Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. 164408 March 24, 2014

REPUBLIC OF THE PHILIPPINES, Petitioner,vs.

ZURBARAN REALTY AND DEVELOPMENT CORPORATION, Respondent.

D E C I S I O N

BERSAMIN, J.:

An application for original registration of land of the public domain under Section 14(2) of Presidential Decree (PD) No. 1529 must show not only that the land has previously been declared alienable and disposable, but also that the land has been declared patrimonial property of the State at the onset of the 30-year or 10-year period of possession and occupation required under the law on acquisitive prescription. Once again, the Court applies this rule-as clarified in Heirs of Mario Malabanan v. Republic1 – in reviewing the decision promulgated on June 10, 2004,2 whereby the Court of Appeals (CA) granted the petitioner's application for registration of land.

Antecedents

On May 28, 1993, respondent Zurbaran Realty and Development Corporation filed in the Regional Trial Court (RTC) in San Pedro, Laguna an application for original registration covering a 1,520 square meter parcel of land situated in Barrio Banlic, Municipality of Cabuyao, Province of Laguna, denominated as Lot 8017-A of Subdivision Plan CSD-04-006985-D, Cad. 455-D, Cabuyao Cadastre,3 alleging that it had purchased the land on March 9, 1992 from Jane de Castro Abalos, married to Jose Abalos, for P300,000.00; that the land was declared for taxation purposes in the name of its predecessor-in-interest under Tax Declaration No. 22711; that there was no mortgage or encumbrance of any kind affecting the land, nor was there any other person or entity having any interest thereon, legal or equitable, adverse to that of the applicant; and that the applicant and its predecessors-in-interest had been in open, continuous and exclusive possession and occupation of the land in the concept of an owner.

Attached to the application were several documents, namely: (1) tracing cloth plan as approved by the Land Management Division of the Department of Environment and Natural Resources (DENR); (2) blue print copies of the tracing cloth plan; (3) copies of the technical description; (4) copies of Tax Declaration No. 2711; and (5) copies of the Deed of Sale dated March 9, 1992.

The Republic, represented by the Director of Lands, opposed the application, arguing that the applicant and its predecessors-in-interest had not been in open, continuous, exclusive and notorious possession and occupation of the land since June 12, 1945; that the muniments of title and tax declaration presented did not constitute competent and sufficient evidence of a bona fide acquisition of the land; and that the land was a portion of the public domain, and, therefore, was not subject to private appropriation.4

The RTC directed the Land Management Bureau, Manila; the Community Environment and Natural Resources Office (CENRO) of Los Baños, Laguna; and the Land Management Sector and Forest Management Bureau, Manila, to submit a status report on the land, particularly, on whether the land was covered by a land patent, whether it was subject of a previously approved isolated survey, and whether it was within a forest zone.5

In his memorandum to the DENR, Region IV (Lands Forestry Sector), and the Provincial Prosecutor of Laguna, a copy of which was furnished the trial court, CENRO Officer Arnulfo Hernandez stated that the land had been "verified to be within the Alienable and Disposable land under Land Classification Project No. 23-A of Cabuyao, Laguna, certified and declared as such pursuant to the provisions of Presidential Decree No. 705, as amended, under Forestry Administrative Order No. A-1627 dated September 28, 1981 per BFD Map LC-3004." Attached to the memorandum was the inspection report declaring that "the area is surrounded with concrete fence, three (3) buildings for employees’ residence;" that the land was acquired through sale before the filing of the application; that the applicant and its predecessors-in-interest had been in "continuous, open and peaceful occupation" of the land, and that "no forestry interest is adversely affected."6

CENRO Land Management Inspector/Investigator Rodolfo S. Gonzales reported that: (1) the land was covered by a survey plan approved by the Regional Land Director/Land Registration Authority on May 25, 1988 pursuant to PD No. 239 dated July 9, 1975; (2) it consisted of 22,773 square meters and was located in Barangay Banlic, Cabuyao, Laguna; (3) the area was entirely within the alienable and disposable area; (4) it had never been forfeited in favor of the government for non-payment of taxes, and had not been confiscated in connection with any civil or criminal cases; (5) it was not within a previously patented property as certified to by the Register of Deeds, Calamba, Laguna; and (6) there was no public land application filed for it by the applicant or any other persons as per verification from the records unit of his office. The report further stated that a verification at the Office of the Municipal Assessor showed that: (1) the land was declared for the first time in 1960 under Tax Declaration No. 6712 in the name of Enrique Hemedez with an area of 23,073 square meters; (2) it was now covered by Tax Declaration No. 2253 issued in the name of the respondent; (3) the real property taxes had been paid since 1968; and (4) it had not been earmarked for public or quasi-public purposes per information from the District Engineer.

After inspection, it was also found that (1) the land was residential; (2) the respondent was in the actual occupation and possession of the land; and (3) the land did not encroach upon an established watershed, riverbank/bed protection, creek, right-of-way or park site or any area devoted to general use or devoted to public service.7

A certification was issued by the Records Management Division of the Land Management Bureau stating that it had no record of any kind of public land applications/land patents covering the parcel of land subject of the application.8

The respondent presented Gloria P. Noel, its Vice President and Treasurer, who testified that the respondent had purchased the land from Jane de Castro Abalos on March 9, 1992 for P300,000.00; that the land had been declared for taxation purposes in the name of Abalos under Tax Declaration No. 22711; that after the sale, a new Tax Declaration had been issued in the name of the respondent, who had meanwhile taken possession of the land by building a fence around it and introducing improvements thereon; that the respondent had paid the real property taxes thereon since its acquisition; that the respondent’s possession had been continuous, open and public; and that the land was free from any lien or encumbrance; and that there was no adverse claimant to the land.9

Engr. Edilberto Tamis attested that he was familiar with the land because it was a portion of Lot No. 8017 of Subdivision Plan Cad-455-D of the Cabuyao Cadastre, owned by Corazon Tapalla who had acquired it from the Hemedez family; that Tapalla had sold a portion of Lot No. 8017 to Abalos and the remaining portion to him; and that he had witnessed the sale of the land to the respondent.10

The respondent’s final witness was Armando Espela who declared that he was a retired land overseer residing in Barangay Banlic from birth; that he was familiar with the land which was part of a bigger parcel of land owned by the Hemedez family; that his father, Toribio Espela, with his assistance, and one Francisco Capacio worked on the land since 1960; that the entire landholding had originally been sugarland, but was later on subdivided, sold, and resold until it

ceased to be agricultural land; that, in 1982, the land was sold to Corazon Tapalla who hired him as the overseer; that as the overseer, he fenced and cleared the area; that he was allowed to use the grassy portion for grazing purposes; that in 1987, Tapalla sold part of the land to Abalos and the remaining portion to Engr. Tamis; that he continued to oversee the land for the new owners; that Abalos then sold her portion to the respondent in 1992; that since then, the respondent took possession of the land, and he then ceased to be the overseer; that the possession by the Hemedez family and its successors-in-interest was open, continuous, public and under claim of ownership; and that he did not know any person who claimed ownership of the land other than those he and his father served as overseers.11

Decision of the RTC

On May 12, 1997, the RTC rendered its decision, holding that the respondent and its predecessors-in-interest had been in open, public, peaceful, continuous, exclusive and adverse possession and occupation of the land under a bona fide claim of ownership even prior to 1960 and, accordingly, granted the application for registration, viz:

WHEREFORE, taking into consideration the evidence submitted by the applicant, this Court hereby orders the confirmation and registration of title of the land described as Lot 8017-A of subdivision plan Csd-04-006985-D, being a portion of Lot 8017 of subdivision plan Cad-455-D, Cabuyao Cadastre situated at Barangay Banlic, Cabuyao, Laguna with an area of 1,520 square meters to be entered under the name of the applicant Zurbaran Realty and Development Corporation, a corporation organized and existing under the laws of the Philippines with office address at 33 M. Viola St., San Francisco del Monte, Quezon City by the Land Registration Authority. After the decision shall become final, let an order for the issuance of a decree of title be issued in favor of said applicant.

SO ORDERED.12

Judgment of the CA

The Republic appealed, arguing that the issue of whether the applicant and its predecessors-in-interest had possessed the land within the required length of time could not be determined because there was no evidence as to when the land had been declared alienable and disposable.

On June 10, 2004, the CA promulgated its judgment affirming the RTC, and concluded that the reports made by the concerned government agencies and the testimonies of those familiar with the land in question had buttressed the court a quo’s conclusion that the respondent and its predecessors-in-interest had been in open, public, peaceful, continuous, exclusive, and adverse possession and occupation of the land under a bona fide claim of ownership even prior to 1960.13

Issue

Hence, the Republic appeals the adverse judgment of the CA upon the following ground:

THE COURT OF APPEALS GRAVELY ERRED ON A QUESTION OF LAW WHEN IT AFFIRMED THE TRIAL COURT’S GRANT OF THE APPLICATION FOR ORIGINAL REGISTRATION DESPITE THE ABSENCE OF EVIDENCE THAT RESPONDENT AND ITS PREDECESSORS-IN-INTEREST HAVE COMPLIED WITH THE PERIOD OF POSSESSION AND OCCUPATION REQUIRED BY LAW.14

The Republic contends that the respondent did not establish the time when the land covered by the application for registration became alienable and disposable;15 that such detail was crucial because the possession of the respondent and its predecessors-in-interest, for the purpose of determining whether it acquired the property by prescription, should be reckoned from the time when the land was declared alienable and disposable; and that prior to the declaration of the

land of the public domain as alienable and disposable, it was not susceptible to private ownership, and any possession or occupation at such time could not be counted as part of the period of possession required under the law on prescription.16

The respondent counters that whether it established when the property was declared alienable and disposable and whether it complied with the 30-year required period of possession should not be entertained anymore by the Court because: (a) these issues had not been raised in the trial court and were being raised for the first time on appeal; and (b) factual findings of the trial court, especially when affirmed by the CA, were binding and conclusive on this Court. At any rate, the respondent insists that it had been in open, public, peaceful, continuous, and adverse possession of the property for the prescribed period of 30 years as evidenced by the fact that the property had been declared for taxation purposes in 1960 in the name of its predecessors-in-interest, and that such possession had the effect of converting the land into private property and vesting ownership upon the respondent.17

In reply, the Republic asserts that it duly opposed the respondent’s application for registration; that it was only able to ascertain the errors committed by the trial court after the latter rendered its decision; and that the burden of proof in land registration cases rested on the applicant who must prove its ownership of the property being registered. The Republic maintains that the Court had the authority to review and reverse the factual findings of the lower courts when the conclusion reached was not supported by the evidence on record, as in this case.18

Ruling

The petition for review is meritorious.

