Republic v AgunoyInterplaying in this case are two (2) counter-balancing doctrines in the law of land titles: one, the doctrine offraus et jus nunquam cohabitant,which basically means that no one may enjoy the fruits of fraud,[1]and the other, the doctrine that a fraudulent title may be the root of valid title in the name of an innocent buyer for value and in good faith.[2]Invoking the first, petitioner Republic of the Philippines in this petition for review on certiorari under Rule 45 of the Rules of Court, seeks to nullify and set aside thedecision dated September 26, 2002[3]of the Court of Appeals inCA-G.R. CV No. 55732, which reversed an earlier decision of the Regional Trial Court at Cabanatuan City, Branch 25, in its Civil Case No. 831-AF, an action for cancellation of free patent, original certificate of title and derivative transfer certificates of title, thereat filed by the petitioner against, among others, the herein respondents.

The facts are well laid out in the decision under review:

On May 26, 1958, Gregorio Agunoy, Sr. filed his application for Free Patent No. 5-1414 covering two parcels of land identified asLot Nos. 1341 and 1342, Cad 269, Sta. Rosa Cadastre, Nueva Ecija, containing an aggregate area of 18.6486 hectares with the Bureau of Lands. On January 18, 1967, he was issuedFree Patent No. 314450by the Director of Lands.

On February 6, 1967, the Register of Deeds of Nueva Ecija registered Free Patent No. 314450 and issued the correspondingOriginal Certificate of Title (OCT) No. P-4522in the name of Gregorio Agunoy, Sr.On March 10, 1967, the heirs of Eusebio Perez, represented by Francisca Perez, caused the annotation on the said OCT of an adverse claim in their favor over a portion of 15.1593 hectares of the property.

On July 30, 1975, the said heirs of Eusebio Perez filed a formal protest docketed as B.L. Claim No. 760 (n) with the Bureau of Lands alleging that Lot 1341 of the Sta. Rosa Cadastre, Nueva Ecija, covered by Original Certificate of Title No-P4522 is identical to Lots 1 and 2 of Plan Psu-47200 which had been adjudicated as private property of said protestant pursuant to a decision promulgated on October 24, 1960 by the Court of First Instance of Nueva Ecija in Land Registration Case No. 430, LRC Records No. 14876.On May 3, 1976, the chief of the Legal Division, Bureau of Lands, conducted a formal investigation and ocular inspection of the premises and it was ascertained that Free Patent No. 314450 and its corresponding OCT No. P-4522 were improperly and fraudulently issued (Records, p.78)

On July 31, 1979, upon the death of the wife of Gregorio Agunoy, Sr., the heirs, namely Gregorio Sr., Tomas, Lilian, Angelito and Gregorio, Jr., executed a Deed of Extrajudicial Partition with Sale in favor of Joaquin Sangabol for and in consideration of the sum of Twenty Thousand Pesos (P20,000.00).

The Original Certificate of Title No. P-4522 was cancelled by the Register of Deeds of Nueva Ecija and Transfer Certificate of Title (TCT) No. 166270 was issued in favor of the aforenamed heirs. Said TCT No. 166270 was again cancelled by reason of the concurrent sale to Joaquin Sangabol in whose favor TCT No. NT- 166271 was issued.On August 1, 1979, Joaquin Sangabol sold an undivided portion of three (3) hectares of the property described as Lot 1341 in TCT No. NT-166271 to Fortunato Para for and in consideration of the sum of Three Thousand Five Hundred Pesos (3,500.00)

The following day, he sold the property described as Lot 1342 in TCT No. NT-166271 to Virginia P. Jimenez for and in consideration of the sum of One Thousand Five Hundred Pesos (P1,500.00) in whose favor TCT No. N-166287 was issued.

On May 12, 1980,the adverse claim of Francisca Perez, et al. annotated at the back of the OCT was cancelled by the Register of Deeds of Nueva Ecija(Exhibit G).On January 16, 1981, Joaquin Sangabol subdivided the property described as Lot 1341 in TCT No. NT-166271 into three lots designated as Lot Nos. 1341-A, 1341-B, and 1341-C of plan Psd-299875 duly approved by the Land Registration Commission.

TCT No. NT-166271 was cancelled and TCT No. NT-168972 covering Lot No. 1341-A was issued to spouses Fortunato Para and Araceli Sena. TCT Nos. NT-168973 and NT-168974 covering Lot Nos. 1341-B and 1341-C were issued in favor of Joaquin Sangabol.

On June 15, 1982, Virginia P. Jimenez sold the property covered by TCT No. NT-166287 in favor of spouses Blandino and Josefina A. Salva Cruz for Eleven Thousand Five Hundred Pesos (P11,500.00) where TCT No. 174634 was issued in favor of said spouses. On June 17, 1982, Josefina A. Salva Cruz effected the subdivision of the property into thirteen (13) lots designated as Lot Nos. 1342-A t0 1342-M as per subdivision plan Psd-03-004756 thereby canceling TCT No. NT-174634 and TCT Nos. NT- 174635 to 174647 were issued in lieu thereof.

On November 2, 1982, Fortunato Para, through his attorney-in-fact Gloria Bergonia, mortgaged the property covered by TCT No. NT-168972 in favor of the Perpetual Finance and Investment, Inc. in the amount of One Hundred Twenty Five Thousand Pesos (P125,000.00). The mortgage was foreclosed and the property was sold at public auction. Thereafter, the corresponding certificate of sale was executed in favor of Perpetual Finance and Credit, Inc.

