926 enacted by the Philippine Commission on October 7, 1926, under which there was no legal provision vesting in the Chief Executive or President of the Philippines the power to classify lands of the public domain into mineral, timber and agricultural so that the courts then were free to make corresponding classifications in justiciable cases, or were vested with implicit power to do so, depending upon the preponderance of the evidence. To aid the courts in resolving land registration cases under Act No. 926, it was then necessary to devise a presumption on land classification. Thus evolved the dictum in Ankron that the courts have a right to presume, in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown. But We cannot unduly expand the presumption in Ankron and De Aldecoa to an argument that all lands of the public domain had been automatically reclassified as disposable and alienable agricultural lands. By no stretch of imagination did the presumption convert all lands of the public domain into agricultural lands. If We accept the position of private claimants, the Philippine Bill of 1902 and Act No. 926 would have automatically made all lands in the Philippines, except those already classified as timber or mineral land, alienable and disposable lands. That would take these lands out of State ownership and worse, would be utterly inconsistent with and totally repugnant to the long-entrenched Regalian doctrine. The presumption in Ankron and De Aldecoa attaches only to land registration cases brought under the provisions of Act No. 926, or more specifically those cases dealing with judicial and administrative confirmation of imperfect titles. The presumption applies to an applicant for judicial or administrative conformation of imperfect title under Act No. 926. It certainly cannot apply to landowners, such as private claimants or their predecessors-in-interest, who failed to avail themselves of the benefits of Act No. 926. As to them, their land remained unclassified and, by virtue of the Regalian doctrine, continued to be owned by the State. In any case, the assumption in Ankron and De Aldecoa was not absolute. Land classification was, in the end, dependent on proof. If there was proof that the land was better suited for non-agricultural uses, the courts could adjudge it as a mineral or timber land despite the presumption. In Ankron, this Court stated:

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In the case of Jocson vs. Director of Forestry (supra), the Attorney-General admitted in effect that whether the particular land in question belongs to one class or another is a question of fact. The mere fact that a tract of land has trees upon it or has mineral within it is not of itself sufficient to declare that one is forestry land and the other, mineral land. There must be some proof of the extent and present or future value of the forestry and of the minerals. While, as we have just said, many definitions have been given for agriculture, forestry, and mineral lands, and that in each case it is a question of fact, we think it is safe to say that in order to be forestry or mineral land the proof must show that it is more valuable for the forestry or the mineral which it contains than it is for agricultural purposes. (Sec. 7, Act No. 1148.) It is not sufficient to show that there exists some trees upon the land or that it bears some mineral. Land may be classified as forestry or mineral today, and, by reason of the exhaustion of the timber or mineral, be classified as agricultural land tomorrow. And vice-versa, by reason of the rapid growth of timber or the discovery of valuable minerals, lands classified as agricultural today may be differently classified tomorrow. Each case must be decided upon the proof in that particular case, having regard for its present or future value for one or the other purposes. We believe, however, considering the fact that it is a matter of public knowledge that a majority of the lands in the Philippine Islands are agricultural lands that the courts have a right to presume, in the absence of evidence to the contrary, that in each case the lands are agricultural lands until the contrary is shown. Whatever the land involved in a particular land registration case is forestry or mineral land must, therefore, be a matter of proof. Its superior value for one purpose or the other is a question of fact to be settled by the proof in each particular case. The fact that the land is a manglar [mangrove swamp] is not sufficient for the courts to decide whether it is agricultural, forestry, or mineral land. It may perchance belong to one or the other of said classes of land. The Government, in the first instance, under the provisions of Act No. 1148, may, by reservation, decide for itself what portions of public land shall be considered forestry land, unless private interests have intervened before such reservation is made. In the latter case, whether the land is agricultural, forestry, or mineral, is a question of proof. Until private interests have intervened, the Government, by virtue of the terms of said Act (No. 1148), may decide for itself what portions of the public domain shall be set aside and reserved as forestry or mineral land. (Ramos vs. Director of Lands, 39 Phil. 175; Jocson vs. Director of Forestry, supra) (Emphasis ours) Since 1919, courts were no longer free to determine the classification of lands from the facts of each case, except those that have already became private lands. Act No. 2874, promulgated in 1919

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and reproduced in Section 6 of CA No. 141, gave the Executive Department, through the President, the exclusive prerogative to classify or reclassify public lands into alienable or disposable, mineral or forest.96-a Since then, courts no longer had the authority, whether express or implied, to determine the classification of lands of the public domain. Here, private claimants, unlike the Heirs of Ciriaco Tirol who were issued their title in 1933, did not present a justiciable case for determination by the land registration court of the propertys land classification. Simply put, there was no opportunity for the courts then to resolve if the land the Boracay occupants are now claiming were agricultural lands. When Act No. 926 was supplanted by Act No. 2874 in 1919, without an application for judicial confirmation having been filed by private claimants or their predecessors-in-interest, the courts were no longer authorized to determine the propertys land classification. Hence, private claimants cannot bank on Act No. 926. We note that the RTC decision in G.R. No. 167707 mentioned Krivenko v. Register of Deeds of Manila, which was decided in 1947 when CA No. 141, vesting the Executive with the sole power to classify lands of the public domain was already in effect. Krivenko cited the old cases Mapa v. Insular Government, De Aldecoa v. The Insular Government, and Ankron v. Government of the Philippine Islands. Krivenko, however, is not controlling here because it involved a totally different issue. The pertinent issue in Krivenko was whether residential lots were included in the general classification of agricultural lands; and if so, whether an alien could acquire a residential lot. This Court ruled that as an alien, Krivenko was prohibited by the 1935 Constitution from acquiring agricultural land, which included residential lots. Here, the issue is whether unclassified lands of the public domain are automatically deemed agricultural. Notably, the definition of agricultural public lands mentioned in Krivenko relied on the old cases decided prior to the enactment of Act No. 2874, including Ankron and De Aldecoa. As We have already stated, those cases cannot apply here, since they were decided when the Executive did not have the authority to classify lands as agricultural, timber, or mineral. Private claimants continued possession under Act No. 926 does not create a presumption that the land is alienable. Private claimants also contend that their continued possession of portions of Boracay Island for the requisite period of ten (10) years under Act No. 926 ipso facto converted the island into private ownership. Hence, they may apply for a title in their name. A similar argument was squarely rejected by the Court in Collado v. Court of Appeals. Collado, citing the separate opinion of now Chief Justice Reynato S. Puno in Cruz v. Secretary of Environment and Natural Resources,107-a ruled:

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Act No. 926, the first Public Land Act, was passed in pursuance of the provisions of the Philippine Bill of 1902. The law governed the disposition of lands of the public domain. It prescribed rules and regulations for the homesteading, selling and leasing of portions of the public domain of the Philippine Islands, and prescribed the terms and conditions to enable persons to perfect their titles to public lands in the Islands. It also provided for the issuance of patents to certain native settlers upon public lands, for the establishment of town sites and sale of lots therein, for the completion of imperfect titles, and for the cancellation or confirmation of Spanish concessions and grants in the Islands. In short, the Public Land Act operated on the assumption that title to public lands in the Philippine Islands remained in the government; and that the governments title to public land sprung from the Treaty of Paris and other subsequent treaties between Spain and the United States. The term public land referred to all lands of the public domain whose title still remained in the government and are thrown open to private appropriation and settlement, and excluded the patrimonial property of the government and the friar lands. Thus, it is plain error for petitioners to argue that under the Philippine Bill of 1902 and Public Land Act No. 926, mere possession by private individuals of lands creates the legal presumption that the lands are alienable and disposable. (Emphasis Ours) Except for lands already covered by existing titles, Boracay was an unclassified land of the public domain prior to Proclamation No. 1064. Such unclassified lands are considered public forest under PD No. 705. The DENR and the National Mapping and Resource Information Authority certify that Boracay Island is an unclassified land of the public domain. PD No. 705 issued by President Marcos categorized all unclassified lands of the public domain as public forest. Section 3(a) of PD No. 705 defines a public forest as a mass of lands of the public domain which has not been the subject of the present system of classification for the determination of which lands are needed for forest purpose and which are not. Applying PD No. 705, all unclassified lands, including those in Boracay Island, are ipso facto considered public forests. PD No. 705, however, respects titles already existing prior to its effectivity. The Court notes that the classification of Boracay as a forest land under PD No. 705 may seem to be out of touch with the present realities in the island. Boracay, no doubt, has been partly stripped of its forest cover to pave the way for commercial developments. As a premier

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tourist destination for local and foreign tourists, Boracay appears more of a commercial island resort, rather than a forest land. Nevertheless, that the occupants of Boracay have built multimillion peso beach resorts on the island; that the island has already been stripped of its forest cover; or that the implementation of Proclamation No. 1064 will destroy the islands tourism industry, do not negate its character as public forest. Forests, in the context of both the Public Land Act and the Constitution classifying lands of the public domain into agricultural, forest or timber, mineral lands, and national parks, do not necessarily refer to large tracts of wooded land or expanses covered by dense growths of trees and underbrushes. The discussion in Heirs of Amunategui v. Director of Forestry is particularly instructive: A forested area classified as forest land of the public domain does not lose such classification simply because loggers or settlers may have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered with grass or planted to crops by kaingin cultivators or other farmers. Forest lands do not have to be on mountains or in out of the way places. Swampy areas covered by mangrove trees, nipa palms, and other trees growing in brackish or sea water may also be classified as forest land. The classification is descriptive of its legal nature or status and does not have to be descriptive of what the land actually looks like. Unless and until the land classified as forest is released in an official proclamation to that effect so that it may form part of the disposable agricultural lands of the public domain, the rules on confirmation of imperfect title do not apply. (Emphasis supplied) There is a big difference between forest as defined in a dictionary and forest or timber land as a classification of lands of the public domain as appearing in our statutes. One is descriptive of what appears on the land while the other is a legal status, a classification for legal purposes. At any rate, the Court is tasked to determine the legal status of Boracay Island, and not look into its physical layout. Hence, even if its forest cover has been replaced by beach resorts, restaurants and other commercial establishments, it has not been automatically converted from public forest to alienable agricultural land. Private claimants cannot rely on Proclamation No. 1801 as basis for judicial confirmation of imperfect title. The proclamation did not convert Boracay into an agricultural land. However, private claimants argue that Proclamation No. 1801 issued by then President Marcos in 1978 entitles them to judicial confirmation of imperfect title. The Proclamation classified Boracay, among other islands, as a tourist zone. Private claimants assert that, as a tourist spot, the island is susceptible of private ownership.