Section 14 of P.D. No. 1529 enumerates those who may file an application for registration of land based on possession and occupation of a land of the public domain, thus:

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

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

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

x x x x

An application for registration under Section14(1) of P.D. No. 1529 must establish the following requisites, namely: (a) the land is alienable and disposable property of the public domain; (b) the applicant and its predecessors in interest have been in open, continuous, exclusive and notorious possession and occupation of the land under a bona fide claim of ownership; and (c) the applicant and its predecessors-in-interest have possessed and occupied the land since June 12, 1945, or earlier. The Court has clarified in Malabanan19 that under Section14(1), it is not necessary that the land must have been declared alienable and disposable as of June 12, 1945, or earlier, because the law simply requires the property sought to be registered to be alienable and disposable at the time the application for registration of title is filed. The Court has explained that a contrary interpretation would absurdly limit the application of the provision "to the point of virtual inutility."

The foregoing interpretation highlights the distinction between a registration proceeding filed under Section 14(1) of P.D. No. 1529 and one filed under Section 14(2) of P.D. No. 1529. According to Malabanan:

Section 14(1) mandates registration on the basis of possession, while Section 14(2) entitles registration on the basis of prescription. Registration under Section 14(1) is extended under the aegis of the Property Registration Decree and the Public Land Act while registration under Section 14(2) is made available both by the Property Registration Decree and the Civil Code.20

In other words, registration under Section 14(1) of P.D. No. 1529 is based on possession and occupation of the alienable and disposable land of the public domain since June 12, 1945 or earlier, without regard to whether the land was susceptible to private ownership at that time. The applicant needs only to show that the land had already been declared alienable and disposable at any time prior to the filing of the application for registration.

On the other hand, an application under Section 14(2) of P.D. No. 1529 is based on acquisitive prescription and must comply with the law on prescription as provided by the Civil Code. In that regard, only the patrimonial property of the State may be acquired by prescription pursuant to the Civil Code.21 For acquisitive prescription to set in, therefore, the land being possessed and occupied must already be classified or declared as patrimonial property of the State. Otherwise, no length of possession would vest any right in the possessor if the property has remained land of the public dominion. Malabanan stresses that even if the land is later converted to patrimonial property of the State, possession of it prior to such conversion will not be counted to meet the requisites of acquisitive prescription.22 Thus, registration under Section 14(2) of P.D. No. 1529 requires that the land had already been converted to patrimonial property of the State at the onset of the period of possession required by the law on prescription.

An application for registration based on Section 14(2) of P.D. No. 1529 must, therefore, establish the following requisites, to wit: (a) the land is an alienable and disposable, and patrimonial property of the public domain; (b) the applicant and its predecessors-in-interest have been in possession of the land for at least 10 years, in good faith and with just title, or for at least 30 years, regardless of good faith or just title; and (c) the land had already been converted to or declared as patrimonial property of the State at the beginning of the said 10-year or 30-year period of possession.

To properly appreciate the respondent’s case, we must ascertain under what provision its application for registration was filed. If the application was filed under Section 14(1) of P.D. No. 1529, the determination of the particular date when the property was declared alienable and disposable would be unnecessary, inasmuch as proof showing that the land had already been classified as such at the time the application was filed would be enough. If the application was filed under Section 14(2) of P.D. No. 1529, the determination of the issue would not be crucial for, as earlier clarified, it was not the declaration of the land as alienable and disposable that would make it susceptible to private ownership by acquisitive prescription. Malabanan expounds thereon, thus …Would such lands so declared alienable and disposable be converted, under the Civil Code, from property of the public dominion into patrimonial property? After all, by connotative definition, alienable and disposable lands may be the object of the commerce of man; Article 1113 provides that all things within the commerce of man are susceptible to prescription; and the same provision further provides that patrimonial property of the State may be acquired by prescription.

Nonetheless, Article 422 of the Civil Code states that "[p]roperty of public dominion, when no longer intended for public use or for public service, shall form part of the patrimonial property of the State." It is this provision that controls how public dominion property may be converted into patrimonial property susceptible to acquisition by prescription. After all, Article 420 (2) makes clear that those property "which belong to the State, without being for public use, and are intended for some public service or for the development of the national wealth" are public dominion property. For as long as the property belongs to the State, although already classified as alienable or disposable, it remains property of the public dominion if when it is "intended for some public service or for the development of the national wealth."

Accordingly, there must be an express declaration by the State that the public dominion property is no longer intended for public service or the development of the national wealth or that the

property has been converted into patrimonial. Without such express declaration, the property, even if classified as alienable or disposable, remains property of the public dominion, pursuant to Article 420(2), and thus incapable of acquisition by prescription. It is only when such alienable and disposable lands are expressly declared by the State to be no longer intended for public service or for the development of the national wealth that the period of acquisitive prescription can begin to run. Such declaration shall be in the form of a law duly enacted by Congress or a Presidential Proclamation in cases where the President is duly authorized by law.23

The respondent’s application does not enlighten as to whether it was filed under Section 14(1) or Section 14(2) of P.D. No. 1529. The application alleged that the respondent and its predecessors-in-interest had been in open, continuous and exclusive possession and occupation of the property in the concept of an owner, but did not state when possession and occupation commenced and the duration of such possession. At any rate, the evidence presented by the respondent and its averments in the other pleadings reveal that the application for registration was filed based on Section 14(2), not Section 14(1) of P.D. No. 1529. The respondent did not make any allegation in its application that it had been in possession of the property since June 12, 1945, or earlier, nor did it present any evidence to establish such fact.1âwphi1

With the application of the respondent having been filed under Section 14(2) of P.D. No. 1529, the crucial query is whether the land subject of the application had already been converted to patrimonial property of the State. In short, has the land been declared by law as no longer intended for public service or the development of the national wealth?

The respondent may perhaps object to a determination of this issue by the Court for the same reason that it objects to the determination of whether it established when the land was declared alienable and disposable, that is, the issue was not raised in and resolved and by the trial court. But the objection would be futile because the issue was actually raised in the trial court, as borne out by the Republic's allegation in its opposition to the application to the effect "that the land is a portion of the public domain not subject to prescription." In any case, the interest of justice dictates the consideration and resolution of an issue that is relevant to another that was specifically raised. The rule that only theories raised in the initial proceedings may be taken up by a party on appeal refers only to independent, not concomitant, matters to support or oppose the cause of action.24

Here, there is no evidence showing that the land in question was within an area expressly declared by law either to be the patrimonial property of the State, or to be no longer intended for public service or the development of the national wealth. The Court is left with no alternative but to deny the respondent's application for registration.

WHEREFORE, the Court GRANTS the petition for review on certiorari; REVERSES and SETS ASIDE the decision promulgated on June 10, 2004; and DISMISSES the respondent's application for original registration of Lot 8017-A of Subdivision Plan CSD-04-006985-D, Cad. 455-D, of the Cabuyao Cadastre.

No pronouncement on costs of suit.

SO ORDERED.

Republic of the PhilippinesSUPREME COURT

Manila

THIRD DIVISION

G.R. No. L-64818 May 13, 1991

REPUBLIC OF THE PHILIPPINES, petitioner,vs.

MARIA P. LEE and INTERMEDIATE APPELLATE COURT, respondents.

Pedro M. Surdilla for private respondent.

FERNAN, C.J.:p

In a land registration case, does the bare statement of the applicant that the land applied for has been in the possession of her predecessors-in- interest for more than 20 years constitute the "well-nigh incontrovertible" and "conclusive" evidence required in proceedings of this nature? This is the issue to be resolved in the instant petition for review.

On June 29, 1976, respondent Maria P. Lee filed before the then Court of First Instance (now Regional Trial Court) of Pangasinan, an application 1 for registration in her favor of a parcel of land consisting of 6,843 square meters, more or less, located at Mangaldan, Pangasinan.

The Director of Lands, in representation of the Republic of the Philippines, filed an opposition, alleging that neither the applicant nor her predecessors-in-interest have acquired the land under any of the Spanish titles or any other recognized mode for the acquisition of title; that neither she nor her predecessors-in-interest have been in open, continuous, exclusive and notorious possession of the land in concept of owner at least thirty (30) years immediately preceding the filing of the application; and that the land is a portion of the public domain belonging to the Republic of the Philippines. 2

After trial, the Court of First Instance 3 rendered judgment on December 29, 1976, disposing as follows:

WHEREFORE, pursuant to the Land Registration Law, Act No. 496, as amended by Republic Acts Nos. 1942 and 6236, the Court hereby confirms the title of the applicants over the parcel of land described in Plan Psu-251940 and hereby adjudicates the same in the name of the herein applicants, spouses Stephen Lee and Maria P. Lee, both of legal age, Filipino citizens and residents of Dagupan City, Philippines, as their conjugal property.

Once this decision becomes final, let the corresponding decree and title issue therefor.

SO ORDERED. 4

The Republic of the Philippines appealed to the then Intermediate Appellate Court (now Court of Appeals), which however affirmed the lower court's decision in toto on July 29, 1983. 5

Hence, this petition based on the following grounds: 6

The Intermediate Appellate Court erred:

A. IN NOT FINDING THAT THE RESPONDENT MARIA P. LEE HAS FAILED TO ESTABLISH BY CONCLUSIVE EVIDENCE HER FEE SIMPLE TITLE OR IMPERFECT TITLE WHICH ENTITLES HER TO REGISTRATION EITHER UNDER ACT NO. 496, AS AMENDED (LAND REGISTRATION ACT) OR SECTION 48 (B), C. A. NO. 141, AS AMENDED (PUBLIC LAND ACT);

B. IN GIVING WEIGHT AND CREDENCE TO THE CLEARLY INCOMPETENT, SELF-SERVING AND UNRESPONSIVE TESTIMONY OF RESPONDENT THAT THE SPOUSES URBANO DIAZ AND BERNARDA VINLUAN HAD BEEN IN POSSESSION OF THE PROPERTY FOR MORE THAN 20 YEARS LEADING TO REGISTRATION, THEREBY DEPRIVING THE STATE OF ITS PROPERTY WITHOUT DUE PROCESS;

C. IN ORDERING REGISTRATION SIMPLY BECAUSE PETITIONER FAILED TO ADDUCE EVIDENCE TO REBUT RESPONDENT'S EVIDENCE, WHICH, HOWEVER, STANDING ALONE, DOES NOT MEET THE QUANTUM OF PROOF—WHICH MUST BE CONCLUSIVE—REQUIRED FOR REGISTRATION;

D. IN NOT FINDING THAT RESPONDENT HAS MISERABLY FAILED TO OVERTHROW THE PRESCRIPTION THAT THE LAND IS PUBLIC LAND BELONGING TO THE STATE.