On March 3, 1983, the properties covered by TCT Nos. NT-174643 and NT- 174644 were mortgaged with the Rural Bank of Gapan for Forty Thousand Pesos (P40,000.00). On February 25, 1985, the mortgage was likewise foreclosed and the properties were sold at public auction in favor of the said bank.

On December 16, 1986, Joaquin Sangabol sold the property covered by TCT No. NT-168974 to Eduardo R. Dee for and in consideration of the sum of One Hundred Twenty [Thousand] Pesos (P120,000.00). Subsequently, TCT No. NT-168974 was cancelled andTCT No. 196579was issued in the name ofEduardo R. Dee.On January 5, 1988, the heirs of Ruperto Perez (oldest son of Eusebio), now represented by Sabina P. Hernandez, filed a supplemental protest alleging that:

a) Lot Nos. 1341 and 1342, Cad 269 of the Sta. Rosa Cadatre have been exclusively occupied and cultivated by them and their immediate predecessors-in-interest who have introduced permanent improvements thereon consisting of irrigated ricelands, mango trees, bamboo groves and other crops;

b) Gregorio Agunoy, Sr. never occupied and cultivated said parcels of land in the manner and for the period required by law;c) Said parcels of land are identical to Lots 1, 3 and a portion of 87,674 square meters of Lot 4 of the amended plan-47200 Amd. as shown by the relocation survey conducted by Geodetic Engineer Deogracias L. Javier on July 29, 1977;

d) The patent and title issued to Gregorio Agunoy, Sr. were obtained through fraud and misrepresentation. (Records pp. 9-10)

The Bureau of Lands conducted anew an investigation and ocular inspection of Lot 1342, Cad. 269 of Sta. Rosa Cadastre, Nueva Ecija, and came out with the following findings, to wit:

a) Lot 1342, Cad. 269 of Sta Rosa Cadastre, Nueva Ecija is located at Barangay Imbunia (formerly Marawa), Municipality of Jaen, Nueva Ecija;

b) Said lot was originally registered in the Office of the Register of Deeds of Cabanatuan City on May 23, 1914 under OCT No. 125 issued in the name of Valeriano Espiritu, pursuant to Decree No. 15733 issued on May 20, 1914 in Land Registration Case No. 9552;

c) On May 13, 1952, said property was conveyed in favor of Isaias Carlos under TCT No. 11554 and the latter conveyed the same in favor of the spouses Santiago Mateo and Leogarda Juliano;

d) TCT No. 11554 was cancelled and in lieu thereof, TCT No. 17471 was issued in the name of Santiago Mateo. (Records, pp. 13;78)

On May 10, 1988, the Chief of the Legal Division recommended to the Director of Lands that court action be instituted for the cancellation of Free Patent No. 314450 and its corresponding Original Certificate of Title No. P-4522 in the name Gregorio Agunoy, Sr., as well as other subsequent transfer certificates of title issued therefrom based on the foregoing findings (Underscoring supplied).

It was against the foregoing backdrop of events when, on May 24, 1990, in the Regional Trial Court at Gapan, Nueva Ecija petitioner Republic of the Philippines, thru the Office of the Solicitor General, filed the complaint[4]in this case against several defendants, among whom are the herein respondents Gregorio Agunoy, Sr., his children, the spouses Eduardo Dee and Arcelita Marquez-Dee and the Rural Bank of Gapan, Nueva Ecija. In its complaint, docketed as Civil Case No. 831-AF, petitioner Republic alleged,inter alia, as follows:

30. Free Patent No. 314450 and its corresponding Original Certificate of Title No. P-4522 were procured by defendant Gregorio Agunoy, Sr., through fraud, deceit and misrepresentation sincethe property in question (Lots 1341 and 1342) at the time the patent and the title were issued was already adjudicated as private property of the heirs of Eusebio Perez and Valeriano Espiritu, respectively. Consequently, the then Bureau of Lands, now Lands Management Bureau, no longer had any jurisdiction and control over the same. xxx xxx.

31. The fraudulent acts and misrepresentation of defendant Gregorio Agunoy, Sr. had misled the then Bureau of Lands in issuing said patent.Since the property in question was no longer a disposable public land, Free Patent No. 314450 and its corresponding Original Certificate of Title No. P-4522 issued to defendant Gregorio Agunoy, Sr. are null and void and should be cancelled. Moreover, Gregorio Agunoy, Sr. has not occupied and cultivated the land in the manner and for the length of time required by law (C.A. 141 as amended; see also RA 782) (Emphasis supplied),

and accordingly prayed for a judgment -

1. DeclaringFree Patent No. 314450and the correspondingOriginal Certificate of Title No. P-4522in the name of Gregorio Agunoy,as well as all other subsequent transfer certificates of title emanating therefrom, i.e., Transfer Certificates of Title Nos. NT-168972, NT-168973, NT-196579, NT-174635 to NT-174647 (inclusive), including all liens and encumbrances annotated thereon, null and void;

2. Ordering defendants to surrender their owners duplicate copies of all subsequent transfer certificates of title emanating from Original Certificate of Title No. P-4522 to the Register of Deeds of Nueva Ecija;

3. Directing the Register of Deeds of Nueva Ecija to cancel the aforesaid certificates of title;

4. Ordering defendants and all those claiming under them to desist from exercising or representing acts of ownership and/or possession in the premises (Underscoring supplied).