Page 26 of 66

Proclamation No. 1801 or PTA Circular No. 3-82 did not convert the whole of Boracay into an agricultural land. There is nothing in the law or the Circular which made Boracay Island an agricultural land. The reference in Circular No. 3-82 to private lands and areas declared as alienable and disposable does not by itself classify the entire island as agricultural. Notably, Circular No. 3-82 makes reference not only to private lands and areas but also to public forested lands. Rule VIII, Section 3 provides: No trees in forested private lands may be cut without prior authority from the PTA. All forested areas in public lands are declared forest reserves. (Emphasis supplied) Clearly, the reference in the Circular to both private and public lands merely recognizes that the island can be classified by the Executive department pursuant to its powers under CA No. 141. In fact, Section 5 of the Circular recognizes the then Bureau of Forest Developments authority to declare areas in the island as alienable and disposable when it provides: Subsistence farming, in areas declared as alienable and disposable by the Bureau of Forest Development. Therefore, Proclamation No. 1801 cannot be deemed the positive act needed to classify Boracay Island as alienable and disposable land. If President Marcos intended to classify the island as alienable and disposable or forest, or both, he would have identified the specific limits of each, as President Arroyo did in Proclamation No. 1064. This was not done in Proclamation No. 1801. The Whereas clauses of Proclamation No. 1801 also explain the rationale behind the declaration of Boracay Island, together with other islands, caves and peninsulas in the Philippines, as a tourist zone and marine reserve to be administered by the PTA to ensure the concentrated efforts of the public and private sectors in the development of the areas tourism potential with due regard for ecological balance in the marine environment. Simply put, the proclamation is aimed at administering the islands for tourism and ecological purposes. It does not address the areas alienability. More importantly, Proclamation No. 1801 covers not only Boracay Island, but sixty-four (64) other islands, coves, and peninsulas in the Philippines, such as Fortune and Verde Islands in Batangas, Port Galera in Oriental Mindoro, Panglao and Balicasag Islands in Bohol, Coron Island, Puerto Princesa and surrounding areas in Palawan, Camiguin Island in Cagayan de Oro, and Misamis Oriental, to name a few. If the designation of Boracay Island as tourist zone makes it alienable and disposable by virtue of Proclamation No. 1801, all the other areas mentioned would likewise be declared wide open for private disposition. That could not have been, and is clearly beyond, the intent of the proclamation. It was Proclamation No. 1064 of 2006 which positively declared part of Boracay as alienable and opened the same to

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private ownership. Sections 6 and 7 of CA No. 141 provide that it is only the President, upon the recommendation of the proper department head, who has the authority to classify the lands of the public domain into alienable or disposable, timber and mineral lands. In issuing Proclamation No. 1064, President Gloria MacapagalArroyo merely exercised the authority granted to her to classify lands of the public domain, presumably subject to existing vested rights. Classification of public lands is the exclusive prerogative of the Executive Department, through the Office of the President. Courts have no authority to do so. Absent such classification, the land remains unclassified until released and rendered open to disposition. Proclamation No. 1064 classifies Boracay into 400 hectares of reserved forest land and 628.96 hectares of agricultural land. The Proclamation likewise provides for a 15-meter buffer zone on each side of the center line of roads and trails, which are reserved for right of way and which shall form part of the area reserved for forest land protection purposes. Contrary to private claimants argument, there was nothing invalid or irregular, much less unconstitutional, about the classification of Boracay Island made by the President through Proclamation No. 1064. It was within her authority to make such classification, subject to existing vested rights. Proclamation No. 1064 does not violate the Comprehensive Agrarian Reform Law. Private claimants further assert that Proclamation No. 1064 violates the provision of the Comprehensive Agrarian Reform Law (CARL) or RA No. 6657 barring conversion of public forests into agricultural lands. They claim that since Boracay is a public forest under PD No. 705, President Arroyo can no longer convert it into an agricultural land without running afoul of Section 4(a) of RA No. 6657, thus: SEC. 4. Scope. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable for agriculture. More specifically, the following lands are covered by the Comprehensive Agrarian Reform Program: (a) All alienable and disposable lands of the public domain devoted to or suitable for agriculture. No reclassification of forest or mineral lands to agricultural lands shall be undertaken after the approval of this Act until Congress, taking into account ecological, developmental and equity considerations, shall have determined by law, the specific limits of the public domain.

Page 28 of 66

That Boracay Island was classified as a public forest under PD No. 705 did not bar the Executive from later converting it into agricultural land. Boracay Island still remained an unclassified land of the public domain despite PD No. 705. In Heirs of the Late Spouses Pedro S. Palanca and Soterranea Rafols v. Republic, the Court stated that unclassified lands are public forests. While it is true that the land classification map does not categorically state that the islands are public forests, the fact that they were unclassified lands leads to the same result. In the absence of the classification as mineral or timber land, the land remains unclassified land until released and rendered open to disposition. (Emphasis supplied) Moreover, the prohibition under the CARL applies reclassification of land. If the land had never been classified, as in the case of Boracay, there can be no reclassification under the agrarian law. We agree with the the Department of Justice on this point: only to a previously prohibited opinion of

Indeed, the key word to the correct application of the prohibition in Section 4(a) is the word reclassification. Where there has been no previous classification of public forest [referring, we repeat, to the mass of the public domain which has not been the subject of the present system of classification for purposes of determining which are needed for forest purposes and which are not] into permanent forest or forest reserves or some other forest uses under the Revised Forestry Code, there can be no reclassification of forest lands to speak of within the meaning of Section 4(a). Thus, obviously, the prohibition in Section 4(a) of the CARL against the reclassification of forest lands to agricultural lands without a prior law delimiting the limits of the public domain, does not, and cannot, apply to those lands of the public domain, denominated as public forest under the Revised Forestry Code, which have not been previously determined, or classified, as needed for forest purposes in accordance with the provisions of the Revised Forestry Code. Private claimants are not entitled to apply for judicial confirmation of imperfect title under CA No. 141. Neither do they have vested rights over the occupied lands under the said law. There are two requisites for judicial confirmation of imperfect or incomplete title under CA No. 141, namely: (1) open, continuous, exclusive, and notorious possession and occupation of the subject land by himself or through his predecessors-in-interest under a bona fide claim of ownership since time immemorial or from June 12, 1945; and

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(2) the classification of the land as alienable and disposable land of the public domain. As discussed, the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801 did not convert portions of Boracay Island into an agricultural land. The island remained an unclassified land of the public domain and, applying the Regalian doctrine, is considered State property. Private claimants bid for judicial confirmation of imperfect title, relying on the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801, must fail because of the absence of the second element of alienable and disposable land. Their entitlement to a government grant under our present Public Land Act presupposes that the land possessed and applied for is already alienable and disposable. This is clear from the wording of the law itself. Where the land is not alienable and disposable, possession of the land, no matter how long, cannot confer ownership or possessory rights. Neither may private claimants apply for judicial confirmation of imperfect title under Proclamation No. 1064, with respect to those lands which were classified as agricultural lands. Private claimants failed to prove the first element of open, continuous, exclusive, and notorious possession of their lands in Boracay since June 12, 1945. We cannot sustain the CA and RTC conclusion in the petition for declaratory relief that private claimants complied with the requisite period of possession. The tax declarations in the name of private claimants are insufficient to prove the first element of possession. We note that the earliest of the tax declarations in the name of private claimants were issued in 1993. Being of recent dates, the tax declarations are not sufficient to convince this Court that the period of possession and occupation commenced on June 12, 1945. Private claimants insist that they have a vested right in Boracay, having been in possession of the island for a long time. They have invested millions of pesos in developing the island into a tourist spot. They say their continued possession and investments give them a vested right which cannot be unilaterally rescinded by Proclamation No. 1064. The continued possession and considerable investment of private claimants do not automatically give them a vested right in Boracay. Nor do these give them a right to apply for a title to the land they are presently occupying. This Court is constitutionally bound to decide cases based on the evidence presented and the laws applicable. As the law and jurisprudence stand, private claimants are ineligible to apply for a judicial confirmation of title over their occupied portions in Boracay even with their continued possession and considerable investment in the island.

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One Last Note The Court is aware that millions of pesos have been invested for the development of Boracay Island, making it a by-word in the local and international tourism industry. The Court also notes that for a number of years, thousands of people have called the island their home. While the Court commiserates with private claimants plight, We are bound to apply the law strictly and judiciously. This is the law and it should prevail. Ito ang batas at ito ang dapat umiral. All is not lost, however, for private claimants. While they may not be eligible to apply for judicial confirmation of imperfect title under Section 48(b) of CA No. 141, as amended, this does not denote their automatic ouster from the residential, commercial, and other areas they possess now classified as agricultural. Neither will this mean the loss of their substantial investments on their occupied alienable lands. Lack of title does not necessarily mean lack of right to possess. For one thing, those with lawful possession may claim good faith as builders of improvements. They can take steps to preserve or protect their possession. For another, they may look into other modes of applying for original registration of title, such as by homestead or sales patent, subject to the conditions imposed by law. More realistically, Congress may enact a law to entitle private claimants to acquire title to their occupied lots or to exempt them from certain requirements under the present land laws. There is one such bill now pending in the House of Representatives. Whether that bill or a similar bill will become a law is for Congress to decide. In issuing Proclamation No. 1064, the government has taken the step necessary to open up the island to private ownership. This gesture may not be sufficient to appease some sectors which view the classification of the island partially into a forest reserve as absurd. That the island is no longer overrun by trees, however, does not becloud the vision to protect its remaining forest cover and to strike a healthy balance between progress and ecology. Ecological conservation is as important as economic progress. To be sure, forest lands are fundamental to our nations survival. Their promotion and protection are not just fancy rhetoric for politicians and activists. These are needs that become more urgent as destruction of our environment gets prevalent and difficult to control. As aptly observed by Justice Conrado Sanchez in 1968 in Director of Forestry v. Munoz: The view this Court takes of the cases at bar is but in adherence to public policy that should be followed with respect to forest lands. Many have written much, and many more have spoken, and quite often, about the pressing need for forest preservation, conservation, protection, development and reforestation. Not without justification. For, forests constitute a vital segment of any country's

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natural resources. It is of common knowledge by now that absence of the necessary green cover on our lands produces a number of adverse or ill effects of serious proportions. Without the trees, watersheds dry up; rivers and lakes which they supply are emptied of their contents. The fish disappear. Denuded areas become dust bowls. As waterfalls cease to function, so will hydroelectric plants. With the rains, the fertile topsoil is washed away; geological erosion results. With erosion come the dreaded floods that wreak havoc and destruction to property crops, livestock, houses, and highways not to mention precious human lives. Indeed, the foregoing observations should be written down in a lumbermans decalogue. WHEREFORE, judgment is rendered as follows: 1. The petition for certiorari in G.R. No. 167707 is GRANTED and the Court of Appeals Decision in CA-G.R. CV No. 71118 REVERSED AND SET ASIDE. 2. The petition for certiorari in G.R. No. 173775 is DISMISSED for lack of merit. SO ORDERED.