Private respondent, on the other hand, contends that she was able to prove her title to the land in question through documentary evidence consisting of Deeds of Sale and tax declarations and receipts as well as her testimony that her predecessors-in-interest had been in possession of the land in question for more than 20 years; that said testimony, which petitioner characterizes as superfluous and uncalled for, deserves weight and credence considering its spontaneity; that in any event, the attending fiscal should have cross-examined her on that point to test her credibility; and that, the reason said fiscal failed to do so is that the latter is personally aware of facts showing that the land being applied for is a private land. 7

We find for petitioner Republic of the Philippines.

The evidence adduced in the trial court showed that the land in question was owned by the spouses Urbano Diaz and Bernarda Vinluan, who on August 11, 1960, sold separate half portions thereof to Mrs. Laureana Mataban and Mr. Sixto Espiritu. On March 18, 1963, and July 30, 1963, respectively, Mrs. Mataban and Mr. Espiritu sold their half portions to private respondent Maria P. Lee. Private respondent had the property recorded for taxation purposes in her name and that of her husband Stephen Lee, paying taxes thereon on March 25, 1975 and March 9, 1976 for the same years.

At the time of the filing of the application for registration on June 29, 1976, private respondent had been in possession of the subject area for about thirteen (13) years. She, however, sought to tack to her possession that of her predecessors-in-interest in order to comply with the requirement of Section 48 (b) of commonwealth Act No. 141, as amended, to wit:

(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 applications for confirmation of title," except when prevented by war or force majeure. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this Chapter.

Private respondent's testimony on her predecessors-in-interest's possession is contained in a one-page declaration given before a commissioner on December 22, 1976. It reads in full as follows: 8

Commissioner: Atty. Surdilla, you can now present your evidence.

Atty. Surdilla: I am presenting the applicant, your Honor.

Commissioner: Swearing under oath the applicant.

Atty. Surdilla:

Q Please state your name and other personal circumstances.

A Maria P. Lee, of legal age, Filipino citizen, married to Stephen Lee, proprietor, and resident of Dagupan City.

Q Are you the applicant in this case now?

A Yes, sir, including that of my husband, Stephen Lee.

Q From whom did you acquire said property, subject of registration now?

A From Mr. Sixto Espiritu and Mrs. Laureana T. Mataban, sir.

Q Do you have evidence of such acquisition of yours over said property?

A Yes, sir.

Q Showing to you these documents styled as Deed of Absolute Sale dated March 18, 1963 and also Deed of Absolute Sale dated July 30, 1963, what can you say to them?

A The deed of sale dated March 18, 1963 is the conveyance to us by Mrs. Laureana T. Mataban over the 1/2 portion of the property and the deed of sale dated July 30, 1963 likewise refers to sale of the 1/2 portion of the property by Sixto Espiritu to us, sir.

Atty. Surdilla: At this juncture, may I pray that said Deeds of Absolute Sale adverted to above be marked as Exhibits "I" and "J", your Honor.

Commissioner: Please mark them accordingly.

Q Do you know from whom did Mr. Sixto Espiritu and Mrs. Laureana Mataban (your vendors) acquired likewise the property sought by you to be registered?

A Yes, sir. They purchased it from the spouses Urbano Diaz and Bernarda Vinluan who possessed the same for more than 20 years.

Q Showing to you this document styled as Deed of Absolute Sale, dated August 11, 1970, is this the sale adverted or referred by you?

A Yes, sir.

Atty. Surdilla: At this juncture, may I pray that said deed be marked as Exhibit "H", your Honor.

Commissioner: Please mark it.

Q Who is in possession of the property now? What is the nature thereof?

A I and my husband are in possession of the property, which possession tacked to that of our predecessors-in-interest is adverse, continuous, open, public, peaceful and in concept of owner, your Honor.

Q Whose name/names is the property declared for taxation purposes?

A We spouses Stephen Lee and Maria P. Lee, sir.

Atty. Surdilla: At this juncture, may I pray, sir, that Tax Declaration Nos. 22253 and 24126, be marked as Exhibits "K" and "K-1", respectively.

Commissioner: Please mark them accordingly.

Q Who has been paying taxes over the property?

A We the spouses Stephen Lee and myself, sir.

Atty. Surdilla: At this juncture, may I pray that Official Receipts Nos. H-6048922 and G-9581024, dated March 9, 1976 and March 25, 1975 be marked as Exhibits "L" and 'L-1",' respectively.

Commissioner: Please mark them accordingly.

Q Is the property ever mortgaged or encumbered in the bank or private person/persons?

A No sir. It is free from liens and encumbrances.

That's all, your Honor.

The most basic rule in land registration cases is that "no person is entitled to have land registered under the Cadastral or Torrens system unless he is the owner in fee simple of the same, even though there is no opposition presented against such registration by third persons. . . . In order that the petitioner for the registration of his land shag be permitted to have the same registered, and to have the benefit resulting from the certificate of title, finally, issued, the burden is upon him to show that he is the real and absolute owner, in fee simple." 9

Equally basic is the rule that no public land can be acquired by private persons without any grant, express or implied, from government. A grant is conclusively presumed by law when the claimant, by himself or through his predecessors-in-interest, has occupied the land openly, continuously, exclusively, and under a claim of title since July 26, 1894 10 or prior thereto. 11

The doctrine upon which these rules are based is that all lands that were not acquired from the government, either by purchase or by grant, belong to the public domain. As enunciated in the case of Santiago vs. de los Santos: 12

. . . Both under the 1935 and the present Constitutions, the conservation no less than the utilization of the natural resources is ordained. There would be a failure to abide by its command if the judiciary does not scrutinize with care applications to private ownership of real estate. To be granted, they must be grounded in well-nigh incontrovertible evidence. Where, as in this case, no such proof would be forthcoming, there is no justification for viewing such claim with favor. It is a basic assumption of our polity that lands of whatever classification belong to the state. Unless alienated in accordance with law, it retains its rights over the same as dominus . . .

Based on the foregoing, it is incumbent upon private respondent to prove that the alleged twenty year or more possession of the spouses Urbano Diaz and Bernarda Vinluan which supposedly formed part of the thirty (30) year period prior to the filing of the application, was open, continuous, exclusive, notorious and in concept of owners. This burden, private respondent failed to discharge to the satisfaction of the Court. The bare assertion that the spouses Urbano Diaz and Bernarda Vinluan had been in possession of the property for more than twenty (20) years found in private respondent's declaration is hardly the "well-nigh incontrovertible" evidence required in cases of this nature. Private respondent should have presented specific facts that would have shown the nature of such possession. The phrase "adverse, continuous, open, public, peaceful and in concept of owner" by which she described her own possession in relation

to that of her predecessors-in-interest are mere conclusions of law which require factual support and substantiation.

That the representing fiscal did not cross-examine her on this point does not help her cause because the burden is upon her to prove by clear, positive and absolute evidence that her predecessors' possession was indeed adverse, continuous, open, public, peaceful and in concept of owner. Her bare allegation, without more, did not constitute such preponderant evidence that would shift the burden of proof to the oppositor.

Neither does the supposition that the fiscal had knowledge of facts showing that the land applied for is private land helpful to private respondent. Suffice it to say that it is not the fiscal, but the court which should be convinced, by competent proof, of private respondent's registerable right over the subject parcel of land.

Private respondent having failed to prove by convincing, positive proof that she has complied with the requirements of the law for confirmation of her title to the land applied for, it was grave error on the part of the lower court to have granted her application.

WHEREFORE, the instant petition is hereby GRANTED. The decision appealed from is SET ASIDE. No pronouncement as to costs.

SO ORDERED.

Republic of the PhilippinesSUPREME COURT

Manila

THIRD DIVISION

G.R. No. L-52518 August 13, 1991

INTERNATIONAL HARDWOOD AND VENEER COMPANY OF THE PHILIPPINES, petitioner-appellee,

vs.UNIVERSITY OF THE PHILIPPINES and JOSE C. CAMPOS, JR., respondents-appellants.

Tañada, Vivo & Tan for petitioner-appellee.

DAVIDE, JR., J.:p

From an adverse decision of the then Court of First Instance (now RTC) Laguna dated 3 June 1968 in a special civil action for declaratory relief with injunction, Civil Case No. SC-650 entitled International Hardwood and Veneer Company of the Philippines vs. University of the Philippines and Jose Campos, the dispositive portion of which reads:

WHEREFORE, the Court hereby renders judgment in favor of petitioner and against the respondents:

(a) Declaring that Rep. Act No. 3990 does not empower the University of the Philippines, in lieu of the Bureau of Internal Revenue and Bureau of Forestry, to scale, measure and seal the timber cut by the petitioner within the tract of land referred to in said Act, and collect the corresponding forest charges prescribed by the National Internal Revenue Code therefor; and

(b) Dismissing the respondents' counterclaim.

respondents appealed to the Court of Appeals. The appeal was docketed as C.A.-G.R. No. 49409-R.

After the parties filed their respective Briefs in 1971, the Court of Appeals (Sixth Division) promulgated on 28 December 1979 a resolution elevating the case to this Court as the "entire case hinges on the interpretation and construction of Republic Act 3990 as it applies to a set of facts which are not disputed by the parties and therefore, is a legal question. 1

Civil Case No. SC-650 was filed by petitioner Hardwood before the trial court on 28 June 1966. 2 Petitioner seeks therein a declaration that respondent University of the Philippines (hereafter referred to as UP) does not have the right to supervise and regulate the cutting and removal of timber and other forest products, to scale, measure and seal the timber cut and/or to collect forest charges, reforestation fees and royalties from petitioner and/or impose any other duty or burden upon the latter in that portion of its concession, covered by License Agreement No. 27-A issued on 1 February 1963, ceded in full ownership to the UP by Republic Act No. 3990; asks that respondents be enjoined from committing the acts complained of and prays that respondents be required to pay petitioner the sum of P100,000.00 as damages and costs of the suit.

Its motion to dismiss on the ground of improper venue having been unfavorably acted upon, and pursuant to the order of the trial court of 26 August 1967, respondents filed their Answer on 13 September 1987, 3 wherein they interpose the affirmative defenses of, among others, improper

venue and that the petition states no cause of action; they further set up a counterclaim for the payment of it by petitioner of forest charges on the forest products cut and felled within the area ceded to UP under R.A. No. 3990 from 18 June 1964, with surcharges and interests as provided in the National Internal Revenue Code.