xxx xxx xxx

Eventually, in a decision dated September 9, 1996,[5]the trial court rendered judgment for the Republic, thus:

PREMISES CONSIDERED, judgment is hereby rendered in favor of the plaintiff and against the defendants as follows:

1. Declaring as null and void Free Patent No. 314450 and the corresponding Original Certificate of Title No. P-4522 in the name of Gregorio Agunoy,as well as all other subsequent transfer certificates of titles emanating therefrom(TCT Nos. NT-166270, NT-166271, NT- 168972, NT-168973, NT-168974, NT-166287 and NT-174634 to NT-174647, inclusive, of the Registry of Deeds of Nueva Ecija) including all liens and encumbrances annotated thereon;

2. Ordering defendants to surrender their owner's duplicate copies of all the said subsequent transfer certificates of titles emanating from Original Certificate of Title No. P-4522 to the Register of Deeds of Nueva Ecija, and ordering the Register of Deeds to cancel the aforesaid certificates of titles;

3. Ordering reversion of the pieces of land embraced in Free Patent No. 314450 and OCT No. P-4522 of the Registry of Deeds of Nueva Ecija, to the mass of public domain except the pieces of land which were already the subject of land registration proceedings;

4. Ordering that henceforth the defendants and all those claiming under them to desist from disturbing the ownership of the government over the said pieces of land, and

5. To pay costs of suits.

For lack of evidence, the third-party complaint filed by the Rural Bank of Gapan, Inc. against defendants-Spouses Blandino Salva Cruz and Josefina Salva Cruz is hereby dismissed without pronouncement as to costs.

SO ORDERED (Underscoring supplied).

Therefrom, the spouses Eduardo Dee and Arcelita Marquez-Dee and the Rural Bank of Gapan, Nueva Ecija went to the Court of Appeals, whereat their recourse was docketed asCA-G.R. CV No. 55732.

As earlier stated herein, the appellate court, in a decision dated September 26, 2002,[6]reversed and set aside the appealed decision of the trial court, to wit:

WHEREFORE, premises considered, the appeal isGRANTEDand the decision of the trial court isREVERSED and SET ASIDE. A new judgment is hereby rendered to read as follows:

1. Defendant Gregorio Agunoy, Sr. is declared to have validly and properly acquired Free Patent No. 314450 and the corresponding Original Certificate of Title No. P-4522 over Lot Nos. 1341 and 1342, Cad 269, Sta. Rosa Cadastre, Nueva Ecija; and

2. The title over the portion of Lot No. 1342, now covered by TCT No. 196579 in the name of defendants-appellants Spouses Dee is likewise declared valid for having acquired in good faith and for value.

SO ORDERED.

Hence, this recourse by the petitioner, submitting for our resolution the following issues[7]:

I.WHETHER OR NOT THE COURT OF APPEALS ERRED IN DECLARING THAT PETITIONER IS NOT THE REAL PARTY-IN-INTEREST IN THIS CASE AND THAT GREGORIO AGUNOY, SR. HAD VALIDLY ACQUIRED FREE PATENT NO. 314450 AND ORIGINAL CERTIFICATE OF TITLE NO. P-4522 OVER LOT NOS. 1341 AND 1342, CAD. 269, STA. ROSA CADASTRE, NUEVA ECIJA.

II.WHETHER OR NOT THE COURT OF APPEALS ERRED IN DECLARING THAT THE TITLE OVER THE PORTION OF LOT NO. 1342, NOW COVERED BY TCT NO. 196579 IN THE NAMES OF RESPONDENTS SPOUSES EDUARDO DEE AND ARCELITA MARQUEZ IS VALID FOR HAVING BEEN ACQUIRED IN GOOD FAITH AND FOR VALUE.

WeDENY.

To begin with, we agree with the Court of Appeals that petitioner Republic is not the real party-in-interest in this case.Basic it is in the law of procedure that every action must be prosecuted or defended in the name of the real party-in-interest, meaning the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit,[8]a procedural rule reechoed in a long line of cases decided by this Court. For sure, not too long ago, inShipside, Inc. vs. Court of Appeals,[9]citing earlier cases, we wrote:

xxx.Consequently, the Republic is not a real party in interest and it may not institute the instant action. Nor may it raise the defense of imprescriptibility, the same being applicable only in cases where the government is a party in interest. Under Section 2 of Rule 3 of the 1997 Rules of Civil Procedure, "every action must be prosecuted or defended in the name of the real party in interest." To qualify a person to be a real party in interest in whose name an action must be prosecuted, he must appear to be the present real owner of the right sought to enforced (Pioneer Insurance v. CA, 175 SCRA 668 [1989]). A real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. And by real interest is meant a present substantial interest, as distinguished from a mere expectancy, or a future, contingent, subordinate or consequential interest.