THIRD DIVISION REPUBLIC OF THE PHILIPPINES, Petitioner, G.R. No. 157306 Present: Panganiban, J., Chairman, Sandoval-Gutierrez, Corona, Carpio Morales, and Garcia, JJ

- versus -

ANATALIA ACTUB TIU ESTONILO and ANDREA ACTUB TIU PO Promulgated: (in Substitution of NAZARIA BOMBEO), November 25, 2005 Respondents. _______________ x -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- x DECISION PANGANIBAN, J.:

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To segregate portions of the public domain as reservations for the use of the Republic of the Philippines or any of its branches, like the Armed Forces of the Philippines, all that is needed is a presidential proclamation to that effect. A court judgment is not necessary to make the proclamation effective or valid. The Case Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to reverse and set aside the February 21, 2003 Decision[2] of the Court of Appeals (CA) in CA-GR CV No. 66807. The assailed CA Decision disposed as follows: WHEREFORE, the foregoing premises considered, the ruling of the trial court is hereby AFFIRMED.[3] The Facts The antecedents were summarized by the CA as follows: This case originated from an application for registration of a parcel of land known as Lot No. 4318 of the cadastral survey of Cagayan de Oro consisting [of] an area of 357,866 square meters, filed by [the] original [a]pplicant, Nazaria Bombeo with the defunct Court of First Instance of Misamis Oriental on July 22, 1954. In her application, Bombeo claimed that said parcel of land was previously owned and possessed by a certain Rosendo Bacas since 1894 until it was sold to her by the heirs of Rosendo Bacas, represented by their attorney-in-fact and heir himself, Calistro Bacas by virtue of an Absolute Sale of Realty (Exhibit A) on June 14, 1954. After due notice and publication of said application, only the Provincial Fiscal of Misamis Oriental, in behalf of the Chief of Staff of the Armed Forces of the Philippines [AFP] and the Director of [the] Bureau of Land[s] filed its opposition thereto, alleging that Lot 4318 is not a registrable land pursuant to Presidential Proclamation No. 265, which took effect on March 31, 1938, and which declared Lot 4318 reserved for the use of the Philippine Army, to wit: PRESIDENTIAL PROCLAMATION NO. 265. RESERVING FOR THE USE OF THE PHILIPPINE ARMY THREE PARCELS OF THE PUBLIC DOMAIN SITUATED IN THE BARRIOS OF BULUA AND CARMEN, MUNICIPALITY OF CAGAYAN, PROVINCE OF MISAMIS ORIENTAL, ISLAND OF MINDANAO. Upon the recommendation of the Secretary of Agriculture and Commerce and pursuant to the provision of section eighty-three

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of Commonwealth Act Number One Hundred and Forty-one, I hereby withdraw from sale of settlement and reserve for the use of the Philippine Army, under the administration of the Chief of Staff subject to private rights, if any thereby, the following described parcels of public domain, situated in the barrios of Bulua and Carmen, Municipality of Cagayan, Province of Misamis Oriental, Island of Mindanao, and particularly described in Bureau of Lands SWO15234, to wit: Lot No. 4318. x x x. Containing an area of 354,377 square meters. During the initial hearing set on February 12, 1955, an Order of General Default was issued by the lower court. On July 29, 1959, Bombeo died and was substituted by her daughter Cipriana Actub Tiu who eventually died on December 5, 1990. Thereafter, due to intervening deaths of the parties, the case literally went to slumber until it was reraffled to the Regional Trial Court (Branch 17) of Misamis Oriental on October 16, 1991 and was pursued anew by the daughters of Cipriana Actub Tiu, namely, Anatalia Actub Tiu Estonilo and Andrea Actub Tiu Po. On the other hand, Oppositors Bureau of Lands and Chief of Staff of the Armed Forces of the Philippines, in behalf of the Republic of the Philippines; were represented by the Provincial Prosecutor Florencia Abbu and Major Raul Llacuna of JAGO [Judge Advocate Generals Office]. On May 27, 1994, the trial court confirmed title over Lot 4318 to Nazaria Bombeo substituted by her heirs Anatalia Actub Tiu Estonilo and Andrea Actub Tiu Po and ordered registration thereof under the names of the latter. Consequently, Oppositors Bureau of Lands and Chief of Staff of Armed Forces of the Philippines, through the Solicitor Generals Office; filed an appeal to said decision x x x. During the pendency of the appeal, however, Presidential Proclamation No. 330[4] took effect on June 20, 2000, excluding Lot 4318 from the operation of Presidential Proclamation No. 265[.] xxx xxx xxx

In view of the aforesaid decree, x x x [respondents urged the CA] to finally put to rest the controversy in their favor considering that the opposition of the Republic has no longer any basis.[5] Ruling of the Court of Appeals

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The Court of Appeals ruled that Presidential Proclamation No. 265 (Proc 265) failed to segregate effectively Lot 4318 as part of the military reservation. The CA said that the proclamation was not self-executory and self-adjudicating considering that there is a need to determine private rights of claimants over lands sought to be reserved. Moreover, the appellate court agreed with the trial court that respondents were able to establish with sufficient evidence their right to have the land registered under their names. It acknowledged that possession by respondents predecessors-in-interest had ripened into an imperfect title of ownership, subject to judicial confirmation. It added that ownership of the land would still be deemed vested in respondents, in view of their almost half a century of open, continuous, adverse and peaceful possession, even if possession by their predecessors-ininterest were not taken into consideration. Hence, this Petition.[6] Issues Petitioner raises the following issues for our consideration: I. Whether or not the Court of Appeals gravely erred in holding that Presidential Proclamation No. 265 did not effectively segregate Lot 4318 from the public domain. II. Whether or not the Court of Appeals gravely erred in finding that respondents were able to establish that they have already acquired private right over Lot 4318 which already amounted to a title. III. Whether or not the Court of Appeals gravely erred in holding that the passage of Presidential Proclamation No. 330 which excludes from the operation of Presidential Proclamation No. 265 Lot 4318 negates the claim of the AFP that the land in dispute is actively possessed and used by it.[7] In short, the main issue is whether respondents have duly proven their title to the subject land and may thus register it under the Public Land Act.

The Courts Ruling The Petition is meritorious.

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Main Issue: Validity of Respondents Title The Public Land Act[8] requires applicants for confirmation of imperfect titles to prove (1) that the land is alienable public land;[9] and (2) that their open, continuous, exclusive and notorious possession and occupation of the property has taken place either since time immemorial or for the period prescribed by law. When the legal conditions are complied with, the possessor of the land -- by operation of law -- acquires a right to a government grant, without necessitating the issuance of a certificate of title.[10] After a meticulous review of the Decisions of both the trial and the appellate courts, as well as of the evidence on record, the Court finds that respondents failed to satisfy the above legal requirements. Nature of Lot 4318 It is not disputed that Proc 265 specifically reserved Lot 4318 for the use of the Philippine Army. Respondents maintain, though, that the land was not effectively segregated as a military reservation by the Proclamation. Relying on Baloy v. CA,[11] they allege that a petition for reservation or a court judgment declaring the reservation is necessary to make Proc 265 effective. They maintain that the provision in the Proclamation subjecting the reservation to private rights presumes that notice and hearing will be afforded to all persons claiming ownership rights over the land. Otherwise, the reservation would amount to a deprivation of property without due process of law. They further allege that the AFP failed to observe these requirements, thus causing the reservation to be ineffectual. Petitioner, however, argues that the Public Land Act does not require a judicial order to create a military reservation. It contends that the proviso requiring the reservation to be subject to private rights means that persons claiming rights over the reserved land are not precluded from proving their claims. It contends further that respondents were afforded due process when their application for registration of title to Lot 4318 was heard by the lower courts. We agree with petitioner. The segregation of land for a public purpose is governed by the Public Land Act, the pertinent provisions of which are as follows: SECTION 83. Upon the recommendation of the Secretary of Agriculture and Natural Resources, the President may designate by proclamation any tract or tracts of land of the public domain as reservations for the use of the Republic of the Philippines or of any of its branches, or of the inhabitants thereof, in accordance with regulations

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prescribed for this purposes, or for quasi-public uses or purposes when the public interest requires it, including reservations for highways, rights of way for railroads, hydraulic power sites, irrigation systems, communal pastures or leguas comunales, public parks, public quarries, public fishponds, workingmen's village and other improvements for the public benefit. SECTION 86. A certified copy of every proclamation of the President issued under the provisions of this title shall be forwarded to the Director of Lands for record in his office, and a copy of this record shall be forwarded to the Register of Deeds of the province or city where the land lies. Upon receipt of such certified copy, the Director of Lands shall order the immediate survey of the proposed reservation if the land has not yet been surveyed, and as soon as the plat has been completed, he shall proceed in accordance with the next following section. SECTION 87. If all the lands included in the proclamation of the President are not registered under the Land Registration Act, the Solicitor General, if requested to do so by the Secretary of Agriculture and Natural Resources, shall proceed in accordance with the provision of Section fifty-three of this Act. SECTION 53. It shall be lawful for the Director of Lands, whenever in the opinion of the President the public interests shall require it, to cause to be filed in the proper Court of First Instance, through the Solicitor General or the officer acting in his stead, a petition against the holder, claimant, possessor, or occupant of any land who shall not have voluntarily come in under the provisions of this chapter or of the Land Registration Act, stating in substance that the title of such holder, claimant, possessor, or occupant is open to discussion; or that the boundaries of any such land which has not been brought into court as aforesaid are open to question; or that it is advisable that the title to such lands be settled and adjudicated, and praying that the title to any such land or the boundaries thereof or the right to occupancy thereof be settled and adjudicated. The judicial proceedings under this section shall be in accordance with the laws on adjudication of title in cadastral proceedings. Clearly, under the above provisions, 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. Inapplicable is the ruling in Baloy v. CA[12] requiring, after due notice and hearing, a judicial declaration of reservation. The subject of

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the application for registration in Baloy was originally private land, as evidenced by a possessory information title issued in the applicants favor during the Spanish era. As will be explained shortly, Lot 4318 in the present case is unquestionably public land. The only issue is whether respondents have acquired title to the property. Moreover, the governing law in Baloy was Act 627.[13] Under the provisions of that law, the private character of the land shall be respected absent any court order declaring that the property has become public. In the case before us, Proc 265 was issued pursuant to Commonwealth Act (CA) No. 141. Accordingly, only a positive act of the President is required to create a government reservation. Verily, the Proclamation successfully segregated Lot 4318 as a military reservation. Consequently, respondents could not have validly occupied it in 1954, because it was considered inalienable[14] since its reservation in 1938. Respondents Period of Possession Notwithstanding the reservation in 1938 of Lot 4318 for military use, respondents maintain their entitlement to have it registered under their names. They allege that their predecessors-in-interest were already in adverse, open, peaceful and continuous possession of the property for over 30 years prior to 1938. Thus, they conclude that their imperfect title had already attached long before the issuance of the Proclamation segregating the land as a military reservation. We are not convinced. As a rule, the factual findings of the trial court, when affirmed by the appellate court, are conclusive and binding on this Court. To this rule, however, there are settled exceptions; for instance, when the judgment assailed is not supported by sufficient evidence or is based on a misapprehension of facts.[15] We find that these exceptions apply here. Land that has not been acquired from the government, either by purchase or by grant, belongs to the State as part of the public domain. [16] For this reason, imperfect titles to agricultural lands are subjected to rigorous scrutiny before judicial confirmation is granted.[17] In the same manner, persons claiming the protection of private rights in order to exclude their lands from military reservations must show by clear and convincing evidence that the pieces of property in question have been acquired by a legal method of acquiring public lands.[18] In granting respondents judicial confirmation of their imperfect title, the trial and the appellate courts gave much weight to the tax declarations presented by the former. However, while the tax declarations were issued under the names of respondents predecessors-in-interest, the earliest one presented was issued only in 1954.[19] The Director, Lands Management Bureau v. CA[20] held thus: x x x. Tax receipts and tax declarations are not incontrovertible evidence of ownership. They are mere