Petitioner filed a Reply and Answer to Counterclaim. 4

On 18 October 1967, the parties submitted a Joint Stipulation of Facts and Joint Submission of the Case for Judgment, 5 which reads as follows:

COME NOW the parties in the above entitled case by the undersigned counsel, and respectfully submit the following JOINT STIPULATION OF FACTS AND JOINT SUBMISSION OF THE CASE FOR JUDGMENT, without prejudice to the presentation of evidence by either party:

xxx xxx xxx

2. Plaintiff is, among others, engaged in the manufacture, processing and exportation of plywood and was, for said purpose, granted by the Government an exclusive license for a period of 25 years expiring on February 1, 1985, to cut, collect and remove timber from that portion of timber land located in the Municipalities of Infanta, Mauban and Sampaloc Province of Quezon and in the Municipalities of Siniloan, Pangil, Paete, Cavite and Calauan, Province of Laguna under License Agreement No. 27-A (Amendment) issued and promulgated by the Government through the Secretary of Agriculture and Natural Resources on January 11, 1960. ... ;

3. That aforementioned Timber License No. 27-A (Amendment) is a renewal of the Timber License Agreement No. 27-A previously granted by the Government to the plaintiff on June 4, 1953 to February 1, 1963. ... ;

4. Plaintiff, since June 4, 1953, continuously up to the present, has been in peaceful possession of said timber concession and had been felling cutting and removing timber therefrom pursuant to the aforementioned Timber License Agreement No. 27-A (Amendment) of January 11, 1960;

5. Plaintiff, on the strength of the License Agreement executed by the Government on June 4,1953 (License Agreement No. 27-A) and of the License Agreement No. 27-A (Amendment) of January 11, 1960, has constructed roads and other improvements and installations of the aforementioned area subject to the grant and purchased equipment in implementation of the conditions contained in the aforementioned License Agreement and has in connection therewith spent more than P7,000,000.00 as follows: ... ;

6. Sometime on September 25, 1961, during the effectivity of License Agreement No. 27-A (Amendment) of January 11, 1960, the President of the Philippines issued Executive Proclamation No. 791 which reads as follows:

xxx xxx xxx

RESERVING FOR THE COLLEGE OF AGRICULTURE, UNIVERSITY OF THE PHILIPPINES, AS EXPERIMENT STATION FOR THE PROPOSED DAIRY RESEARCH AND TRAINING INSTITUTE AND FOR AGRICULTURAL RESEARCH AND PRODUCTION STUDIES OF THIS COLLEGE A CERTAIN PARCEL OF LAND OF THE PUBLIC DOMAIN, SITUATED PARTLY IN THE MUNICIPALITIES OF PAETE AND PAKIL ,PROVINCE OF LAGUNA, AND PARTLY IN THE MUNICIPALITY OF INFANTA, PROVINCE OF QUEZON, ISLAND OF LUZON.

Upon the recommendation of the Secretary of Agriculture and Natural Resources and pursuant to the authority vested in me by law, I, Carlos P. Garcia, President of the Philippines, do hereby withdraw from sale or settlement and reserve for the College of Agriculture, University of the Philippines, as experiment station for the proposed Dairy Research and production studies of this College, a certain parcel of land of the Public domain situated partly in the municipalities of

Paete and Pakil province of Laguna, and partly in the municipality of Infants, Province of Quezon, Island of Luzon, subject to private rights, if any there be, and to the condition that the disposition of timber and other forest products found therein shall be subject to the forestry laws and regulations, which parcel of land is more particularly described as follows, to wit:

xxx xxx xxx

IN WITNESS WHEREOF, I have hereunto set my hand and caused the seal of the Republic of the Philippines to be affixed.

Done in the City of Manila this 25th day of September, in the year of Our Lord, nineteen hundred and sixty-one, and of the Independence of the Philippines, the sixteenth.

(SGD.) CARLOS P. GARCIA President of the Philippines

xxx xxx xxx

7. That on or about June 18, 1964, during the effectivity of the aforementioned License Agreement No. 27-A (Amendment) of July 11, 1960, Republic Act No. 3990 was enacted by the Congress of the Philippines and approved by the President of the Philippines, which Republic Act provides as follows:

AN ACT TO ESTABLISH A CENTRAL EXPERIMENT STATION FOR THE UNIVERSITY OF THE PHILIPPINES.

Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:

SECTION 1. There is hereby established a central experiment station for the use of the University of the Philippines in connection with its research and extension functions, particularly by the College of Agriculture, College of Veterinary Medicine and College of Arts and Sciences.

SEC. 2. For this purpose, the parcel of the public domain consisting of three thousand hectares, more or less, located in the Municipality of Paete, Province of Laguna, the precise boundaries of which are stated in Executive Proclamation 791, Series of 1961, is hereby ceded and transferred in full ownership to the University of the Philippines, subject to any existing concessions, if any.

SEC. 3. All operations and activities carried on in the central experiment station shall be exempt from taxation, local or general, any provision of law to the contrary notwithstanding, and any incidental receipts or income therefrom shall pertain to the general fund of the University of the Philippines.

SEC. 4. This Act shall take effect upon its approval. Approved, June 18, 1964.

8. That on the strength of the provisions of Republic Act No. 3990, and prior to the institution of the present suit, defendants have demanded, verbally as well as in writing to plaintiff-.

(a) That the forest charges due and payable by plaintiff under the License Agreement 27-A (Amendment) referred to in paragraph 2 hereof be paid to the University of the Philippines, instead of the Bureau of Internal Revenue; and

(b) That the selling of any timber felled or cut by plaintiff within the boundaries of the Central Experiment Station as defined in Republic Act No. 3990 be performed by personnel of the University of the Philippines.

9. That the position of the plaintiff oil the demand of the defendants was fully discussed in the letter dated April 29, 1966 of plaintiffs lawyer addressed to the President of the University of the Philippines, copy of which is hereto attached as Annex "A" hereof.

10. That in line with its position as stated in paragraph thereof, plaintiff has refused to allow entry to personnel of the University of the Philippines to the Central Experiment Station area assigned thereto for the purpose of supervising the felling cutting and removal of timber therein and scaling any such timber cut and felled prior to removal

11. That in view of the stand taken by plaintiff and in Relation to the implemetation of Republic Act No. 3990 the defendant Business Executive sent the letter quoted below to the Commissioner of Internal Revenue:

xxx xxx xxx

February 8, 1966

Commissioner of Internal Revenue

Manila

Re: Forest Charges of U.P. Paete Land Grant

Dear Sir:

Under Republic Act 3990 approved in June, 1964 a parcel of forest land approximately 3,500 hectares in area was ceded in full ownership by the government to the University of the Philippines. This area is known as Paete Land Grant, the title to which is presently issued in the name of the University of the Philippines. The law transferring the ownership to the University of the Philippines gives the university full rights of dominion and ownership, subject to the existing concession of International Hardwood and Veneer Company of the Philippines. Under the terms of this law all forest charges due from the concessionaire should now be paid to the University of the Philippines. The purpose of giving this land grant to the University is to enable us to generate income out of the land grant and establish a research and experimental station for the Colleges of Agriculture, Forestry, Arts and Sciences and Veterinary Medicine.

I would like, therefore, to inform you and to secure your approval of the following matters:

1. All forest charges paid by Interwood to the District Forester of Laguna from June, 1964 up to the present should be remitted in favor of the University of the Philippines pines;

2. All forest charges presently due from Interwood shall hereafter be paid to the University of the Philippines and lastly

3. Hereafter the University of the Philippines shall receive all forest charges and royalties due from any logging concession at the land grant.

May we request that proper instructions be issued by the district Forester of Laguna about this matter. Thank you.

Very truly yours,

Sgd.) JOSE C. CAMPOS JR.

Business Executive

12. That in reply to the above letter of defendant Business Executive dated February 8, 1966, the Commissioner of Internal Revenue issued the following letter-ruling dated March 11, 1966:

xxx xxx xxx

March 11, 1966

U.P. Paete Land Grant

University of the Philippines

Diliman, Quezon City

Attn: Jose C. Campos, Jr.

Business Executive

Gentlemen:

This has reference to your letter dated February 8, 1966 stating as follows:

xxx xxx xxx

In reply thereto, I have the honor to inform you as follows:

In accordance with Section 266 of the Tax Code as amplified by Section 15(a) of Revenue Regulations No. 85, the Forest Products Regulations, forest products, cut, gathered and removed from registered private woodlands are not subject to forest charges, but they must be invoiced when removed to another municipality or for commercial purposes in the manner prescribed by the regulations. As the Paete Land Grant was ceded by law to the U.P. in full private ownership and as the grant is manifestly to be considered registered, no forest charges are actually due and payable on the timber cut and removed therefrom. The forest charges purportedly to be paid by any concessionaire under any licensing agreement entered or to be entered into by the U.P. are, therefore, to be considered not as the charges contemplated by the National Internal Revenue Code but as part of the royalties payable by the concessionaires for the exploitation of the timber resources of the land grant.

Accordingly, you queries are answered viz:

1. The University may directly collect the supposed forest charges payable by concessionaires of the land grant.

2. The forest charges paid by International Hardwood and Veneer Company of the Philippines may be refunded provided that a formal claim for the refund thereof is made within two years from the date of payment. The proper claimant shall be International Hardwood and not the University.

Very truly yours,

(Sgd.) MISAEL P. VERA

Commissioner of Internal Revenue

13. That subsequently, defendant Business Executive sent the letter quoted below to the District Forester of the province of Laguna una dated April 18, 1 966:

April 18, 1966

The District Forester

Bureau of Forestry

Sta. Cruz, Laguna

Dear Sir:

Enclosed is a copy of a letter to the Commissioner of Internal Revenue concerning the right of the University of the Philippines to collect forest charges from the existing logging concessionaire at the Laguna Land Grant (formerly Paete Land Grant). This tract of forest land containing some 3,500 hectares was ceded to the University of the Philippines in full ownership by Republic Act No. 3990, approved in June, 1964. In view thereof, the University of the Philippines requested that its authority over said land be recognized and that the existing concessionaire, International Hardwood and Veneer Company of the Philippines, in turn pay its forest charges directly to the University instead of to the national government.

Please take note of page "2" of the enclosed letter of the Commissioner of Internal Revenue on the official ruling of the Bureau of Internal Revenue to the following points raised by the University:

1. That the University of the Philippines may now directly collect forest charges from INTERWOOD, the existing logging concessionaire.