The very complaint in this case,supra, filed by petitioner Republic before the trial court unmistakably alleges that at the time Free Patent No. 31445 and its corresponding Original Certificate of Title No. P-45222 were issued to Gregorio Agunoy, Sr., the property in question (Lots 1341 and 1342) xxx was already adjudicated asprivate propertyof the heirs of Eusebio Perez and Valeriano Espiritu, and that at that time, the property in question was no longer a disposable public land. In fact, in paragraph 27(f) of the same complaint, petitioner further alleged:

f) Furthermore, it was found that prior to the issuance of Free Patent No. 314450 on January 18, 1967, Lot 1341 of Sta. Rosa Cadastre, Nueva Ecija, which was one of the two (2) parcels of land applied for by Gregorio Agunoy, Sr., was already the subject of an application for registration filed by the heirs of Eusebio Perez in 1958 before the Court of First Instance of Nueva Ecija, docketed as LRC Case No. 430, LRC Record No. 14876, and wherein a Decision was promulgated on October 24, 1960 adjudicating Lots 1 and 2 of Plan Psu-47200as private propertiesof said heirs-claimants.The aforesaid Decision was already final and executory at the time the patent was issued to defendant Gregorio Agunoy, Sr. (Except for the underscoring on as private properties, the rest are of the petitioner itself).

With the very admissions by the petitioner itself in its basic pleading that Lots No. 1341 and 1342 are alreadyprivate propertiesof the heirs of Eusebio Perez and Valeriano Espiritu, and are, therefore, no longer disposable public landover which the then Bureau of Lands, now Lands Management Bureau, no longer had any jurisdiction and control, we are simply at a loss to understand how petitioner Republic can still profess to be the real party-in-interest in this case, and insists that the disputed properties are still part of the public domain. If ever, the real party-in-interest could be none other than the heirs of Eusebio Perez and Valeriano Espiritu, but certainly not the petitioner.

Then, too, it is striking to note that even as the complaint is basically one for reversion of private property to the mass of public domain, petitioner did not implead either the heirs of Eusebio Perez or that of Valeriano Espiritu. Without doubt, if our decision hereon were to be in favor of petitioner, the real beneficiary thereof is not the State. And because, as no less admitted by the petitioner, the lands subject of this case are no longer part of the public domain, the nullification of Agunoys Free Patent P-314450 and OCT No. P-4522 would not result in the reversion of the lands subject thereof to the mass of public land. And the government, not being the real party-in-interest, is without personality to institute reversion proceedings. So it is that in an earlier case,[10]we had an occasion to say:

There is no merit in petitioners' contention that only the State may bring an action for reconveyance of the lots in dispute. To reiterate, Lot 2344 is a private property in open, continuous, exclusive and notorious possession of the Santiago family. The nullification of its free patent and title would not therefore result in its reversion to the public domain. Hence, the State, represented by the Solicitor General, is not the real party in interest.

We could have, at this point, already writtenfinisto this decision. Nonetheless, for the peace of mind of those concerned, we have opted to address the second issue raised in the petition: whether the appellate court erred in declaring as valid for having been acquired for value and in good faith the title over the portion of Lot No. 1342, covered by TCT No. 196579 in the name of the respondent spouses Eduardo Dee and Arcelita Marquez-Dee.After sleeping for an unreasonably long period of time lasting for decades, the heirs of Eusebio Perez can longer defeat the better right arising from the Torrens titles in the names of the present transferees of the properties, unless and until anyone succeeds in overcoming the presumption of good faith in securing their respective titles.For one, even granting as true the petitioners allegation of a prior cadastral case -LRC Case No. 430, LRC Rec. No. 148- involving a portion of the lots subject of Agunoys Free Patent, wherein a decision was allegedly promulgated onOctober 24, 1960in favor of the heirs of Eusebio Perez, which decision, according to petitioner, was already final and executory, we are greatly bothered by the fact that none of the heirs of Eusebio Perez could show having exerted due diligence towards at least attempting to accomplish the registration of the properties involved in the said cadastral case, which properties, according to petitioner and the Perezes, are identical to Lot Nos. 1341 and 1342. Verily, were we to believe the allegations of the heirs of Eusebio Perez in their own protest with the Bureau of Lands dated July 30, 1975,[11]there is an express order for registration in LRC Case No. 430, as follows:

WHEREFORE, decision is hereby rendered affirming the order of general default heretofore entered and ordering the registration of Lots Nos. 1 and 2 of Plan Psu-47200, situated in the Barrio of Marawa, Municipality of Jaen, Nueva Ecija, containing a total area of 21.9284 hectares in the following manner:

xxx xxx xxx

From as early as October 24, 1960, when the aforequoted decision in LRC Case No. 430 was promulgated, to as late as February 6, 1967, when OCT No. P-4522 of Gregorio Agunoy, Sr. was issued, or a slumber lasting for more than six (6) years, the heirs of Eusebio Perez had numerous opportunities to cause the implementation of the said registration order. Inexplicably, they let this chance passed by.Vigilantibus, sed non dormientibus, jura subveniunt, the law aids the vigilant, not those who sleep on their rights.[12]And speaking of rights, one may not sleep on a right while expecting to preserve it in its pristine purity.[13]For another, Jose Mendigoria, Public Lands Inspector and Investigator of the Bureau of Lands, made the following remarks in his certification datedFebruary 28, 1966:[14]10. Remarks:Attached hereto is the certification of the Clerk of Court and the Register of Deeds, Cabanatuan City for ready references in connection with the speedy issuance of patent in favor of the applicant.It is informed in this connection that the survey claimants of these Lots, 1341 for Eusebio Perez and 1342 for Valenciano Espiritu could not be located in the locality. The lots were already abandoned by them so that in the year 1941, the present applicant took possession of the land thru his tenants.Countering the foregoing certification, petitioner Republic claims that a more recent verification survey conducted onFebruary 15, 1988by Geodetic Engineer Melencio Mangahas, also of the Bureau of Lands, reveals an anomaly in the issuance of Agunoy, Sr.s Free Patent No. 314450. Again, we quote from petitioners complaint, particularly paragraph 27 (c) thereof, to wit:

c) The results of the verification survey conducted by Geodetic Engineer Melencio Mangahas of the Bureau of Lands on February 15, 1988 on the premises confirmed the earlier findings of said Office that Lot 1341 Cad. 269 of Sta. Rosa Cadastre, Nueva Ecija, covered by Free Patent No. 314450 and OCT No. P-4522 in the name of Gregorio Agunoy, Sr., is identical to Lots 1, 3 and a portion of 87,674 square meters of Lot 4 of the amended Plan Psu-47200 which was surveyed and approved on January 21, 1966 in the name of Eusebio Perez. It was verified likewise that Lot 1341 is within Barrio Marawa, Jaen, Nueva Ecija.

As between theFebruary 28, 1966certification of Jose Mendigoria,supra,which led to the issuance of Agunoys OCT No. P-4522 and numerous derivative titles descending therefrom, and theFebruary 15, 1988verification survey of Geodetic Engineer Melencio Mangahas, cited in the aforequoted paragraph of petitioners complaint, which led to nothing, suffice it to quote herein what this Court has said inPEZA vs. Fernandez:[15]xxx. Indeed, the inevitable consequences of the Torrens system of land registration must be upheld in order to give stability to it and provide finality to land disputes,and inHeirs of Brusas vs. Court of Appeals:[16]The real purpose of the Torrens System of land registration is to quiet title to land and stop forever any question as to its legality. Once a title is registered the owner may rest secure without the necessity of waiting in the portals of the court, or sitting on themirador de su casa, to avoid the possibility of losing his land. Indeed, titles over lands under the Torrens system should be given stability for on it greatly depends the stability of the country's economy.Interest reipublicae ut sit finis litium.

If at all, the discrepancy in the two (2) separate survey reports of Mendigoria and Mangahas can only be imputable to either the past or more recent officials of the Bureau of Lands.

Of course, we are well aware of the rule reiterated inRepublic vs. Court of Appeals and Santos,[17]that, generally, the State cannot be put in estoppel by the mistakes or errors of its officials or agents. In that very case, however, citing 31 CJS 675-676, we went further by saying -

xxx.Nevertheless, the government must not be allowed to deal dishonorably or capriciously with its citizens, and must not play an ignoble part or do a shabby thing; and subject to limitations xxx, the doctrine of equitable estoppel may be invoked against public authorities as well as against private individuals

In any event, the verification survey conducted by Geodetic Engineer Melencio Mangahas on February 15, 1988 came almost twenty-two (22) years after the February 28, 1966 certification of Jose Mendigoria; more than twenty-one (21) years after the issuance of Agunoy Sr.s Free Patent No. 314450 on January 18, 1967 and its registration as Original Certificate of Title No. P-4522 on February 6, 1967; and more than eight (8) years reckoned from July 31, 1979 when, upon the death of the wife of Gregorio Agunoy, Sr., the heirs executed a Deed of Extrajudicial Partition with Sale in favor of Joaquin Sangabol. In the meanwhile, for about half a decade thereafter, ownership over the properties transferred from one buyer to another, with each and every transferee enjoying the presumption of good faith. If only on this score alone that the present petition must fall.There can be no debate at all on petitioners submission that no amount of legal technicality may serve as a solid foundation for the enjoyment of the fruits of fraud. It is thus understandable why petitioner chants the dogma offraus et jus nunquam cohabitant.Significantly, however, in the cases cited by petitioner Republic,[18]as well as in those other cases[19]where the doctrine offraus et jus nunquam cohabitantwas applied against a patent and title procured thru fraud or misrepresentation, we note that the land covered thereby is either a part of the forest zone which is definitely non-disposable, as inAnimas, or that said patent and title are still in the name of the person who committed the fraud or misrepresentation, as inAcot, Animas, Republic vs. CA and Del MundoandDirector of Lands vs. Abanilla, et al.and, in either instance, there were yet no innocent third parties standing in the way.

Here, it bears stressing that, by petitioners own judicial admission, the lots in dispute are no longer part of the public domain, and there are numerous third, fourth, fifth and more parties holding Torrens titles in their favor and enjoying the presumption of good faith. This brings to mind what we have reechoed inPino vs. Court of Appeals[20]and the cases[21]therein cited:

[E]ven on the supposition that the sale was void, the general rule that the direct result of a previous illegal contract cannot be valid (on the theory that the spring cannot rise higher than its source) cannot apply here for We are confronted with the functionings of the Torrens System of Registration. The doctrine to follow is simple enough: a fraudulent or forged document of sale may become the ROOT of a valid title if the certificate of title has already been transferred from the name of the true owner to the name of the forger or the name indicated by the forger.

It is even worse in this case because here, there is no forger to speak of. The remark of Land Inspector Jose Mendigoria about the abandonment by Eusebio Perez and Valenciano Espiritu cannot, by itself, be fraudulent. And, for all we know, that remark may even turn out to be the truth. What petitioner perceives as fraud may be nothing more than the differences of professional opinions between Land Inspector Jose Mendigoria and Geodetic Engineer Melencio Mangahas. But regardless of who between the two is correct, the hard reality is that the properties in question are no longer floating objects on aspring that cannot rise higher than its source, as they are now very much ashore and firmly standing on the high solid ground of the Torrens system of land registration.