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indicia of [a] claim of ownership. In Director of Lands vs. Santiago: x x x [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.[21] In addition, the lower courts credited the alleged prior possession by Calixto and Rosendo Bacas, from whom respondents predecessors had purportedly bought the property. This alleged prior possession, though, was totally devoid of any supporting evidence on record. Respondents evidence hardly supported the conclusion that their predecessors-in-interest had been in possession of the land since time immemorial. Moreover, as correctly observed by the Office of the Solicitor General, the evidence on record merely established the transfer of the property from Calixto Bacas to Nazaria Bombeo. The evidence did not show the nature and the period of the alleged possession by Calixto and Rosendo Bacas. It is important that applicants for judicial confirmation of imperfect titles must present specific acts of ownership to substantiate their claims; they cannot simply offer general statements that are mere conclusions of law rather than factual evidence of possession.[22] It must be stressed that respondents, as applicants, have the burden of proving that they have an imperfect title to Lot 4318. Even the absence of opposition from the government does not relieve them of this burden.[23] Thus, it was erroneous for the trial and the appellate courts to hold that the failure of the government to dislodge respondents, judicially or extrajudicially, from the subject land since 1954 already amounted to a title. In this connection, the Court reiterates the following ruling in Director of Lands v. Agustin:[24] x x x. The petitioner is not necessarily entitled to have the land registered under the Torrens system simply because no one appears to oppose his title and to oppose the registration of his land. He must show, even though there is no opposition, to the satisfaction of the court, that he is the absolute owner, in fee simple. Courts are not justified in registering property under the Torrens system, simply because there is no opposition offered. Courts may, even in the absence of any opposition, deny the registration of the land under the Torrens system, upon the ground that the facts presented did not show that the petitioner is the owner,

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in fee simple, of the land which he is attempting to have registered. WHEREFORE, the Petition is GRANTED, and the assailed Decision of the Court of Appeals is REVERSED and SET ASIDE. The segregation of Lot 4318 as part of a military reservation is declared VALID. No pronouncement as to costs.

SECOND DIVISION [G.R. No. 126316. June 25, 2004] REPUBLIC OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS, HON. JOSE D. AZARRAGA AND ANGEL T. YU, respondents. DECISION CALLEJO, SR., J.: This is a petition for review on certiorari of the Decision of the Court of Appeals dismissing the petition for annulment of judgment filed before it by the petitioner. The antecedent facts are as follows: On June 22, 1994, respondent Angel T. Yu filed a petition for registration of a parcel of land, designated as Lot 524, Cad. 633-D, Estancia Cadastre, Ap-063019-005139, with an area of 1,194 square meters, more or less, situated at the Poblacion, Zone 1, Municipality of Estancia, Province of Iloilo. The case was docketed as LRC Case No.1000, LRA Rec. No. N-64463 and raffled to the Regional Trial Court, Sixth Judicial Region, Iloilo City, Branch 37. The petition was later amended to include the adjoining lots and the corresponding owners name. Initial hearing was scheduled on February 9, 1995 at 8:30 a.m. For the purpose, the Office of the Solicitor General (OSG) entered its appearance on January 18, 1995 and at the same time deputized the City Prosecutor of Iloilo City to appear for and in behalf of the Solicitor General under the latters supervision and control. Except for the opposition filed by the Solicitor General, no one else appeared to oppose the application/petition. The case was then set for reception of applicants evidence on February 16, 1995 which was again set to another day. On February 22, 1995, the RTC received a letter from the Land Registration Authority (LRA) requesting the court to require the Land Management Bureau, Manila and the Community Environment and Natural Resources Office (CENRO) at Barotac Viejo, Iloilo to report on

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the status of the subject land considering that a discrepancy was noted after plotting the land. Thus, on March 6, 1995, the RTC issued an Order to the effect. On March 31, 1995, the RTC received a certification from the Land Management Bureau, Department of Environment and Natural Resources (DENR), Manila stating that according to the verification of our records, this Office (formerly Bureau of Lands) has no record of any kind of public land application/land patent covering the parcel of land situated in Estancia, Iloilo, identified as Lot No. 524, Cad. 633-D, Ap063019-005139, Based on this certification and after reception of evidence, the RTC rendered judgment on May 3, 1995, the decretal portion of which reads: WHEREFORE, ratifying the Order of general default previously entered in this case, and after considering the evidence adduced and finding that petitioner Angel T. Yu had sufficient title proper for the registration in his name of the land subject of the application, JUDGMENT is hereby rendered confirming the title of the applicant/petitioner ANGEL T. YU, Filipino, of legal age, married and a resident of Estancia, Iloilo, over a parcel of land (Lot 524, Cad. 633-D, Estancia Cadastre, AP-063019005139) situated in the Poblacion Zone 1, Municipality of Estancia, Province of Iloilo, Island of Panay, identified in the Plan, Exhibit E and technically described in Exhibit F. As soon as this Decision becomes final, let an order for the issuance of the permanent decree and the corresponding certificate of title be issued in accordance with law. No motion for reconsideration was filed by the City Prosecutor on behalf of the Solicitor General. Hence, the said decision became final and executory on June 14, 1995, and entry of judgment was duly made on July 7, 1995. An order was consequently issued by the RTC directing the issuance of the corresponding decree of registration and certificate of title to respondent Angel T. Yu. On May 29, 1995, the OSG received a copy of the supplementary report and findings of Land Management Officer Myra B. Rosal dated April 12, 1995 (Rosal Report), which was submitted to the trial court in compliance with the courts Order dated March 6, 1995. The report was worded, thus: The Honorable Judge JOSE AZARRAGA Regional Trial Court Sixth Judicial Region Branch 37, Iloilo City April 12, 1995 SUBJECT: LAND REGISTRATION CASE NO. N-1000 LOT NO. 524, CAD, CAD-633-D, ESTANCIA CADASTRE

Page 41 of 66

ANGEL TILOS YU APPLICANT ___________________________________ In compliance with the Order of March 6, 1995, received by this Office on March 15, 1995, attached for your ready reference is the amended report in three (3) pages of Land Management Officer III Fabio O. Catalan, Jr., of this Office, which was sent to Office of the Regional Technical Director, Land Management Bureau, DENR Masonic Temple, Iloilo City, in a cover memorandum dated September 24, 1994, duly endorsed by the CENR Officer of CENRO, Sara, Iloilo, Edgardo J. Himatay. This supplementary report of the undersigned is prepared with the request that the additional findings be made on record when the undersigned repaired on the premises of the land on April 7, 1995, in the morning to conduct an ocular inspection. The following facts were ascertained and found; 1. [That] the Cadastral lot in question and subject of a Land Registration Case at bar, is Lot 524, Cad 633-D, Estancia Cadastre, containing an area of 1,194 square meters, approved on October 21, 1980, located at Zone 1, Poblacion Estancia, Iloilo. Again, Engr. Rogelio Santome, adopting the cadastral survey of the then Bureau of Lands, prepared an Advance Plan and subsequently approved as Ap-063019005139 on May 25, 1994. That Lot No. 524, Cad-633-D is covered by a Foreshore Lease Application (FLA No. (VI-I)78) applied for by Angel Tilos Yu on July 1, 1977, with the then Bureau of Lands, MNR, Ministry of Natural Resources, NRD (VI-7) Barotac Viejo, duly ratified by Land Investigator Antonio L. Luis. An amount of P775.00 each had been paid in the year 1982 and the year 1983, (please see certification hereto attached) dated February 6, 1995, of CENR Officer Edgardo J. Himatay. That Lot No. 524, Cad-633-D is declared public land and is Alienable and Disposable per L.C. Map 1020, Project 44 dated July 26, 1933. That the improvements found on the land are as follows: a) A commercial complex built of strong materials (concrete steel and galvanized iron with 18-20 feet structure in depth, as foundation of the building, occupying around 600 square meters of the whole area of Lot 524. The building itself houses 14 commercial concrete stalls of 14 x 5 meters which is offered for rent as boutiques and dry goods stalls. On the second floor now undergoing are bowling lanes (6 alleys) for recreational purposes which will soon open to the public in 3 months time.

2.

3.

4.

b)

5.

That Lot No. 524, Cad-633-D is not an agricultural land. That out of the total area of 1,194 square meters, only

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around 850 square meters is dry land and that an area of 334 sq. meters which used to be covered and uncovered by water during high tide is now a reclaimed area, since way back 1977 when applicant Angel Tilos Yu applied for a Foreshore Lease Application with [the] then Bureau of Lands. Respectfully submitted, (signed) MYRA B. ROSAL On June 22, 1995, the OSG received a letter from Regional Executive Director Jose P. Catus of the DENR, stating that an investigation was conducted on the instant case, and it was found that there were grounds for opposition to the respondents land application. Land Investigator Fabio O. Catalan, Jr., who conducted an ocular inspection of the subject land, found the same to be a reclaimed foreshore area. Attached therein was the Amended Report of Land Investigator Catalan, Jr.(Catalan Report); the 1977 Foreshore Lease Application of Angel T. Yu; the November 16, 1983 Visitation and Examination Report of Land Investigator Antonio L. Luis over Lot No. 524; and a blueprint plan of Lot 524 (formerly Lot 2) of the Estancia Cadastre. After discovering the actual status of Lot 524, the Republic filed a petition for the annulment of judgment with a prayer for a writ of preliminary injunction with the Court of Appeals on July 20, 1995. On February 5, 1996, respondent Angel T. Yu filed a motion with the CA, praying that he be allowed to submit to the Land Registration Authority the corrected technical description and the republication in the Official Gazette of the corrected technical description of Plan Ap-063019, Lot 524, Cad. 633-D dated January 15, 1996. The OSG filed its objection thereto. On September 10, 1996, the Court of Appeals dismissed the petition for annulment of judgment. It also ruled that since the RTC decision had already become final and executory, the technical description could no longer be modified to include the increased area as prayed for by the private respondent. The CA held as follows: Lot 524 is not a foreshore land.. The CENRO report is proof that Lot 524, Cad-633-D, is an agricultural land. Out of the total area of 1,194 square meters, around 850 square meters is dry land. That an area of 334 sq. meters which used to be covered and uncovered by water during high tide is now a reclaimed area, since way back 1977.(underlining supplied) WHEREFORE, the petition for annulment of judgment is hereby DISMISSED. The motion of private respondent dated January 15, 1996 is DENIED.