2. That forest charges paid by INTERWOOD to the Bureau of Forestry from June, 1964 up to April, 1966 shall be refunded to the University of the Philippines. In this manner, INTERWOOD is requested to file a claim for the refund in the amount heretofore paid by it to be remitted to the University of the Philippines.

On the basis of this letter to the Commissioner of Internal Revenue, it is understood that forest charges on timber cut from the Laguna Land Grant as scaled by scalers of the University of the Philippines shall now be paid directly to the University of the Philippines. In another ruling by the Commissioner of Internal Revenue, the University, particularly the Laguna Land Grant, is exempted from all kinds of Internal Revenue taxes.

Very truly yours,

(Sgd.) Jose C. Campos, Jr.

Business Executive

14. That the above quoted letter of defendant Business Executive dated April 18, 1966 was duly endorsed by the District Forester of the province of Laguna to the Director of Forestry.

15. That on or about June 7, 19667 the Assistant Director of Forestry addressed to plaintiff the letter dated June 7, 1966, which states as follows:

Sirs:

This is in connection with your request for this Office to comment on your reply to the letter of Mr. Jose C. Campos, Jr. of the University of the Philippines.

In your reply to the letter of Mr. Campos, it is stated that the University of the Philippines is claiming the right:

(a) To scale, measure and seal the timber cut inside the area covered by the U.P. Land Grant at Paete, Laguna;

(b) To collect the corresponding forest charges;

(c) To collect royalties aside from the forest charges; and

(d) To exercise in effect all the authority vested by law upon the Bureau of Forestry in the cutting, removal and disposition of the timber from said area, and the authority of the Bureau of Internal Revenue respecting the measurement and scaling of the logs and the collection of the corresponding forest charges and other fees in connection therewith.

This office is in full accord with your arguments against the claim of the University of the Philippines to have acquired the above rights. We believe that the right vested the INTERWOOD by virtue of number License Agreement No. 27-A (Amendment) to utilize the timber inside subject area is still binding and should therefore, be respected. It is on the basis of this acknowledgment that we sent your client our letter of November 4,1965 requesting him to comment on the application of the State University for a Special Timber License over the said area.

16. That acting on the endorsement referred to in paragraph l4, the Director of Bureau of Forestry issued the letter ruling quoted below, dated June 30,1966:

xxx xxx xxx

June 30, 1966

District Forester

Sta. Cruz, Laguna

(Thru the Regional Director of Forestry, Manila)

Sir:

This concerns your inquiry contained in the 3rd paragraph of your letter dated April 26, 1966, designated as above, as to whether or not you shall turn over the scaling work for logs cut from the area of the International Hardwood & Veneer Company of the Philippines in the Pacto Land Grant to Scalers of the University of the Philippines.

In view of the ruling of the Commissioner of Internal Revenue that the Paete Land Grant, which embraces the area of the International Hardwood & Veneer Company of the Philippines, is considered a registered private woodland of the University of the Philippines and therefore no forest charges are actually due and payable on the timber cut and removed therefrom, and in view further of the ruling of said Commissioner that the forest charges purportedly to be paid by any concessionaire under any licensing agreement entered or to be entered into by the U.P. are to be considered not as the charged contemplated by the National Internal Revenue Code but as part of the royalties payable by the concessionaires for the exploitation of the timber resources of the land grant, you may turn over the scaling work therein to the scalers of the U.P.

However, you should guard against the use of such licensing agreements entered or to be entered into by the U.P. as a means of smuggling forest products from the neighboring public forests.

Very truly yours,

(SGD.) ANTONIO A. QUEJADA

xxx xxx xxx

On the basis of the above JOINT STIPULATION OF FACTS, the pleadings filed in the case, and whatever additional evidence may be presented by the parties, the parties hereto, through counsel, jointly move and pray of this Honorable Court that judgment be rendered granting full and appropriate relief, on the following issues:

1. Whether plaintiff, as of the date of present case was filed, should pay forest charges due and payable under its timber License Agreement No. 27-A (Amendment) as set forth in paragraph 2 hereof', to the Bureau of Internal Revenue, or to the University of the Philippines; and

2. In the event that it be found by this Honorable Court that said forest charges are to be paid to the University of the Philippines, whether or not the University of the Philippines is entitled to supervise, through its duly appointed personnel, the logging, telling and removal of timber within the Central Experiment Station area as described in Republic Act No. 3990, and to scale the timber thus felled and cut.

Manila for Laguna, September 29,1967.

Upon the foregoing Stipulation of Facts, the trial court rendered its judgment on 3 June 1968 in favor of the petitioner, the dispositive portion of which is quoted at the beginning of this decision. In deciding the case against UP, it held:

... the court finds that the respondents' demand on the petitioner has no legal basis. In the first place, the cession in full ownership of the tract of land referred to in the Act was expressly made 'subject to any existing concessions.' Inasmuch as at the time of the enactment of the Act, the petitioner's timber concession over the tract of land was existing and would continue to exist until February 1, 1985, the University of the Philippines will acquire full ownership' and exclusive jurisdiction to control and administer the property only after February 1, 1985. The cession of the property to the University of the Philippines is akin to the donation of a parcel of land, subject to usufruct. The donee acquires full ownership thereof only upon the termination of the usufruct. At the time of the donation, all what the donee acquires is the 'naked' ownership of the property donated. In the second place, the respondents' demand cannot be valid unless the provisions of Sees. 262 to 276 of the National Internal Revenue Code regarding the measuring of timber cut from the forest and the collection of the prescribed forest charges by the Bureau of Internal Revenue and Bureau of Forestry are first amended. In their arguments, the respondents tried to stretch the scope of the provisions of Republic Act No. 3990 in order to include therein such amendment of the provisions of the National Internal Revenue Code and Revised Administrative Code, but they failed to convince the Court, not only because of the first reason above stated, but also because it clearly appears that such amendment is not intended in Republic Act No. 3990, which does not contain even a remote allusion thereto in its title or a general amendatory provision at the end. In the third place, under Republic Act No. 3990, the University of the Philippines cannot legally use the tract of land ceded to it for purposes other than those therein expressly provided, namely, 'for the use of the University of the Philippines in connection with its research and extension functions, particularly by the College of Agriculture, College of Veterinary Medicine and College of Arts and Sciences.' Hence, upon the expiration of the petitioner's timber concession, the University of the Philippines cannot even legally renew it or grant timber concession over the whole tract of land or over portions thereof to other private individuals and exercise the functions of the Bureau of Internal Revenue and Bureau of Forestry by scaling and measuring the timber cut within the area and collecting from them the forest charges prescribed by the National Internal Revenue Code.

Respondents claim in their Brief that the trial court erred:

I

... WHEN IT DID NOT DISMISS THE PETITION FOR DECLARATORY RELIEF WITH INJUNCTION INSPITE OF ITS INHERENT JURISDICTIONAL DEFECTS THAT SHOULD WARRANT A DISMISSAL.

II

... WHEN IT DECLARED THAT REPUBLIC ACT NO. 3990 DOES NOT EMPOWER THE RESPONDENT UNIVERSITY OF THE PHILIPPINES, IN LIEU OF THE BUREAU OF INTERNAL REVENUE AND BUREAU OF FORESTRY, TO SCALE, MEASURE AND SEAL THE TIMBER CUT BY THE PETITIONER WITHIN THE TRACT OF LAND REFERRED TO IN SAID ACT, AND COLLECT THE CORRESPONDING FOREST CHARGES PRESCRIBED BY THE NATIONAL INTERNAL REVENUE CODE.

1. The first assigned error is without merit. In the Joint Stipulation of Facts, the parties jointly move and pray that the trial court render judgment granting full and appropriate remedy on the following issues:

l. Whether plaintiff, as of the date of present case was filed, should pay forest charges due and payable under its Timber License Agreement No. 27-A (Amendment) as set forth in paragraph 2 hereof, to the Bureau of Internal Revenue, or to the University of the Philippines; and

2. In the event that it be found by this Honorable Court that said forest charges are to be paid to the University of the Philippines, whether or not the University of the Philippines is entitled to supervise, through its duly appointed personnel, the logging, felling and removal of timber within the Central Experiment Station area as described in Republic Act No. 3990, and to scale the timber thus felled

These issues bring the matter within the scope of an action for declaratory relief under Section 1, Rule 64 of the Rules of Court and render meaningless the appeal to the rule laid down in Sarmiento, et al. vs. Caparas, et al. 6 that declaratory relief cannot be joined by injunction, because herein petitioner, for all legal intents and purposes, abandoned it by its failure to raise it in the Stipulation of Facts. Thus, what attains is an amendment to both pleadings (the complaint and the answer), which is authorized by Section 5, Rule 10 of the Rules of Court. Said section pertinently provides:

SEC. 5. Amendment to conform to or authorize presentation of evidence.— When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respect, as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment; but failure to so amend does not affect the result of the trial by these issues. ...

The stipulation of facts and the agreement as to the issues unquestionably satisfy the requisites for declaratory relief. (a) there must be a justiciable controversy; (b) the controversy must be between persons whose interests are adverse; (c) the party seeking declaratory relief must have a legal interest in the controversy; and (d) the issue invoked must be ape for judicial determination. 7

There is a justiciable controversy where there is an actual controversy, or the ripening seeds of one exists between the parties, all of whom are sui juris and before the court, and that the declaration sought will help in ending the controversy. A doubt becomes a justiciable controversy when it is translated into a claim of right which is actually contested. 8

2. On the second assigned error, respondents assert that: (a) Under R.A. No. 3990, the Republic of the Philippines may effect collection of forest charges through the University of the Philippines because the License Agreement does not expressly provide that the forest charges shall be paid to the Bureau of Internal Revenue; in the absence of a specific contractual provision limiting it to a particular agency in collecting forest charges owing to it, the Republic may effect such collection through another agency. (b) Having been vested with administrative jurisdiction over and being the owner of the tract of land in question, the UP acquired full control

and benefit of the timber and other resources within the area. Timber areas within the ceded property but outside the concession of petitioner can be fully exploited by UP. However, in respect to timber areas within the ceded property but covered by the concession of petitioner, only forest charges (or more appropriately, royalties) may be enjoyed by UP until the expiration of petitioner's license. To deny it such charges would render its "full ownership" empty and futile. (c) The UP is clearly entitled to the income derived from the tract of land ceded to it, for Section 3 of R.A. No. 3990 expressly provides:

All operations and activities carried on in the central experiment station shall be exempt from taxation, local or general, any provision of law to the contrary notwithstanding, and any incidental receipts or income therefrom shall pertain to the general fund of the University of the Philippines. (emphasis supplied for emphasis).