Malabanan v RepublicSection 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.On20 February 1998, Mario Malabanan filed an application for land registration covering a parcel of land identified asLot9864-A, Cad-452-D, Silang Cadastre,[2]situated in Barangay Tibig, Silang Cavite, and consisting of 71,324 square meters. Malabanan claimed that he had purchased the property from Eduardo Velazco,[3]and that he and his predecessors-in-interest had been in open, notorious, and continuous adverse and peaceful possession of the land for more than thirty (30) years.

The application was raffled to the Regional Trial Court of (RTC)Cavite-TagaytayCity, Branch 18. The Office of the Solicitor General (OSG) duly designated the Assistant Provincial Prosecutor of Cavite, Jose Velazco, Jr., to appear on behalf of the State.[4]Apart from presenting documentary evidence, Malabanan himself and his witness, Aristedes Velazco, testified at the hearing. Velazco testified that the property was originally belonged to a twenty-two hectare property owned by his great-grandfather, Lino Velazco. Lino had four sons Benedicto, Gregorio, Eduardo and Estebanthe fourth being Aristedess grandfather. Upon Linos death, his four sons inherited the property and divided it among themselves. But by 1966, Estebans wife,Magdalena, had become the administrator of all the properties inherited by the Velazco sons from their father, Lino. After the death of Esteban andMagdalena, their son Virgilio succeeded them in administering the properties, includingLot9864-A, which originally belonged to his uncle, Eduardo Velazco. It was this property that was sold by Eduardo Velazco to Malabanan.[5]

Assistant Provincial Prosecutor Jose Velazco, Jr. did not cross-examine Aristedes Velazco. He further manifested that he also [knew] the property and I affirm the truth of the testimony given by Mr. Velazco.[6]The Republic of thePhilippineslikewise did not present any evidence to controvert the application.

Among the evidence presented by Malabanan during trial was a Certification dated 11 June 2001, issued by the Community Environment & Natural Resources Office, Department of Environment and Natural Resources (CENRO-DENR), which stated that the subject property was verified to be within the Alienable or Disposable land per Land Classification Map No. 3013 established under Project No. 20-A and approved as such under FAO 4-1656on March 15, 1982.[7]

On3 December 2002, the RTC rendered judgment in favor of Malabanan, the dispositive portion of which reads:

WHEREFORE, this Court hereby approves this application for registration and thus places under the operation of Act 141, Act 496 and/or P.D. 1529, otherwise known as Property Registration Law, the lands described in Plan Csd-04-0173123-D, Lot 9864-A and containing an area of Seventy One Thousand Three Hundred Twenty Four (71,324) Square Meters, as supported by its technical description now forming part of the record of this case, in addition to other proofs adduced in the name of MARIO MALABANAN, who is of legal age, Filipino, widower, and with residence at Munting Ilog, Silang, Cavite.

Once this Decision becomes final and executory, the corresponding decree of registration shall forthwith issue.

SO ORDERED.

The Republic interposed an appeal to the Court of Appeals, arguing that Malabanan had failed to prove that the property belonged to the alienable and disposable land of the public domain, and that the RTC had erred in finding that he had been in possession of the property in the manner and for the length of time required by law for confirmation of imperfect title.

On23 February 2007, the Court of Appeals rendered a Decision[8]reversing the RTC and dismissing the application of Malabanan. The appellate court held that under Section 14(1) of the Property Registration Decree any period of possession prior to the classification of the lots as alienable and disposable was inconsequential and should be excluded from the computation of the period of possession. Thus, the appellate court noted that since the CENRO-DENR certification had verified that the property was declared alienableanddisposableonlyon15March1982,the Velazcos possession prior to that date could not be factored in the computation of the period of possession. This interpretation of the Court of Appeals of Section 14(1) of the Property Registration Decree was based on the Courts ruling inRepublic v. Herbieto.[9]

Malabanan died while the case was pending with the Court of Appeals;[10]hence, it was his heirs who appealed the decision of the appellate court. Petitioners, before this Court, rely on our ruling inRepublic v. Naguit,[11]which was handed down just four months prior toHerbieto. Petitioners suggest that the discussion inHerbietocited by the Court of Appeals is actuallyobiter dictumsince the Metropolitan Trial Court therein which had directed the registration of the property had no jurisdiction in the first place since the requisite notice of hearing was published only after the hearing had already begun.Naguit, petitioners argue, remains the controlling doctrine, especially when the property in question is agricultural land. Therefore, with respect to agricultural lands, any possession prior to the declaration of the alienable property as disposable may be counted in reckoning the period of possession to perfect title under the Public Land Act and the Property Registration Decree.

The petition was referred to the Courten banc,[12]and on11 November 2008, the case was heard on oral arguments. The Court formulated the principal issues for the oral arguments, to wit:

1.In order that an alienable and disposable land of the public domain may be registered under Section 14(1) of Presidential Decree No. 1529, otherwise known as the Property Registration Decree, should the land be classified as alienable and disposable as of June 12, 1945 or is it sufficient that such classification occur at any time prior to the filing of the applicant for registration provided that it is established that the applicant has been in open, continuous, exclusive and notorious possession of the land under abona fideclaim of ownership since June 12, 1945 or earlier?

2.For purposes of Section 14(2) of the Property Registration Decree may a parcel of land classified as alienable and disposable be deemed private land and therefore susceptible to acquisition by prescription in accordance with the Civil Code?