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Finding no relief from the CA, the Republic filed the instant petition, raising the issue that: THE COURT OF APPEALS ERRED IN DENYING THE REPUBLICS PETITION FOR ANNULMENT OF JUDGMENT ON THE MERE SUPPOSITION THAT LOT 524 IS NOT FORESHORE LAND, BUT AGRICULTURAL LAND. We find merit in the petition. At the outset, there is a need to take a closer look at the true nature of the land in question. The petitioner asserts that Lot 524 is foreshore land. Foreshore land is that strip of land that lies between the high and low water marks and is alternatively wet and dry according to the flow of tide. It is that part of the land adjacent to the sea, which is alternately covered and left dry by the ordinary flow of tides. It is part of the alienable land of the public domain and may be disposed of only by lease and not otherwise. Foreshore land remains part of the public domain and is outside the commerce of man. It is not capable of private appropriation. It is for this reason that the petitioner persists in its action to revert the subject land to the State. Thus, even if the decision of the RTC has become final and executory, we find that the respondent court abused its discretion in dismissing the petition for annulment of judgment filed before it which is impressed with public interest. There are valid and meritorious grounds to justify such action. The State has to protect its interests and can not be bound by, or estopped from, the mistakes or negligent acts of its officials or agents, much more, non-suited as a result thereof. As held in Republic vs. Alagad: [T]he state as a persona in law is the judicial entity, which is the source of any asserted right to ownership in land under the basic doctrine embodied in the 1935 Constitution as well as the present charter. It is charged moreover with the conservation of such patrimony. There is need therefore of the most rigorous scrutiny before private claims to portions thereof are judicially accorded recognition, especially so where the matter is sought to be raked up anew after almost fifty years. Such primordial consideration, not the apparent carelessness, much less the acquiescence of public officials, is the controlling norm The Catalan Report, which states that the subject land is foreshore land, was received by the OSG only on June 22, 1995, long after the RTC rendered its judgment on May 3, 1995. Angel T. Yu had, in fact, filed a foreshore lease application in 1977 and paid the corresponding fees thereon. There is, therefore, doubt to the respondents claim that he had been in actual, open, notorious, continuous possession , in the concept of an owner. Moreover, the Rosal Report dated April 12, 1995 was received by the OSG only on May 29, 1995. Although the report states that Lot No. 524,

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Cad-633-D is declared public land and is alienable and disposable per L.C. Map 1020, Project 44 dated July 26, 1933, the same report buttresses the contention that the subject land is foreshore land and covered by a foreshore lease application filed by Angel T. Yu. Finding the reports to be revealing and significant as to the real status of the land being foreshore, the petitioner lost no time in filing the petition for annulment of judgment with the Court of Appeals. We can not fault the trial court for not having considered in its decision the Rosal Report dated April 12, 1995 which was apparently submitted to it. On March 15, 1995, the trial court issued an order where it considered the case submitted for decision upon the submission to this court by the Land Management Bureau, Manila and CENRO, Barotac Viejo, Iloilo of the report as directed in the Order of this Court dated March 6, 1995, and after the Land Management Sector, Region 6, Iloilo City had duly verified the discrepancy of plan Ap-063019-005139 of the subject land applied for. In compliance with the order, the trial court received a certification from the Land Management Bureau that the office has no record of any kind of public land application/land patent covering the parcel of land and thereby approved the registration of the land in favor of respondent. The records reveal that the Rosal Report, through a 1st Indorsement dated April 24, 1995, was received by the RTC only on May 5, 1995, after the court had already rendered its decision on May 3, 1995. No motion for reconsideration was filed to controvert the said decision based on the report. The OSGs receipt of the Rosal and Catalan Reports on the status of the land were also belated through no fault of theirs. Finally, we can not uphold the respondent courts finding regarding the character of the land. The Rosal Report clearly states that the subject land is not an agricultural land. Despite such declaration, the respondent court continued to rule that the subject land is agricultural on the basis that out of the total area of 1,194 square meters, 850 square meters is dry land and that 334 square meters is now a reclaimed area. Clearly, there is a need to determine once and for all whether the subject land is really foreshore land and/or whether the respondent has registerable title thereto. The classification of public lands is a function of the executive branch of government, specifically, the director of lands (now the director of the Land Management Bureau). This Court is not a trier of facts. Thus, for a proper and conclusive classification of the land involved, the instant case has to be remanded to the trial court for that determination. WHEREFORE, the petition is GRANTED. The Decisions of the Court of Appeals and the Regional Trial Court are REVERSED and SET ASIDE. The case is REMANDED to the Regional Trial Court, Iloilo City, Branch 37 for further proceedings. SO ORDERED.

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FIRST DIVISION ROGELIO, GEORGE, LOLITA, ROSALINDA, and JOSEPHINE, all surnamed PASIO, represented by their father and attorney-in-fact JOSE PASIO, Petitioners, - versus DR. TEOFILO EDUARDO F. MONTERROYO, substituted by ROMUALDO MONTERROYO, MARIA TERESA MONTERROYO, and STEPHEN MONTERROYO, Respondents. G.R. No. 159494 Present: PUNO, C.J., Chairperson, CARPIO, AUSTRIA-MARTINEZ,* CORONA, and LEONARDO-DE CASTRO, JJ.

Promulgated: July 31, 2008

x- - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - x DECISION CARPIO, J.: The Case Before the Court is a petition for review assailing the 31 January 2003 Decision and the 5 August 2003 Resolution of the Court of Appeals in CA-G.R. CV No. 63199. The Court of Appeals affirmed the Decision dated 2 February 1999 of the Regional Trial Court of Iligan City, Branch 6 (trial court), in Civil Case No. 06-3060. The Antecedent Facts This case originated from an action for recovery of possession and damages, with prayer for the issuance of a temporary restraining order or writ of preliminary mandatory injunction, filed by Rogelio, George, Lolita, Rosalinda and Josephine, all surnamed Pasio, represented by their father and attorney-in-fact Jose Pasio (petitioners) against Dr. Teofilo Eduardo F. Monterroyo (Dr. Monterroyo), later substituted by his heirs Romualdo, Maria Teresa and Stephen, all surnamed Monterroyo (respondents).

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Cad. Lot No. 2139 of Cad. 292, Iligan Cadastre (Lot No. 2139), with an area of 19,979 square meters, located at Panul-iran, Abuno, Iligan City, was part of a 24-hectare land occupied, cultivated and cleared by Laureano Pasio (Laureano) in 1933. The 24-hectare land formed part of the public domain which was later declared alienable and disposable. On 18 February 1935, Laureano filed a homestead application over the entire 24-hectare land under Homestead Application No. 205845. On 22 April 1940, the Bureau of Forestry wrote Laureano and informed him that the tract of land covered by his application was not needed for forest purposes. On 11 September 1941, the Director of Lands issued an Order approving Laureanos homestead application and stating that Homestead Entry No. 154651 was recorded in his name for the land applied for by him. Laureano died on 24 March 1950. On 15 April 1952, the Director of Lands issued an Order for the issuance of a homestead patent in favor of Laureano, married to Graciana Herbito (Graciana). Laureanos heirs did not receive the order and consequently, the land was not registered under Laureanos name or under that of his heirs. In 1953, the property was covered by Tax Declaration No. 11102 in the name of Laureano with Graciana as administrator. Between 1949 and 1954, a Cadastral Survey was conducted in Iligan City. The surveyor found that a small creek divided the 24hectare parcel of land into two portions, identified as Lot No. 2138 and Lot No. 2139. Petitioners claimed that Laureanos heirs, headed by his son Jose, continuously possessed and cultivated both lots. On 16 October 1962, Joses co-heirs executed a Deed of Quitclaim renouncing their rights and interest over the land in favor of Jose. Jose secured a title in his name for Lot No. 2138. Later, Jose alienated Lot No. 2139 in favor of his children (petitioners in this case) who, on 8 January 1994, simultaneously filed applications for grant of Free Patent Titles over their respective shares of Lot No. 2139 before the Land Management Bureau of the Department of Environment and Natural Resources (DENR). On 22 August 1994, the DENR granted petitioners applications and issued Original Certificate of Title (OCT) No. P-1322 (a.f.) in favor of Rogelio Pasio, OCT No. P-1318 (a.f.) in favor of George Pasio, OCT No. P-1317 (a.f.) in favor of Lolita Pasio, OCT No. P-1321 (a.f.) in favor of Josephine Pasio, and OCT No. P-1319 (a.f.) in favor of Rosalinda Pasio. Petitioners alleged that their possession of Lot No. 2139 was interrupted on 3 January 1993 when respondents forcibly took possession of the property. Respondents alleged that they had been in open, continuous, exclusive and notorious possession of Lot No. 2139, by themselves and through their predecessors-in-interest, since 10 July 1949. They alleged that on 10 July 1949, Rufo Larumbe (Larumbe) sold Lot No. 2139 to Petra Teves (Petra). On 27 February 1984, Petra executed a deed of sale over Lot No. 2139 in favor of Vicente Teves (Vicente). On 20 February 1985, Vicente executed a pacto de retro sale over the land in favor of Arturo Teves (Arturo). In 1992, Arturo sold Lot No. 2139 in favor of respondents father, Dr. Monterroyo, by virtue of an oral contract. On

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5 January 1995, Arturo executed a Deed of Confirmation of Absolute Sale of Unregistered Land in favor of Dr. Monterroyos heirs. Respondents alleged that Jose was not the owner of Lot No. 2139 and as such, he could not sell the land to his children. They alleged that petitioners OCTs were null and void for having been procured in violation of the Public Land Act. They further alleged that the Land Management Bureau had no authority to issue the free patent titles because Lot No. 2139 was a private land. The Ruling of the Trial Court In its 2 February 1999 Decision, the trial court ruled, as follows: WHEREFORE, judgment is rendered in favor of all the defendants and against the plaintiffs: 1. Dismissing the complaint;

2. Declaring Lot No. 2139, Iligan Cadastre 292, located at Panul-iran, Abuno, Iligan City to have acquired the character of a private land over which the Land Management Bureau has been divested of jurisdiction; 3. Declaring the defendants to be the owners and possessors of the said lot; 4. Declaring OCT Nos. P-1322 (a.f.) of Rogelio Pasio, P-1318 (a.f.) of George Pasio, P-1317 (a.f.) of Lolita Pasio, P-1321 (a.f.) of Josephine Pasio and P-1319 (a.f.) of Rosalinda Pasio to be null and void for having been procured by fraud and for having been issued by the Land Management Bureau which has been divested of jurisdiction over said lot; 5. Declaring the defendants to be entitled to the sum of P6,000.00 deposited with the Office of the Clerk of Court under O.R. No. 1487777; 6. Dismissing the defendants counterclaim for attorneys fees. Costs against the plaintiffs. SO ORDERED. The trial court ruled that as of January 1994, Lot No. 2139 had already acquired the character of a private land by operation of law. Since Lot No. 2139 had already ceased to be a public land, the Land

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Management Bureau had no power or authority to dispose of it by issuing free patent titles. The trial court ruled that respondents counterclaim stands on the same footing as an independent action. Thus, it could not be considered a collateral attack on petitioners titles. The trial court further ruled that respondents filed their counterclaim within one year from the grant of petitioners titles, which was the reglementary period for impugning a title. The trial court ruled that the order for the issuance of a patent in favor of Laureano lapsed and became functus officio when it was not registered with the Director of Deeds. The trial court ruled that while Laureano was the original claimant of the entire 24 hectares, he ceded the right to possession over half of the property, denominated as Lot No. 2139, to Larumbe sometime in 1947. The trial court found that Laureano offered to sell half of the land to his tenant Gavino Quinaquin (Gavino) but he did not have money. Later, Gavino learned from Larumbe that he (Larumbe) acquired half of the land from Laureano. Gavino then started delivering the owners share of the harvest to Larumbe. Laureano never contested Gavinos action nor did he demand that Gavino deliver to him the owners share of the harvest and not to Larumbe. When Lot No. 2139 was sold, Gavino and his successors delivered the owners share of the harvest to Petra, Vicente, Arturo, Dr. Monterroyo, and Dindo Monterroyo, successively. The trial court also found that the other tenants had never given any share of the harvest to Jose. The trial court ruled that petitioners had failed to present convincing evidence that they and their predecessors-in-interest were in possession of Lot No. 2139 from 1947 to 1994 when they filed their application for free patent. The trial court ruled that petitioners committed actual fraud when they misrepresented in their free patent applications that they were in possession of the property continuously and publicly. Petitioners appealed from the trial courts Decision. The Ruling of the Court of Appeals In its 31 January 2003 Decision, the Court of Appeals affirmed the trial courts Decision. The Court of Appeals ruled that the trial court did not err in allowing respondents counterclaim despite the non-appearance of Dr. Monterroyo, the original defendant, at the barangay conciliation proceedings. The Court of Appeals ruled that petitioners themselves did not personally appear. They were represented by their attorney-in-fact although they were all of legal age, which was a violation of the Katarungang Pambarangay proceedings requiring the personal appearance of the parties. Hence, the Court of Appeals ruled that there was never a valid conciliation proceeding. However, while this would have been a ground for the dismissal of the complaint, the issue was