(d) As provided by R.A. No. 3990, the UP is duty bound to operate and maintain a central experiment station; since this law does not provide for appropriations for such purpose, it is clearly the legislative intention that the establishment and maintenance thereof must be financed by the earnings or income from the area, which can only come from the timber and the royalties or charges payable therefrom. This is in accordance with the general principle that a grant of authority or jurisdiction extends to all incidents that may arise in connection with the matter over which jurisdiction is exercised. (e) Supervision of the License Agreement in favor of petitioner by UP was intended by R.A. No. 3990. (f) Finally, the two government agencies affected by R.A. No. 3990 have issued specific rulings recognizing the authority of UP to collect royalties or charges and to supervise petitioner's logging operations.

Petitioner refutes the foregoing arguments of respondents by asserting that: (a) The UP has not been granted by R.A. No. 3990 the authority to collect forest charges or the authority to supervise the operation by the petitioner of the timber concession affected by said Act.

The rule is well-settled that legislative grants must be construed strictly in favor of the public and most strongly against the grantee, and nothing will be included in the grant except that which is granted expressly or by clear implication. Under Section 262 of the Tax Code, as amended, the duties incident to the measuring of forest products and the collection of the charges thereon shall be discharged by the Bureau of Internal Revenue under the regulations of the Department of Finance. The reforestation fee shall be collected by the Bureau of Forestry. 9 The supervision and regulation of the use of forest products and of the cutting and removal of forest products are vested upon the Bureau of Forestry. 10 R.A. No. 3990 does not expressly, or even impliedly, grant the UP any authority to collect from the holders of timber concessions on the area ceded to it forest charges due and payable to the Government under the Tax Code, or to enforce its provisions relating to charges on forest products or to supervise the operations of the concessions by the holders thereof; (b) The cession in full ownership of the land in question was expressly made "subject to any concession, if any", and that petitioner's concession would continue until 1 February 1985; the UP then would acquire full ownership and exclusive jurisdiction to control and administer the property only after 1 February 1985. The position of UP is akin to that of a donee of a parcel of land subject to usufruct. (c) The rulings of the Commissioner of Internal Revenue and the Acting Director of the Bureau of Forestry are patently incorrect; moreover, said agencies do not have the power to interpret the law, which is primarily a function of the judiciary. (d) Finally, it has acquired a vested right to operate the timber concession under the supervision and control of the Bureau of Forestry.

There is merit in the second assigned error.

Under Proclamation No. 791, dated 25 September 1961, a parcel of land of the public domain described therein, with an area of 3,500 hectares, which is the very parcel of land subject of R.A. No. 3990, was withdrawn from sale or settlement and was reserved for the College of Agriculture of the UP as experiment station for the proposed Dairy Research and Training Institute and for research and production studies of said college, subject however to private rights, if any, and to the condition that the disposition of timber and other forest products found thereon shall be subject to forestry laws and regulations.

The above reservation is within the area covered by petitioner's timber license.

Pursuant, however, to R.A. No. 3990 which establishes a central experiment station for the use of the UP in connection with its research and extension functions, particularly by the College of Agriculture, College of Veterinary Medicine and College of Arts and Sciences, the above "reserved" area was "ceded and transferred in full ownership to the University of the Philippines subject to any existing concessions, if any."

When it ceded and transferred the property to UP, the Republic of the Philippines completely removed it from the public domain and, more specifically, in respect to the areas covered by the timber license of petitioner, removed and segregated it from a public forest; it divested itself of its rights and title thereto and relinquished and conveyed the same to the UP; and made the latter the absolute owner thereof, subject only to the existing concession. That the law intended a transfer of the absolute ownership is unequivocally evidenced by its use of the word "full" to describe it. Full means entire, complete, or possessing all particulars, or not wanting in any essential quality. 11 The proviso regarding existing concessions refers to the timber license of petitioner. All that it means, however, is that the right of petitioner as a timber licensee must not be affected, impaired or diminished; it must be respected. But, insofar as the Republic of the Philippines is concerned, all its rights as grantor of the license were effectively assigned, ceded and conveyed to UP as a consequence of the above transfer of full ownership. This is further home out by Section 3 of R.A. No. 3990 which provides, inter alia, that "any incidental receipts or income therefrom shall pertain to the general fund of the University of the Philippines. Having been effectively segregated and removed from the public domain or from a public forest and, in effect, converted into a registered private woodland, the authority and jurisdiction of the Bureau of Forestry over it were likewise terminated. This is obvious from the fact that the condition in Proclamation No. 971 to the effect that the disposition of timber shall be subject to forestry laws and regulations is not reproduced iii R.A. No. 3990. The latter does not likewise provide that it is subject to the conditions set forth in the proclamation. An owner has the right to enjoy and dispose of a thing without other limitations than those established by law. 12 The right to enjoy includes the jus utendi or the right to receive from the thing what it produces, and the jus abutendi or the right to consume the thing by its use. 13 As provided for in Article 441 of the Civil Code, to the owner belongs the natural fruits, the industrial fruits and the civil fruits. There are, however, exceptions to this rules, as where the property is subject to a usufruct, in which case the usufructuary gets the fruits. 14 In the instant case, that exception is made for the petitioner as licensee or grantee of the concession, which has been given the license to cut, collect, and remove timber from the area ceded and transferred to UP until I February 1985. However, it has the correlative duty and obligation to pay the forest charges, or royalties, to the new owner, the UP, at the same rate as provided for in the Agreement. The charges should not be paid anymore to the Republic of the Philippines through the Bureau of Internal Revenue because of the very nature of the transfer as aforestated. Consequently, even the Bureau of Internal Revenue automatically lost its authority and jurisdiction to measure the timber cut from the subject area and to collect forestry charges and other fees due thereon.

The foregoing disposes of the contention of petitioner that R.A. No. 3990 does not grant the UP the authority to collect forest charges and to supervise the operations of its concession insofar as the property of the UP within it is concerned. Its argument that it has acquired vested rights to operate its concession under the supervision and control of the Bureau of Forestry is preposterous. The grantor, Republic of the Philippines, was by no means bound under the License to perpetuate the Bureau as its agent. Neither is there force to its contention that legislative grants must be construed strictly in favor of the public and most strongly against the grantee. The grant under R.A. No. 3990 is transfer of absolute, full and entire ownership which leaves no room for a strict interpretation against the grantee, the UP. The reservation therein made is in favor of the private party pursuant to the license, which is nevertheless protected. It is the concession in favor of the petitioner which should, on the contrary, be bound by the rule.

It follows then that respondent UP is entitled to supervise, through its duly appointed personnel, the logging, felling and removal of timber within the area covered by R.A. No. 3990.

IN THE LIGHT OF ALL THE FOREGOING, judgment is hereby rendered REVERSING the decision of the trial court in Civil Case No. C-650, rendered on 3 June 1968; DECLARING that forest charges due from and payable by petitioner for timber cut pursuant to its License Agreement No. 27-A (Amendment) within the area ceded and transferred to the University of the Philippine pursuant to R.A. No. 3990 shall be paid to the University of the Philippines; DECLARING that the University of the Philippines is entitled to supervise, through its duly appointed personnel, the logging, felling and removal of timber within the aforesaid area covered by R.A. No. 3990.

Costs against petitioner.

SO ORDERED.

Republic of the PhilippinesSUPREME COURT

Manila

EN BANC

G.R. No. L-27594 November 28, 1975

THE DIRECTOR OF LANDS, THE DIRECTOR OF FORESTRY, and the ARMED FORCES OF THE PHILIPPINES, petitioners,

vs.HON. SALVADOR C. REYES, as Judge of the Court of First Instance of Nueva Ecija,

Branch III, PARAÑAQUE INVESTMENT and DEVELOPMENT CORPORATION, ROMAN C. TAMAYO, THE COMMISIONER OF THE LAND REGISTRATION COMMISSION and the

REGISTER OF DEEDS OF NUEVA ECIJA, respondents.

G.R. No. L-28144 November 28, 1975

ALIPIO ALINSUNURIN, now substituted by PARAÑAQUE INVESTMENT and DEVELOPMENT CORPORATION, applicant-appellee,

vs.THE DIRECTOR OF LANDS, THE DIRECTOR OF FORESTRY and the ARMED FORCES OF

THE PHILIPPINES, oppositors-appellants.

Acting Solicitor General Hugo E. Gutierrez, Jr. and Assistant Solicitor General Reynato S. Puno for The Director of Lands, etc.

Jaime B. Lumasag Jr. and Jose J. Roy and Associates Law Office for Roman C. Tamayo.

Nemesio P. Diaz and Celso B. Fernandez, Jr. for Alipio Alinsunurin, etc.

ANTONIO, J.:

These cases are interrelated, and so are decided jointly.

In his application originally filed on February 24, 1964 with the Court of First Instance of Nueva Ecija, the applicant Alipio Alinsunurin, claiming ownership in fee simple by inheritance from the late Maria Padilla, sought the registration of title under Act 496, as amended, of a vast tract of land, containing an area of 16,800 hectares, more or less, situated at the municipality of Laur, province of Nueva Ecija, admittedly inside the boundary of the military reservation of Fort Magsaysay. 1

On May 5, 1966, the Director of Lands, Director of Forestry, and the Armed Forces of the Philippines opposed the application, claiming that the applicant was without sufficient title and was not in open, exclusive, continuous and notorious possession and occupation of the land in question for at least thirty (30) years immediately preceding the filing of the application; that approximately 13,957 hectares of said land consist of the military reservation of Fort Magsaysay established under Proclamation No. 237, dated December 10, 1955 of the President. 2

On May 10, 1966, the applicant Alipio Alinsunurin filed a motion for substitution of parties, requesting that the Parañaque Investment and Development Corporation be considered as the applicant in his place, it having acquired all his rights, interests, ownership and dominion over the property subject matter of the application. 3 The motion was granted by the lower court in its order dated June 10, 1966. 4

It is beyond dispute that the land subject of the application is included within the area reserved for military purposes under Proclamation No. 237, dated December 19, 1955, of the President. The land is largely uncultivated, mountainous and thickly forested with a heavy growth of timber of commercial quantities. 5 Except for a small area cultivated for vegetation by homesteaders issued patents by the Director of Lands, there were no occupants on the land. 6

It is claimed by the applicant that Melecio Padilla acquired the land by virtue of a possessory information title issued during the Spanish regime on March 5, 1895, and upon his death in 1900, he transmitted the ownership and possession thereof to his daughter and sole heir, Maria Padilla. The latter in turn continued to cultivate the land thru tenants and utilized portions for pasture, until her death sometime in 1944.