3.May a parcel of land established as agricultural in character either because of its use or because its slope is below that of forest lands be registrable under Section 14(2) of the Property Registration Decree in relation to the provisions of the Civil Code on acquisitive prescription?

4.Are petitioners entitled to the registration of the subject land in their names under Section 14(1) or Section 14(2) of the Property Registration Decree or both?[13]

Based on these issues, the parties formulated their respective positions.

With respect to Section 14(1), petitioners reiterate that the analysis of the Court inNaguitis the correct interpretation of the provision. The seemingly contradictory pronouncement inHerbieto, it is submitted, should be consideredobiter dictum,since the land registration proceedings therein was voidab initiodue to lack of publication of the notice of initial hearing. Petitioners further point out that inRepublic v. Bibonia,[14]promulgated in June of 2007, the Court appliedNaguitand adopted the same observation that the preferred interpretation by the OSG of Section 14(1) was patently absurd. For its part, the OSG remains insistent that for Section 14(1) to apply, the land should have been classified as alienable and disposable as of12 June 1945. Apart fromHerbieto, the OSG also cites the subsequent rulings inBuenaventura v. Republic,[15]Fieldman Agricultural Trading v. Republic[16]andRepublic v. Imperial Credit Corporation,[17]as well as the earlier case ofDirector of Lands v. Court of Appeals.[18]

With respect to Section 14(2), petitioners submit that open, continuous, exclusive and notorious possession of an alienable land of the public domain for more than 30 yearsipso jureconverts the land into private property, thus placing it under the coverage of Section 14(2). According to them, it would not matter whether the land sought to be registered was previously classified as agricultural land of the public domain so long as, at the time of the application, the property had already been converted into private property through prescription. To bolster their argument, petitioners cite extensively from our 2008 ruling inRepublic v. T.A.N. Properties.[19]

The arguments submitted by the OSG with respect to Section 14(2) are more extensive. The OSG notes that under Article 1113 of the Civil Code, the acquisitive prescription of properties of the State refers to patrimonial property, while Section 14(2) speaks of private lands. It observes that the Court has yet to decide a case that presented Section 14(2) as a ground for application for registration, and that the 30-year possession period refers to the period of possession under Section 48(b) of the Public Land Act, and not the concept of prescription under the Civil Code. The OSG further submits that, assuming that the 30-year prescriptive period can run against public lands, said period should be reckoned from the time the public land was declared alienable and disposable.

Both sides likewise offer special arguments with respect to the particular factual circumstances surrounding the subject property and the ownership thereof.

II.

First, we discuss Section 14(1) of the Property Registration Decree. For a full understanding of the provision, reference has to be made to the Public Land Act.

A.

Commonwealth Act No. 141, also known as the Public Land Act, has, since its enactment, governed the classification and disposition of lands of the public domain. The President is authorized, from time to time, to classify the lands of the public domain into alienable and disposable, timber, or mineral lands.[20]Alienable and disposable lands of the public domain are further classified according to their uses into (a) agricultural; (b) residential, commercial, industrial, or for similar productive purposes; (c) educational, charitable, or other similar purposes; or (d) reservations for town sites and for public and quasi-public uses.[21]

May a private person validly seek the registration in his/her name of alienable and disposable lands of the public domain? Section 11 of the Public Land Act acknowledges that public lands suitable for agricultural purposes may be disposed of by confirmation of imperfect or incomplete titles through judicial legalization.[22]Section 48(b) of the Public Land Act, as amended by P.D. No. 1073, supplies the details and unmistakably grants that right, subject to the requisites stated therein:

5452Sec. 48. The following described citizens of the Philippines, occupying lands of the public domain or claiming to own any such land or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration Act, to wit:

xxx

(b)Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of alienable and disposable lands of the public domain, under a bona fide claim of acquisition of ownership, since June 12, 1945, or earlier, immediately preceding the filing of the application for confirmation of title except when prevented by war or force majeure. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this chapter.

Section 48(b) of Com. Act No. 141 received its present wording in 1977 when the law was amended by P.D. No. 1073. Two significant amendments were introduced by P.D. No. 1073.First, the term agricultural lands was changed to alienable and disposable lands of the public domain. The OSG submits that this amendment restricted the scope of the lands that may be registered.[23]This is not actually the case. Under Section 9 of the Public Land Act, agricultural lands are a mere subset of lands of the public domain alienable or open to disposition. Evidently, alienable and disposable lands of the public domain are a larger class than only agricultural lands.

Second, the length of the requisite possession was changed from possession for thirty (30) years immediately preceding the filing of the application to possession sinceJune 12, 1945or earlier. The Court inNaguitexplained:

When the Public Land Act was first promulgated in 1936, the period of possession deemed necessary to vest the right to register their title to agricultural lands of the public domain commenced fromJuly 26, 1894. However, this period was amended by R.A. No. 1942, which provided that thebona fideclaim of ownership must have been for at least thirty (30) years. Then in 1977, Section 48(b) of the Public Land Act was again amended, this time by P.D. No. 1073, which pegged the reckoning date atJune 12, 1945. xxx

It bears further observation that Section 48(b) of Com. Act No, 141 is virtually the same as Section 14(1) of the Property Registration Decree. Said Decree codified the various laws relative to the registration of property, including lands of the public domain. It is Section 14(1) that operationalizes the registration of such lands of the public domain. The provision reads:

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 abona fideclaim of ownership since June 12, 1945, or earlier.