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deemed waived because respondents did not raise it in their answer before the trial court. The Court of Appeals ruled that the validity of petitioners titles could be attacked in a counterclaim. The Court of Appeals ruled that respondents counterclaim was a compulsory counterclaim. The Court of Appeals sustained the trial courts ruling that the Land Management Bureau had been divested of jurisdiction to grant the patent because the land already acquired the character of a private land. While the homestead patent was issued in favor of Laureano, the issuance of patent order became functus officio when it was not registered. The Court of Appeals further sustained the trial courts finding that respondents were in physical, open, public, adverse and continuous possession of Lot No. 2139 in the concept of owner for at least 30 years prior to petitioners application for free patent titles over the land. Petitioners filed a motion for reconsideration. In its 5 August 2003 Resolution, the Court of Appeals denied petitioners motion for reconsideration. Hence, the petition before this Court. The Issue Petitioners raised the sole issue of whether the Court of Appeals erred in sustaining the trial courts Decision declaring respondents as the rightful owners and possessors of Lot No. 2139. The Ruling of this Court The petition has no merit. Land Management Bureau Had No Jurisdiction To Issue Free Patent Titles In Director of Lands v. IAC, the Court ruled: [A]lienable public land held by a possessor, continuously or through his predecessors-in-interest, openly, continuously and exclusively for the prescribed statutory period (30 years under The Public Land Act, as amended) is converted to private property by the mere lapse or completion of the period, ipso jure. In Magistrado v. Esplana, the Court ruled that so long as there is a clear showing of open, continuous, exclusive and notorious possession,

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and hence, a registrable possession, by present or previous occupants, by any proof that would be competent and admissible, the property must be considered to be private. In this case, the trial court found that the preponderance of evidence favors respondents as the possessors of Lot No. 2139 for over 30 years, by themselves and through their predecessors-in-interest. The question of who between petitioners and respondents had prior possession of the property is a factual question whose resolution is the function of the lower courts. When the factual findings of both the trial court and the Court of Appeals are supported by substantial evidence, they are conclusive and binding on the parties and are not reviewable by this Court. While the rule is subject to exceptions, no exception exists in this case. Respondents were able to present the original Deed of Absolute Sale, dated 10 July 1949, executed by Larumbe in favor of Petra. Respondents also presented the succeeding Deeds of Sale showing the transfer of Lot No. 2139 from Petra to Vicente and from Vicente to Arturo and the Deed of Confirmation of Absolute Sale of Unregistered Real Property executed by Arturo in favor of respondents. Respondents also presented a certification executed by P/Sr. Superintendent Julmunier Akbar Jubail, City Director of Iligan City Police Command and verified from the Log Book records by Senior Police Officer Betty Dalongenes Mab-Abo confirming that Andres Quinaquin made a report that Jose, Rogelio and Luciana Pasio, Lucino Pelarion and Nando Avilo forcibly took his copra. This belied petitioners allegation that they were in possession of Lot No. 2139 and respondents forcibly took possession of the property only in January 1993. Considering that petitioners application for free patent titles was filed only on 8 January 1994, when Lot No. 2139 had already become private land ipso jure, the Land Management Bureau had no jurisdiction to entertain petitioners application. Non-Registration of Homestead Patent Rendered it Functus Officio Once a homestead patent granted in accordance with law is registered, the certificate of title issued by virtue of the patent has the force and effect of a Torrens title issued under the land registration law. In this case, the issuance of a homestead patent in 1952 in favor of Laureano was not registered. Section 103 of Presidential Decree No. 1529 mandates the registration of patents, and registration is the operative act to convey the land to the patentee, thus: Sec. 103. x x x x. The deed, grant, patent or instrument of conveyance from the Government to the grantee shall not take effect as a conveyance or bind the land but shall operate only as a contract between the Government and the grantee and as evidence of authority to the Register of Deeds to make registration. It is the act of registration that shall be the operative act to affect

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and convey the land, and in all cases under this Decree, registration shall be made in the office of the Register of Deeds of the province or city where the land lies. The fees for registration shall be paid by the grantee. After due registration and issuance of the certificate of title, such land shall be deemed to be registered land to all intents and purposes under this Decree. (Emphasis supplied) Further, in this case, Laureano already conveyed Lot No. 2139 to Larumbe in 1947 before the approval of his homestead application. In fact, Larumbe already sold the land to Petra in 1949, three years before the issuance of the homestead patent in favor of Laureano. The trial court found that since 1947, the tenants of Lot No. 2139 had been delivering the owners share of the harvest, successively, to Larumbe, Petra, Vicente and Arturo Teves, Dr. Monterroyo and Dindo Monterroyo. The trial court found no instance when the owners share of the harvest was delivered to Jose Pasio. Hence, we sustain the trial court that the non-registration of Laureanos homestead patent had rendered it functus officio. A Counterclaim is Not a Collateral Attack on the Title It is already settled that a counterclaim is considered an original complaint and as such, the attack on the title in a case originally for recovery of possession cannot be considered as a collateral attack on the title. Development Bank of the Philippines v. Court of Appeals is similar to the case before us insofar as petitioner in that case filed an action for recovery of possession against respondent who, in turn, filed a counterclaim claiming ownership of the land. In that case, the Court ruled: Nor is there any obstacle to the determination of the validity of TCT No. 10101. It is true that the indefeasibility of torrens title cannot be collaterally attacked. In the instant case, the original complaint is for recovery of possession filed by petitioner against private respondent, not an original action filed by the latter to question the validity of TCT No. 10101 on which petitioner bases its right. To rule on the issue of validity in a case for recovery of possession is tantamount to a collateral attack. However, it should not [b]e overlooked that private respondent filed a counterclaim against petitioner, claiming ownership over the land and seeking damages. Hence, we could rule on the question of the validity of TCT No. 10101 for the counterclaim can be considered a direct attack on the same. A counterclaim is considered a complaint, only this time, it is the original defendant who becomes the plaintiff... It stands on the same footing and is to be tested by the same rules as if it were an independent action. x x x.

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As such, we sustain both the trial court and the Court of Appeals on this issue. Principle of Constructive Trust Applies Under the principle of constructive trust, registration of property by one person in his name, whether by mistake or fraud, the real owner being another person, impresses upon the title so acquired the character of a constructive trust for the real owner, which would justify an action for reconveyance. In the action for reconveyance, the decree of registration is respected as incontrovertible but what is sought instead is the transfer of the property wrongfully or erroneously registered in anothers name to its rightful owner or to one with a better right. If the registration of the land is fraudulent, the person in whose name the land is registered holds it as a mere trustee, and the real owner is entitled to file an action for reconveyance of the property. In the case before us, respondents were able to establish that they have a better right to Lot No. 2139 since they had long been in possession of the property in the concept of owners, by themselves and through their predecessors-in-interest. Hence, despite the irrevocability of the Torrens titles issued in their names and even if they are already the registered owners under the Torrens system, petitioners may still be compelled under the law to reconvey the property to respondents. WHEREFORE, we DENY the petition. We AFFIRM the 31 January 2003 Decision and the 5 August 2003 Resolution of the Court of Appeals in CA-G.R. CV No. 63199. Costs against petitioners.

FIRST DIVISION [G.R. No. 127060. November 19, 2002] REPUBLIC OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS, FLORENTINO CENIZA, SANTIAGO CENIZA, ESTANISLAO CENIZA, ROMEO SIMBAJON, PABLO RAMOS, ATILANO BONGO, EDGAR ADOLFO, EMMA ADOLFO, JERRY ADOLFO, GLENN ADOLFO, GINA ADOLFO, LORNA ADOLFO, CHONA ADOLFO, EVELYN ADOLFO, in her own behalf and as guardian of the minors HUBERT and AMIEL ADOLFO, and ELNITA ADOLFO in her own behalf and as guardian of minors DAVID and PRESTINE MAY ADOLFO, respondents. DECISION YNARES-SANTIAGO, J.:

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This is a petition for review on certiorari of the decision dated September 28, 1994, of the Court of Appeals in CA-G.R. CV No. 31728, affirming the decision in LRC Case No. N-46 of the Regional Trial Court in Mandaue City, Branch XXVIII, which declared private respondents as the owners entitled to the registration of the lots in question. The antecedent facts of the case are as follows: Apolinar Ceniza was the declared owner in 1948 of Lot No. 1104, located at Cabancalan, Mandaue City, under Tax Declaration No. 01686. When he died, his heirs took possession of the property and in 1960 partitioned the same through a deed of extrajudicial partition. Apolinars children, namely, Santiago, Estanislao, Florencia, Manuela, Mercedes and Florentino, all surnamed Ceniza, each got 1/8 share of the property. His grandchildren, namely, the siblings Remedios Adolfo, Melecio Ceniza, and Constancia Zanoria, each got 1/24 share, while Apolinars other grandchildren, namely, the siblings Concepcion Suico, Benjamin Ceniza, Lilia Ceniza and Delfin Ceniza, each got 1/32 share. Private respondent Florentino Ceniza purchased the shares of his sisters Manuela and Mercedes and the share pertaining to the siblings Jesusa, Benjamin and Delfin. Together with his share, Florentino became the owner of Lot Nos. 1104-A&C and had them tax declared in his name. Florencias share, a portion of Lot No. 1104-B, was purchased by Mercedes who in turn bartered the same with the share acquired by Santiago, another private respondent in this case. A portion of Santiagos property was bought by his daughter, Asuncion Ceniza, married to private respondent Atillano Bongo and who successfully obtained a tax declaration therefor. From the portion purchased by Asuncion Ceniza, another private respondent, Romeo Simbajon, purchased an area of 270 square meters. Romeo also acquired a tax declaration in his name. He was the husband of Felicitas Ceniza, another daughter of Santiago. The share acquired by Estanislao, another child of Apolinar, was also a portion of Lot No. 1104-B. He also caused the tax declaration pertaining to the said lot transferred in his name. The siblings Remedios Adolfo and Constancia Zanoria, married to private respondent Pablo Ramos, bought the share of their brother, Melecio Ceniza. Remedios share, in turn, was transferred to her heirs, private respondents Edgar, Emma, Jerry, Glenn, Gina, Lorna, Chona, Evelyn, Hubert, Amiel, all surnamed Adolfo, and the heirs of their brother Leoncio Adolfo, namely, his wife Elenita Adolfo, and children David and Prestine May Adolfo. On November 4, 1986, private respondents applied for registration of their respective titles over the property they inherited from Apolinar Ceniza, with the Regional Trial Court of Mandaue City, Branch 28.