On November 19, 1966, the lower court rendered decision holding that the parcel of land applied for, described in the technical description Plan II-6752, is adjudicated to and ordered to be registered in favor of (a) Parañaque Investment and Development Corporation, a Philippine corporation wholly owned by Filipino citizens, with address at Manila, Philippines, two-thirds (2/3) portion, subject to the rights of Ariosto Santos per Joint Manifestation of Alipio Alinsunurin and Encarnacion Caballero-Alinsunurin, Ariosto Santos and Parañaque Investment and Development Corporation dated July 19, 1966 and marked as Exhibit "AA-4 " 7 and (b) Roman C. Tamayo, Filipino citizen, married, resident of Cullit, Lallo, Cagayan, one-third (1/3) portion of the said property.

On December 12, 1966, the oppositors Director of Lands, Director of Forestry and the Armed Forces of the Philippines filed a Notice of Appeal from the said decision to the Supreme Court, 8 copy of which notice was furnished counsel for the applicant Parañaque Investment and Development Corporation; however, no copy was furnished to counsel for Roman C. Tamayo, to whom one-third (1/3) portion of the land was adjudicated.

On January 18, 1967, within the extended period granted by the court, the oppositors-appellants filed the corresponding Record on Appeal, copy of which was duly served upon appellees Parañaque Investment and Development Corporation and Roman C. Tamayo.

By an order dated March 8, 1967, the lower court required the Provincial Fiscal to file an Amended Record on Appeal, so as to include therein certain orders and pleadings, within ten (10) days from receipt of the order. 9

On March 16, 1967, the Amended Record on Appeal was duly filed and copies served upon the appellees.

Pending the approval of the Record on Appeal, the applicant Parañaque Investment and Development Corporation filed a motion for the issuance of a decree of registration pending appeal. Likewise, Roman C. Tamayo, thru counsel, filed a motion for the issuance of a decree of registration. Both motions were opposed by the Government.

On March 11, 1967, the lower court, ruling that its decision of November 19, 1966 had become final as to the share of Roman C. Tamayo, directed the issuance of a decree of registration of the entire land, one-third (1/3) pro-indiviso in favor of Roman C. Tamayo, and two-thirds (2/3) pro indiviso in favor of Parañaque Investment and Development Corporation, subject to the final outcome of the appeal.

On March 14, 1967, the Commissioner of Land Registration forthwith issued Decree No. 113485 pursuant to the said order, and, on March 15, 1967, the Register of Deeds issued Original Certificate of Title No. 0-3151 of the Register of Deeds of the Province of Nueva Ecija.

On April 12, 1967, the lower court approved the Amended Record on Appeal which, together with the evidence and transcripts, was forwarded to this Court in due course of appeal.

As the lower court denied reconsideration of the order directing the issuance of a decree of registration, on May 29, 1967, the Director of Lands, Director of Forestry and the Armed Forces of the Philippines instituted before this Court a special civil action for certiorari and mandamus with preliminary injunction (L-27594), seeking to nullify the order dated March 11, 1967, the decree of registration issued pursuant thereto (Decree No. 113485 dated March 14, 1967) and Original Certificate of Title No. 0-3151 of the Register of Deeds for the province of Nueva Ecija, and to command the respondent court to certify the entire proceedings and to allow appeal to the Supreme Court from its decision in toto in LRC Case No. N-675, LRC Rec. No. N-25545.

On June 5, 1967, We issued a writ of preliminary injunction as follows:

NOW, THEREFORE, until further orders from this Court, You (respondent Judge) are hereby restrained from issuing a writ of possession in Land Registration Case No. N-675, LRC Rec. No. 25545 of the Court of First Instance of Nueva Ecija, entitled "Parañaque Investment and Development Corporation versus Director of Lands, et al."; You (respondent Parañaque Investment and Development Corporation and Roman C. Tamayo), your agents or representatives are hereby restrained from taking possession and/or excercising acts of ownership, occupancy or possession over the property in question subject matter of Land Registration Case No. N-675, LRC Rec. No. N-25545; and You (respondent Register of Deeds) are hereby restrained from accepting for registration documents referring to the subject land until petitioners shall have filed a notice of lis pendens as to the title certificates of Roman Tamayo and Parañaque Investment and Development Corporation, under Sec. 24, Rule 14, Rules of Court, subject of the above-mentioned Land Registration Case No. N-675, LRC Rec. No. N-25545.

Accordingly, petitioners-appellants caused the entry of a notice of lis pendens to be duly inscribed in the primary entry book of the Registry of Deeds of Nueva Ecija and annotated in the memorandum of encumbrances in Original Certificate of Title No. 0-3151.

In due time, the respondents filed their answers to the petition for certiorari. The parties having filed their respective memoranda, the case is deemed submitted for decision.

At the outset, We shall resolve the petition for certiorari and mandamus (L-27594).

I

Under the circumstances of this case, the failure of the appellants to serve a copy of their Notice of Appeal to the counsel for adjudicatee Roman C. Tamayo is not fatal to the appeal because, admittedly, he was served with a copy of the original, as well as the Amended Record on Appeal in both of which the Notice of Appeal is embodied. 10 Hence, such failure cannot impair the right of appeal. 11

What is more, the appeal taken by the Government was from the entire decision, which is not severable. Thus, the appeal affects the whole decision. 12

In any event, We rule that execution pending appeal is not applicable in a land registration proceeding. It is fraught with dangerous consequences. Innocent purchasers may be misled into purchasing real properties upon reliance on a judgment which may be reversed on appeal.

A Torrens title issued on the basis of a judgment that is not final is a nullity, as it is violative of the explicit provisions of the Land Registration Act which requires that a decree shall be issued only after the decision adjudicating the title becomes final and executory, and it is on the basis of said decree that the Register of Deeds concerned issues the corresponding certificate of title.

Consequently, the lower court acted without jurisdiction or exceeded its jurisdiction in ordering the issuance of a decree of registration despite the appeal timely taken from the entire decision a quo.

II

In the instant case, as a precaution, oppositors-appellants caused notice of lis pendens to be duly inscribed in Original Certificate of Title No. 0-3151 of the Register of Deeds of Nueva Ecija, thereby keeping the whole land subject matter of the appeal within the power of the court until the litigation is terminated. 13

Such entry of notice of lis pendens cannot be cancelled until the final termination of the litigation. The notice of lis pendens must be carried over in all titles subsequently issued, which will yield to the ultimate result of the appeal. 14

During the pendency of the appeal, it appears that Honofre A. Andrada, et al., filed with the Court of First Instance of Nueva Ecija (Branch I, not the land registration court), a complaint against the appellee Parañaque Investment and Development Corporation, Rodolfo A. Cenidoza and Roman C. Tamayo, for reconveyance of a portion of the land in question (Civil Case No. 4696). The trial court assumed jurisdiction over the case despite the pendency of the appeal involving the same land, and decided the case in favor of plaintiffs. In violation of Our injunction adverted to above, Parañaque Investment and Development Corporation executed a subdivision plan of the original single parcel of land subject of the land registration proceedings covered by Original Certificate of Title No. 0-3151, and deeded over six (6) lots of the subdivision plan to plaintiffs Honofre A. Andrada and Nemesio P. Diaz. By an order dated September 23, 1968, entered in Civil Case No. 4696, the Register of Deeds of Nueva Ecija was directed to cancel Original Certificate of title No. 0-3151 and to issue new titles to the above-named transferees "free from all liens and encumbrances." Immediately, transfer certificates of title were issued to them and other transferees in which the Register of Deeds of Nueva Ecija did not carry over the notice of lis pendens originally inscribed in Original Certificate of Title No. 0-3151. Subsequently, other transactions were entered into involving portions of the land reconveyed in Civil Case No. 4696, including a transfer of about 4,000 hectares to the Land Bank of the Philippines in consideration of P8,940,000.00.

We find the order to cancel Original Certificate of Title No. 03151 and to issue subsequent titles free from all liens and encumbrances to be void ab initio.

Civil Case No. 4696 is an action in personam to which the appellants are not parties; its object was to decree reconveyance to plaintiffs of a portion of the area adjudicated to the Parañaque Investment and Development Corporation and Roman C. Tamayo in Land Registration Case No. N-675, LRC Rec. No. N-25545, which is subject to the outcome of the appeal. Such action is barred by the pendency of the appeal. In that case, the court is without jurisdiction to order the Register of Deeds to cancel Original Certificate of title No. 0-3151 and to issue titles to transferees "free from all liens and encumbrances ." 15 Nor can such order be construed to authorize the Register of Deeds to cancel the notice of lis pendens, which was not entered by virtue of the reconveyance case. Thus, the Register of Deeds was duty bound to carry over the said notice of lis pendens on all titles subsequently issued. But, in plain violation of lis pendens in said titles; such act constitutes misfeasance in the performance of his duties for which he may be held civilly and even criminally liable for any prejudice caused to innocent third parties, but cannot affect the petitioners-appellants who are protected by Our writ of injunction and the notice of lis pendens inscribed in the original title. It must be remembered that Our injunction restrained the Register of Deeds "from accepting for registration documents referring to the subject land until the petitioners shall have filed a notice of lis pendens as to the title certificates of Roman C. Tamayo and Parañaque Investment and Development Corporation under section 24, Rule 14, Rules of Court, subject of the above-mentioned Land Registration Case No. N-675, LRC Rec. No. 25545." Its plain meaning is to enjoin registration of documents and transactions unless the notice of lis pendens is annotated and so subject the same to the outcome of the litigation. In such case, subsequent transferees cannot be considered innocent purchasers for value.

On the other hand, the lower court's order dated September 23, 1968, in Civil Case No. 4696, cannot overrule an injunction of this Court (in L-27594). As a result, We consider the notice of lis pendens entered in virtue of this litigation to remain in full force and effect, and affects all subsequent transferees of the title of the land subject of this appeal.

At any rate, it is well-settled that entry of the notice of lis pendens in the day book (primary entry book) is sufficient to constitute registration and such entry is notice to all persons of such adverse claim. 16

III

We now consider the appeal on the merits.

1. To begin with, the original tracing cloth plan of the land applied for, which must be approved by the Director of Lands, was not submitted in evidence. The submission of such plan is a statutory requirement of mandatory character. 17 Unless a plan and its technical description are duly approved by the Director of Lands, the same are not of much value. 18

It is true that blueprints of two survey plans were presented before the trial court (both marked Exhibit "D"). The first blueprint copy of a plan of land as surveyed for Maria Padilla (Exhibit "D", p. 4, Exhibits of Applicant), was not formally offered in evidence. The second plan of the land, as surveyed for Parañaque Investment and Development Corporation (also marked as Exhibit "D", p. 3, Exhibits of Applicant) was submitted by the said applicant, but it lacks the approval of the Director of Lands.

Of course, the applicant attempts to justify the non-submission of the original tracing cloth plan by claiming that the same must be with the Land Registration Commission which checked or verified the survey plan and the technical descriptions thereof. It is not the function of the LRC to check the original survey plan as it has no authority to approve original survey plans. If, for any reason, the original tracing cloth plan was forwarded there, the applicant may easily retrieve the same therefrom and submit the same in evidence. This was not done.

It is also asserted that a blue print copy of the plan (Exhibit "D", p. 5, Exhibits of Applicant) was superimposed in the military plan of the reservation under Proclamation No. 237, which military plan was presented in evidence by the oppositors-appellants (Exhibit "6"), and it was agreed by the parties that the plan, Exhibit "D", superimposed in the plan of the area covered by the proclamation, is the plan of the land applied for (p. 15, Brief for Applicant-Appellee).

Obviously, the superimposition of the copy of the survey plan of land as surveyed for applicant in the military map of the area under Proclamation No. 237 was for the sole purpose of showing that the land applied for is situated within the area covered by the military reservation of Fort Magsaysay appropriately indicated in the perimeter map of said reservation (Exhibit "6"). But the applicant is not relieved from the original tracing cloth plan approved by the Director of Lands as required by law. One of the distinguishing marks of the Torrens System is the absolute certainty of the identity of a registered land. Consequently the primary purpose of the aforesaid requirement is to fix the exact or definite identity of the land as shown in the plan and technical descriptions. Hence, the applicant is not relieved of his duty of submitting the original tracing cloth of the survey plan of the land duly approved by the Director of Lands.

It will be noticed that the plan (Exhibit "D", p. 5, Exhibits of Applicant) does not bear the approval of any officer authorized by law.

In similar manner, the surveyor's certificate, also required in original land registration proceedings, was not offered in evidence.

2. We next consider the question of whether the applicant has a registerable title to the land applied for.

The applicant relies on a purported titulo de informacion posesoria issued in the name of Melecio Padilla (Exhibit "T" pp. 64-68, Exhibits of Applicant). However, neither the original of the said titulo de informacion posesoria, nor a duly authenticated copy thereof, was submitted in evidence, and there are serious flaws on the faces of the alleged copies of the document, as in the circumstances surrounding their execution. Thus, the two (2) purported photostat copies of the said informacion posesoria title materially differ on the date when said informacion posesoria was issued. One copy showed that the said document was issued on March 5, 1895 (Exhibit "T") while the other indicated that it was issued twelve (12) years earlier, or on March 5, 1883 (Exhibit "2").

Moreover, according to the official records of the Register of Deeds of Nueva Ecija, on the basis of the "List of Possessory Information Titles (Spanish Titles) of Nueva Ecija", the corresponding supporting documents of which are kept in the vault of said office, the name of Melecio Padilla does not appear among those listed as holders of informacion posesoria titles as of the year 1898 covering lands situated in Santor (now Laur) Nueva Ecija. According to said document, the name Melecio Padilla appears only in the list of holders of possessory information titles over lands situated in Peñaranda, Nueva Ecija, but of a substantially smaller acreage. 19 Thus, the seven (7) parcels recorded in the name of Melecio Padilla covered only a total area of 49 hectares, 18 acres and 325 centares. 20 In addition, the list of property owners in Santor (now Laur), Nueva Ecija existing in the Division of Archives does not include the name of Melecio Padilla. 21 It is true that an alleged copy of an informacion posesoria in the name of Melecio Padilla, was recorded in the office of the Register of Deeds on November 10, 1942 by one Rodolfo Baltazar, Register of Deeds (Exhibit "H"), but the Register of Deeds of Nueva Ecija could not certify to its veracity, as the supposed document does not exist in their records. 22 There is another factor which weighs heavily against the claim of the applicant. The alleged informacion posesoria covers an area of "seis mil quiñiones, poco mas e menos" or an equivalent of 16,800 hectares. Under the Royal Decrees in force at the time of the supposed acquisition, no one could acquire public land in excess of 1,000 hectares. Thus, the Royal Decrees of November 25, 1880 and October 26, 1881, prohibited any grant of public land in excess of one thousand (1,000) hectares. 23

Besides, the document described in Exhibit "H" is not the titulo de informacion posesoria, because it was merely a certification of possession of Melecio Padilla over the property, and was issued without prejudice to a third party or parties having a better right. 24 Thus, it states: "En su virtud habiendo examinado el Registro nuevamente formado por la perdida o destruccion del mismo y no hallando en ningun asiento contrario a lo relacionado reinscribe la posesion de la finca de este numero a favor de Don Melecio Padilla sin perjuicio de tercero que puede tener mejor derecho a la propiedad." Under Spanish law, in order that an informacion posesoria may be considered as title of ownership, it must be proven that the holder thereof has complied with the provisions of Article 393 of the Spanish Mortgage Law.

It cannot be claimed that the registration of possession has been legally converted into a registration of ownership because Melecio Padilla had not complied with the requirements of Article 393 of the Spanish Mortgage Law, to wit: "that the applicant has been in open possession of the land; that an application to this effect be filed after the expiration of 20 years from the date of such registration; that such conversion be announced by means of a proclamation in a proper official bulletin; that the Court order the conversion of the registration of possession into a record of ownership; and that the Registrar make the proper record thereof in the Registry." 25 Evidently, Melecio Padilla, having died on February 9, 1900, barely five (5) years after the inscription of the informacion posesoria, could not have converted the same into a record of ownership twenty (20) years after such inscription, pursuant to Article 393 of the Spanish Mortgage Law.

One year after the promulgation of the Maura Law, or on April 17, 1895, the right to perfect possessory information title under the law expired. After that date, full property right of the land reverted to the government and the right of the cultivator and possessor to obtain gratuitous title was extinguished. 26

Before the military reservation was established, the evidence is inconclusive as to possession, for it is shown by the evidence that the land involved is largely mountainous and forested. As a matter of fact, at the time of the hearing, it was conceded that approximately 13,957 hectares of said land consist of public forest. During the lifetime of Melecio Padilla, only a small portion thereof was cleared and cultivated under the "kaingin" system, while some portions were used as grazing land. After his death, his daughter, Maria Padilla, caused the planting of vegetables and had about forty (40) tenants for the purpose. 27 During the Japanese occupation, Maria Padilla died. Alipio Alinsunurin and Encarnacion Caballero took possession of the land approximately in 1950, but they had to abandon the place due to the unsettled peace and order conditions in the area. In 1955, entry by them was prevented by the Army.

It seems obvious, on the basis of the facts in the record, that neither applicant Parañaque Investment and Development Corporation nor Alipio Alinsunurin nor the latter's predecessors-in-interest have been "in open, continuous, exclusive, and notorious possession and occupation" of the property in question, "under a bona fide claim of acquisition or ownership, for at least thirty years immediately preceding the filing of the application for confirmation of title." 28

A mere casual cultivation of portions of the land by the claimant, and the raising thereon of cattle, do not constitute possession under claim of ownership. In that sense, possession is not exclusive and notorious so as to give rise to a presumptive grant from the State. 29 While grazing livestock over land is of course to be considered with other acts of dominion to show possession, the mere occupancy of land by grazing livestock upon it, without substantial inclosures or other permanent improvements, is not sufficient to support a claim of title thru acquisitive prescription. 30 The possession of public land, however long the period may have extended, never confers title thereto upon the possessor because the statute of limitations with regard to public land does not operate against the State, unless the occupant can prove possession and occupation of the same under claim of ownership for the required number of years to constitute a grant from the State. 31

Apart from the aforesaid inconclusive evidence of possession to support the applicant's claim of title, it does not appear that the said property has ever been declared for taxation purposes by either applicant or applicant's predecessors-in-interest. Thus, the only tax declarations submitted were those of Mamerto Garcia and Honofre Andrada, et al. (Exhibit "G", Tax Declaration No. 5576, covering an area of 7,340 hectares) and Mamerto Garcia, et al. (Exhibit "H-1", Tax Declaration No. 5577, over an area of 9,547 hectares) but both were filed only in 1958. The latter declaration contains an annotation that the property described therein is an unidentified property, as the declarant failed to identify the same, and it "was only through his insistence" that it was assessed. Neither applicant Parañaque Investment and Development Corporation nor its predecessor, Alipio Alinsunurin had submitted any tax declaration supporting its/his claim over the property. It is true that tax receipts and declarations of ownership for taxation purposes are not incontrovertible evidence of ownership, but they constitute at least proof that the holder had a claim of title over the property.

It is obvious that the applicant has failed to submit convincing proof of actual, peaceful and adverse possession in the concept of owner of the entire area in question during the period required by law. This is especially true in view of the basic presumption that lands of whatever classification belong to the State and evidence of a land grant must be "well-nigh incontrovertible." 32

Even more important, Section 48[b] of CA No. 141, as amended, applies exclusively to public agricultural land. Forest lands or areas covered with forest are excluded. 33 It is well-settled that forest land is incapable of registration; and its inclusion in a title, whether such title be one issued during the Spanish sovereignty or under the present Torrens system of registration, nullifies the title. 34

Finally, the applicant urges that Proclamation No. 237 recognizes the existence of private property within the military reservation. It is true that the proclamation states that the same is subject "to private rights, if any there be", but applicant must prove its private rights over the

property, which said party failed to do. 35 For it is well-settled that, unless the applicant has shown by clear and convincing evidence that the property in question was ever acquired by the applicant or his ancestors either by composition title from the Spanish Government or by possessory information title, or any other means for the acquisition of public lands, the property must be held to be part of the public domain. 36

WHEREFORE, decision in the above case is hereby rendered:

(1) in G. R. No. L-27594, the petition for certiorari is granted; the order dated March 11, 1967 in LRC Case No. N-675, LRC Rec. No. N-25545, the decree of registration issued pursuant thereto (Decree No. 113485 dated March 14, 1967), and Original Certificate of Title No. 0-3151 of the Registry of Deeds of Nueva Ecija are all declared void; the Registry of Deeds of Nueva Ecija is ordered to recall and cancel all transfer certificates of title, including owners' duplicates and mortgagees' copies, if any, arising out of Original Certificate of Title No. 0-3151; the preliminary injunction issued on June 5, 1967 and the temporary restraining order issued on June 1, 1973 are made final and permanent, with costs against respondents (except respondent Judge); and

(2) in G. R. No. L-28144, the appealed decision is hereby reversed and set aside, and judgment is rendered dismissing the application for registration. Costs against appellee.