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Petitioner Republic of the Philippines, represented by the Office of the Solicitor General opposed the application on the following grounds: 1. That neither the applicant/s nor their precedessors-in-interest have been in open continuous exclusive and notorious possession and occupation of the land in question since June 12, 1945 or prior thereto (Sec. 48 [b], C.A. 141, as amended by P.D. 1073). 2. That the muniment/s or title and/or the tax declaration/s and tax payment/s receipt/s of applicant/s if any, attached to or alleged in the application, do/es not constitute competent and sufficient evidence of a bona fide acquisition of the lands applied for or of their open, continuous, exclusive and notorious possession and occupation thereof in the concept of owner, since June 12, 1945, or prior thereto. Said muniment/s of title do/es not appear to be genuine and the tax declaration/s and/or tax payment receipts indicate pretended possession of applicants to be of recent vintage. 3. That the claim of ownership in fee simple on the basis of Spanish title or grant can no longer be availed of by the applicants who have failed to file an appropriate application for registration within the period of six (6) months from February 16, 1976 as required by Presidential Decree No. 892. From the records, it appears that the instant application was filed on October 25, 1996. 4. That the parcel/s applied for is/are portions of the public domain belonging to the Republic of the Philippines not subject to private appropriation. In a decision dated February 28, 1990, the Regional Trial Court of Mandaue City granted the application. It held that since the applicants possession of the land for more than thirty (30) years was continuous, peaceful, adverse, public and to the exclusion of everybody, the same was in the concept of owners. Since the land was neither encumbered nor subject to any other application for registration, the trial court ordered that, upon the finality of its decision, the decrees of registration should be issued in favor of the applicants. The Solicitor General interposed an appeal for petitioner Republic of the Philippines before the Court of Appeals. In a decision dated September 28, 1994, the Court of Appeals affirmed the decision of the trial court. It held that the ruling in Director of Lands v. Court of Appeals, that before public land could be registered in the name of a private individual, it must first be established that the land had been classified alienable and disposable, refers to public lands and not to those which have acquired the nature of a private property in view of the continuous possession thereof by its claimants. The Court of Appeals held: In this case, it was sufficiently established by appellees that they have been in open, continuous, exclusive and notorious possession of the subject lots even before the year 1927, or fifty nine (59) years before the application was filed (TSN, April 13, 1989, pp. 3-4; February 6, 1989,

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p. 7-11; June 2, 1988, pp. 3, 8-9). This period more than sufficiently satisfies the 30 years requirement of the Public Land Act for property to be considered as private land. Significantly, Section 4, Presidential Decree No. 1073 provides: Sec. 4. The provisions of Section 48(b) and Section 4(c), Chapter VIII, of the Public Land Act are hereby amended in the sense that these provisions shall apply only to alienable and disposable lands of the public domain which have been in open, continuous, exclusive and notorious possession and occupation by the applicant himself or thru his predecessor-in-interest, under a bonafide claim of ownership, since June 12, 1945. Appellant was thus no longer required to prove that the property in question is classified as alienable and disposable land of the public domain. Clearly, the property no longer forms part of the public domain. The long and continuous possession thereof by appellees converted said property to a private one. This finds support in the ruling in Director of Lands vs. Bengzon, 152 SCRA 369, to wit: x x x alienable public land held by a possessor, personally or through his predecessor-in-interest, openly, continuously and exclusively for the prescribed statutory period (30) years under the Public Land Act, as amended is converted to private property by the mere lapse or completion of said period, ipso jure. The above is a reaffirmation of the principle established in the earlier cases of Cario v. Insular Government, Suzi v. Razon, and Herico v. Dar, that open exclusive and undisputed possession of alienable public land for the period prescribed by law creates the legal fiction whereby the land, upon completion of the requisite period ipso jure and without the need of judicial or other sanction, ceases to be public land and becomes private property. x x x In interpreting the provisions of Section 48 (b) of Commonwealth Act No. 141, this Court said in Herico v. Dar, x x x when the conditions as specified in the foregoing provision are complied with, the possessor is deemed to have acquired, by operation of law, a right to a grant, a government grant, without the necessity of a certificate of title being issued. The land, therefore, ceases to be of the public domain, and beyond the authority of the Director of Lands to dispose of. The application for confirmation is a mere formality, the lack of which does not affect the legal sufficiency of the title as would be evidenced by the patent and the torrens title to be issued upon the strength of the patent. The Court of Appeals then cited Director of Lands v. Intermediate Appellate Court. In that case, this Court ruled that alienable public land held by a possessor, personally or through his predecessors-in-interest, openly, continuously and exclusively for the prescribed statutory period (30 years under the Public Land Act, as amended) is converted to private property by the mere lapse or completion of said period, ipso jure. Moreover, appellant Republics claim that the property in question remains to be public land under the Constitution, is refuted by this Courts pronouncement in Director of Lands v. Intermediate Appellate Court that the Constitution cannot impair vested rights.

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The Court of Appeals concluded its decision with the following observations: Finally, we note that no opposition was filed by the Bureaus of Lands and Forestry to contest the application of appellees on the ground that the property still forms part of the public domain. Nor is there any showing that the lots in question are forestal land, unlike the case of Director of Lands vs. Court of Appeals, 133 SCRA 701, wherein the Director of Lands questioned the petition for registration filed by the applicant therein on the claim that the property applied for registration in his favor was classified and proven to be forestal land. Petitioner filed a motion for reconsideration, which was denied in a resolution dated October 29, 1996. Traversing petitioners argument that under Section 2, Article XII of the Constitution, all lands of the public domain are owned by the State, the Court of Appeals stated that said provision further states that agricultural lands are excluded from those lands that may not be alienated. It further ruled: In the instant case, among the documents presented by appellees are Real Estate tax receipts that sufficiently show that the subject land is mainly utilized for agricultural purposes devoted to the planting of coconut, corn x x x and sugar cane x x x aside from using the same for residential purposes x x x. It is noticeable that appellant failed to present any proof to establish its claim that the land in question is not alienable. Although on July 10, 1989, the court a quo issued an order directing the Bureau of Forest Development [BFD] to submit xx within thirty (30) days from its receipt of [said order] a report on the status of the land xx to determine whether said land or any portion thereof is within the forest zone xxx (Record, p. 63), the BFD failed to comply. Moreover, appellant never contested appellees application nor did it may (sic) any manifestation that the land in question is not alienable. Likewise, the prosecutor representing the Republic of the Philippines during the trial did not even contest the classification of the land as stated in the evidence of appellees. Their belated objection should therefore not prejudice appellees who openly and in good faith presented all the documents pertinent to their claims. Presidential Decree No. 1073 extended the period within which a qualified person may apply for confirmation of an imperfect or incomplete title by judicial legalization to December 31, 1987. The filing of this case in October, 1986 was therefore seasonable. Under the decree, this right is available to a person who has been in open, continuous, exclusive and notorious possession and occupation, by himself and through his predecessors-in-interest, under a bona fide claim of acquisition of ownership since June 12, 1945. We reiterate that appellees have proven themselves to have been in possession of the subject land even prior to June 12, 1945. Hence, this petition for review, alleging that the Court of Appeals erred in: (1) holding that private respondents have registerable title to the lots in question, and (2) ordering the registration thereof in their names.

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The issues raised before us are: (a) whether there is a need for private respondents to establish that the land subject of their application was alienable and disposable despite proofs showing their possession thereof for more than 30 years; and (b) whether private respondents were able to meet the period required by the Public Land Act, as amended. Petitioner contends that before a public land can be registered in the name of a private individual, it must be shown first that (a) the land has been classified alienable and disposable, and (b) the applicant, by himself or through his predecessors-in-interest, has been in continuous, exclusive and notorious possession and occupation of the same under a bona fide claim of ownership since June 12, 1945 or prior thereto. Petitioner claims that private respondents failed to meet the said requirements. They did not cite any official proclamation or presented the land classification map covering the subject parcels of land to prove that they are alienable and disposable public lands. Neither did private respondents adduce evidence to show that they had been in possession of the land since June 12, 1945. Although they were able to show possession by Apolinar, their predecessor-in-interest, since 1948, and private respondents actual possession beginning in 1960, no proof was presented to show possession prior to 1948. Consequently, private respondents are not entitled to have the subject parcels of land registered in their names. In their comment, private respondents cite Section 48(b), before it was amended by PD No. 1073, and Section (50) of the Public Land Act as the applicable law in this case. They maintain that the land subject of their application is an agricultural land devoted to corn and other root crops. Further, they have been in possession of the land since 1927. Estanislao Ceniza, one of the children of Apolinar and who was already ten years old at that time, testified that his father was the one in possession of the land, appropriating its fruits and paying its realty taxes. When their father died in 1947, Apolinars chidren took possession of the land. They also appropriated the fruits and paid realty taxes therefor. In 1960, Apolinars heirs partitioned the property, declared their respective shares in their names for tax purposes and paid the realty taxes. Apart from this, private respondents claim that the land in question has long been a private one, it being a part of Hacienda de Mandaue de Cebu, which in turn was recognized as a private land by the Court of First Instance of Cebu in several decisions dated February 27, 1934, March 27, 1935, May 6, 1937 and August 6, 1937. Indeed, before one can be granted a confirmation of title to lands of the public domain, the Public Land Act requires that the applicant must prove (a) that the land is alienable public land and (b) that his open, continuous, exclusive and notorious possession and occupation of the same must either be since time immemorial or for the period prescribed in the Public Land Act. Only when these conditions are met may the possessor of the land acquire, by operation of law, a right to a grant, a

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government grant, without the necessity of a certificate of title being issued. Conclusively, the Court of Appeals erred when it held that mere adverse possession in accordance with law for a period likewise provided for by law would automatically entitle the possessor to the right to register public land in his name. The applicant has to establish first the disposable and alienable character of the public land. Otherwise, all public lands, regardless of their classification, can be subject of registration of private titles, as long as the applicant shows that he meets the required years of possession. Worth noting is the case of Bracewell v. Court of Appeals, where the applicant had been in possession of the property since 1908 but it was conclusively shown by the government that the land was classified as alienable or disposable only on 27 March 1972. The Court said: x x x. Thus, even granting that petitioner and his predecessors-ininterest had occupied the same since 1908, he still cannot claim title thereto by virtue of such possession since the subject parcels of land were not yet alienable land at that time nor capable of private appropriation. The adverse possession which may be the basis of a grant of title or confirmation of an imperfect title refers only to alienable or disposable portions of the public domain. (Italics supplied) To prove that the land subject of an application for registration is alienable, an 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. In this case, private respondents presented a certification dated November 25, 1994, issued by Eduardo M. Inting, the Community Environment and Natural Resources Officer in the Department of Environment and Natural Resources Office in Cebu City, stating that the lots involved were found to be within the alienable and disposable (sic) Block-I, Land Classification Project No. 32-A, per map 2962 4-I555 dated December 9, 1980. This is sufficient evidence to show the real character of the land subject of private respondents application. Further, the certification enjoys a presumption of regularity in the absence of contradictory evidence, which is true in this case. Worth noting also was the observation of the Court of Appeals stating that: no opposition was filed by the Bureaus of Lands and Forestry to contest the application of appellees on the ground that the property still forms part of the public domain. Nor is there any showing that the lots in question are forestal land.... Thus, while the Court of Appeals erred in ruling that mere possession of public land for the period required by law would entitle its occupant to a confirmation of imperfect title, it did not err in ruling in favor of private respondents as far as the first requirement in Section 48(b) of the Public Land Act is concerned, for they were able to overcome the burden of proving the alienability of the land subject of their application.

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As correctly found by the Court of Appeals, private respondents were able to prove their open, continuous, exclusive and notorious possession of the subject land even before the year 1927. As a rule, we are bound by the factual findings of the Court of Appeals. Although there are exceptions, petitioner did not show that this is one of them. WHEREFORE, the petition for review on certiorari is DENIED and the decision, as well as the resolution, of the Court of Appeals in CA-G.R. CV No. 31728 are AFFIRMED. SO ORDERED.

FIRST DIVISION
REPUBLIC OF THE PHILIPPINES, Petitioner, Present:
PUNO, Chairperson, - versus CASTRO, JJ. RUBY LEE TSAI, Promulgated: C.J.,

G.R. No. 168184

QUISUMBING,*

CARPIO, CORONA, and LEONARDO-DE

Respondent. June 22, 2009 x---------------------------------------- - - - - - - - - - -x

DECISION
CARPIO, J.: The Case Before the Court is a petition for review assailing the 30 January 2004 Decision and 12 May 2005 Resolution of the Court of Appeals in CA G.R. CV No. 70006. The 30 January 2004 Decision affirmed the 21 September 1998 Decision of the Regional Trial Court of Tagaytay City, Branch 18 (trial court) in LRC Case No. TG-788 which approved the application

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of respondent Ruby Lee Tsai for the confirmation and registration of Lot No. 7062, described in plan Ap-04-010084, Cad-355, Tagaytay Cadastre, with an area of 888 square meters (subject property). The 12 May 2005 Resolution denied the motion for reconsideration of petitioner Republic of the Philippines (Republic). The Facts On 3 December 1996, respondent filed an application for the confirmation and registration of the subject property under Presidential Decree No. 1529 (PD 1529). Respondent alleged that she is the owner of the subject property and the improvements thereon. Respondent stated that on 31 May 1993, she purchased the subject property from Manolita Gonzales Vda. de Carungcong (Carungcong), through Wendy Mitsuko Sato, Carungcongs daughter and attorney in fact. Respondent declared that she and her predecessors-ininterest have been in open, continuous, exclusive and notorious possession and occupation of the subject property for more than 30 years. Except for the Republic, there were no other oppositors to the application. The Republic opposed respondents application on the following grounds: (1) that respondent and her predecessors-in-interest failed to present sufficient evidence to show that they have been in open, continuous, exclusive and notorious possession and occupation of the subject property since 12 June 1945 or earlier as required by Section 48(b) of Commonwealth Act No. 141 (CA 141), as amended by Presidential Decree No. 1073 (PD 1073); (2) that the tax declarations and tax receipt payments attached to the application do not constitute competent and sufficient evidence of a bona fide acquisition of the land applied for or of respondents open, continuous, exclusive and notorious possession and occupation of the subject property in the concept of an owner since 12 June 1945 or earlier; and (3) that the subject property forms part of the public domain and is not subject to private appropriation. After establishing the jurisdictional facts, respondent presented the following documents to support her application: 1. Deed of Absolute Sale dated 31 May 1993 between respondent and Carungcong;

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2. Tax Declarations corresponding to different years showing that the subject property has been declared under the name of Carungcong for tax purposes: Tax Declaration No. 02226-A for the year 1948, Tax Declaration No. 010158-A for the year 1960, Tax Declaration No. 013976-A for the year 1965, Tax Declaration No. 07209-B for the year 1974, Tax Declaration No. 016-0635 for the year 1980, Tax Declaration No. GR-016-0735 for the year 1985 and Tax Declaration No. GR-016-1610 for the year 1992; 3. Tax Declaration Nos. GR-016-1776-R and 0161084 for the year 1994 showing that the subject property has been declared under the name of respondent for tax purposes; 4. Official Receipts corresponding to different years showing the payment of real property taxes under the name of Carungcong: Official Receipt No. 4641772 dated 27 May 1991, Official Receipt No. 2326477 dated 10 December 1992, Official Receipt No. 0535585 dated 10 June 1992, Official Receipt No. 4879666 dated 28 May 1993 and Official Receipt No. 4879620 dated 3 June 1993; 5. Official Receipts corresponding to different years showing the payment of real property taxes under the name of respondent: Official Receipt No. 4997840 dated 10 January 1994, Official Receipt No. 7304615 dated 15 February 1995 and Official Receipt No. 9115050 dated 31 March 1997; and 6. Certification of the City Treasurer of Tagaytay City stating that the real property taxes for the years 1994 to 1997 were paid. On 21 September 1998, the trial court granted respondents application for registration. The dispositive portion states:
WHEREFORE, this court hereby approves this application for registration and thus places under the operation of Act 141, Act 496 and/or P.D. 1529, otherwise known as Property Registration Law, the land, Lot 7062 described in plan Ap-04010084, Cad-355, Tagaytay Cadastre, situated in the Brgy. of San Jose, City of Tagaytay, containing an area of Eight Hundred Eighty Eight (888) Square Meters in the name of RUBY LEE TSAI, married to Tsai Yu Lung, both of legal age and residents of Sun Valley Subdivision, Sta. Ana Drive, Paraaque, Metro Manila. Once this Decision becomes final and executory, the corresponding decree of registration shall forthwith issue.

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SO ORDERED.

The Republic appealed to the Court of Appeals on the ground that the trial court erred in granting the application for registration despite respondents failure to prove open, continuous, exclusive and notorious possession of the subject property since 12 June 1945 or earlier. According to the Republic, it is not sufficient that respondent proved possession of the subject property for more than 30 years. In the assailed 30 January 2004 Decision, the Court of Appeals affirmed the trial courts decision. The Republic filed a motion for reconsideration. The Court of Appeals denied Republics motion. Hence, this petition. The Ruling of the Regional Trial Court According to the trial court, respondent was able to establish her title and interest over the subject property. The trial court found that respondent and her predecessors-ininterest have been in actual possession of the subject property for more than 30 years. The trial court also declared that the subject property was residential and not within any forest zone or the public domain. The Ruling of the Court of Appeals The Court of Appeals affirmed the trial courts finding that respondent and her predecessors-in-interest have been in open, continuous, exclusive and notorious possession of the subject property in the concept of an owner for more than 30 years. According to the Court of Appeals, respondent need not prove that she and her predecessors-in-interest have been in possession of the subject property since 12 June 1945 or earlier because Section 48(b) of CA 141 was already superseded by Republic Act No. 1942 (RA 1942), which provides for a simple 30 year prescriptive period of occupation by an applicant for judicial confirmation of title. The Issue

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The Republic raises the sole issue of whether the trial court can grant the application for registration despite the lack of proof of respondents open, continuous, exclusive and notorious possession of the subject property since 12 June 1945 or earlier. The Courts Ruling The petition has merit. The Republic argues that respondent failed to present sufficient evidence to show that she and her predecessors-ininterest have been in open, continuous, exclusive and notorious possession of the subject property in the concept of an owner since 12 June 1945 or earlier. According to the Republic, respondent only proved possession since 1948, which is in violation of Section 48(b) of CA 141, as amended by PD 1073. On the other hand, respondent insists that it is sufficient that she proved that she and her predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of the subject property under a bona fide claim of ownership for more than 30 years. The Court notes that in respondents original application before the trial court, she claimed that she was entitled to the confirmation and registration of her title to the subject property under PD 1529. However, respondent did not specify under what paragraph of Section 14 of PD 1529 she was filing the application. But going over respondents application and the evidence she presented before the trial court, it appears that respondent filed her application under Section 14(1) of PD 1529, which states:
SEC. 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.(Emphasis supplied)

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Thus, there are three requisites for the filing of an application for registration of title under Section 14(1) of PD 1529: (1) that the property in question is alienable and disposable land of the public domain; (2) that the applicant by himself or through his predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation; and (3) that such possession is under a bona fide claim of ownership since 12 June 1945 or earlier. The right to file the application for registration derives from a bona fide claim of ownership going back to 12 June 1945 or earlier, by reason of the claimants open, continuous, exclusive and notorious possession of alienable and disposable land of the public domain. A similar right is given under Section 48(b) of CA 141, as amended by PD 1073, which provides:
Sec. 48. The following described citizens of the Philippines, occupying lands of the public domain or claiming to own any such land 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: xxx (b) Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of agricultural 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 application 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)

According to the Court of Appeals, respondent need not prove possession of the subject property since 12 June 1945 or earlier because Section 48(b) of CA 141 was amended by RA 1942, which provided for a simple 30-year prescriptive period. The Court of Appeals appears to have an erroneous interpretation of Section 48(b) of CA 141. Through the years, Section 48(b) of the CA 141 has been amended several times. The Court of Appeals failed to consider the amendment introduced by PD 1073. In Republic v. Doldol, the Court provided a summary of these amendments:

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The original Section 48(b) of C.A. No.141 provided for possession and occupation of lands of the public domain since July 26, 1894. This was superseded by R.A. No. 1942, which provided for a simple thirty-year prescriptive period of occupation by an applicant for judicial confirmation of imperfect title. The same, however, has already been amended by Presidential Decree No. 1073, approved on January 25, 1977. As amended, Section 48(b) now reads: (b) Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of agricultural 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 application 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)

As the law now stands, a mere showing of possession and occupation for 30 years or more is not sufficient. Therefore, since the effectivity of PD 1073 on 25 January 1977, it must now be shown that possession and occupation of the piece of land by the applicant, by himself or through his predecessorsin-interest, started on 12 June 1945 or earlier. This provision is in total conformity with Section 14(1) of PD 1529. In this case, respondent failed to comply with the period of possession and occupation of the subject property, as required by both PD 1529 and CA 141. We agree with the Republic that respondents evidence was not enough to prove that her possession of the subject property started since 12 June 1945 or earlier because respondents earliest evidence can be traced back to a tax declaration issued in the name of her predecessors-in-interest only in the year 1948. In view of the lack of sufficient showing that respondent and her predecessors-in-interest possessed the subject property under a bona fide claim of ownership since 12 June 1945 or earlier, respondents application for confirmation and registration of the subject property under PD 1529 and CA 141 should be denied. Finally, we note that respondent also failed to prove that the subject property has been declared alienable and disposable by the President or the Secretary of the

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Department of Environment and Natural Resources. Republic v. T.A.N. Properties, Inc., the Court said:
[T]he 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.

In

WHEREFORE, we GRANT the petition. We SET ASIDE the 30 January 2004 Decision of the Court of Appeals in CA G.R. CV No. 70006 and the 21 September 1998 Decision of the Regional Trial Court of Tagaytay City, Branch 18, in LRC Case No. TG-788. We DENY respondent Ruby Lee Tsais application for confirmation and registration of Lot No. 7062 described in plan Ap-04-010084, Cad-355, Tagaytay Cadastre. SO ORDERED.