Notwithstanding the passage of the Property Registration Decree and the inclusion of Section 14(1) therein, the Public Land Act has remained in effect. Both laws commonly refer to persons or their predecessors-in-interest who have been in open, continuous, exclusive and notorious possession and occupation of alienable and disposable lands of the public domain under abona fideclaim of ownership sinceJune 12, 1945, or earlier. That circumstance may have led to the impression that one or the other is a redundancy, or that Section 48(b) of the Public Land Act has somehow been repealed or mooted. That is not the case.

The opening clauses of Section 48 of the Public Land Act and Section 14 of the Property Registration Decree warrant comparison:

Sec. 48 [of thePublicLandAct]. The following described citizens of the Philippines, occupying lands of the public domain or claiming to own any such land or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration Act, to wit:

xxx

Sec. 14 [of the Property Registration Decree]. 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:

xxx

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

Section 48 can be viewed in conjunction with the afore-quoted Section 11 of the Public Land Act, which provides that public lands suitable for agricultural purposes may be disposed of by confirmation of imperfect or incomplete titles, and given the notion that both provisions declare that it is indeed the Public Land Act that primarily establishes the substantive ownership of the possessor who has been in possession of the property since 12 June 1945. In turn, Section 14(a) of the Property Registration Decree recognizes the substantive right granted under Section 48(b) of the Public Land Act, as well provides the corresponding original registration procedure for the judicial confirmation of an imperfect or incomplete title.

There is another limitation to the right granted under Section 48(b). Section 47 of the Public Land Act limits the period within which one may exercise the right to seek registration under Section 48. The provision has been amended several times, most recently by Rep. Act No. 9176 in 2002.It currently reads thus:

Section 47. The persons specified in the next following section are hereby granted time, not to extend beyond December 31, 2020 within which to avail of the benefits of this Chapter:Provided, That this period shall apply only where the area applied for does not exceed twelve (12) hectares:Provided, further, That the several periods of time designated by the President in accordance with Section Forty-Five of this Act shall apply also to the lands comprised in the provisions of this Chapter, but this Section shall not be construed as prohibiting any said persons from acting under this Chapter at any time prior to the period fixed by the President.[24]

Accordingly under the current state of the law, the substantive right granted under Section 48(b) may be availed of only until31 December 2020.

B.

Despite the clear text of Section 48(b) of the Public Land Act, as amended and Section 14(a) of the Property Registration Decree, the OSG has adopted the position that for one to acquire the right to seek registration of an alienable and disposable land of the public domain, it is not enough that the applicant and his/her predecessors-in-interest be in possession under abona fideclaim of ownership since 12 June 1945; the alienable and disposable character of the property must have been declared also as of 12 June 1945. Following the OSGs approach,all lands certified as alienable and disposable after12 June 1945cannot be registered either under Section 14(1) of the Property Registration Decree or Section 48(b) of the Public Land Act as amended. The absurdity of such an implication was discussed inNaguit.

Petitioner suggests an interpretation that the alienable and disposable character of the land should have already been established sinceJune 12, 1945or earlier. This is not borne out by the plain meaning of Section 14(1). SinceJune 12, 1945, as used in the provision, qualifies its antecedent phrase under a bonafide claim of ownership. Generally speaking, qualifying words restrict or modify only the words or phrasestowhichtheyareimmediately associated, and not those distantly or remotely located.[25]Ad proximum antecedentsfiat relation nisi impediatur sentencia.

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

Accordingly, the Court inNaguitexplained:

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

The Court declares that the correct interpretation of Section 14(1) is that which was adopted inNaguit. The contrary pronouncement inHerbieto, as pointed out inNaguit, absurdly limits the application of the provision to the point of virtual inutility since it would only cover lands actually declared alienable and disposable prior to 12 June 1945, even if the current possessor is able to establish open, continuous, exclusive and notorious possession under abona fideclaim of ownership long before that date.

Moreover, theNaguitinterpretation allows more possessors under abona fideclaim of ownership to avail of judicial confirmation of their imperfect titles than what would be feasible underHerbieto. This balancing fact is significant, especially considering our forthcoming discussion on the scope and reach of Section 14(2) of the Property Registration Decree.

Petitioners make the salient observation that the contradictory passages fromHerbietoareobiter dictasince the land registration proceedings therein is voidab initioin the first place due to lack of the requisite publication of the notice of initial hearing. There is no need to explicitly overturnHerbieto, as it suffices that the Courts acknowledgment that the particular line of argument used therein concerning Section 14(1) is indeedobiter.

It may be noted that in the subsequent case ofBuenaventura,[26]the Court, citingHerbieto, again stated that [a]ny period of possession prior to the date when the [s]ubject [property was] classified as alienable and disposable is inconsequential and should be excluded from the computation of the period of possession That statement, in the context of Section 14(1), is certainly erroneous. Nonetheless, the passage as cited inBuenaventurashould again be considered asobiter. The application therein was ultimately granted, citing Section 14(2). The evidence submitted by petitioners therein did not establish any mode of possession on their part prior to 1948, thereby precluding the application of Section 14(1). It is not even apparent from the decision whether petitioners therein had claimed entitlement to original registration following Section 14(1), their position being that they had been in exclusive possession under a bona fide claim of ownership for over fifty (50) years, butnot before12 June 1945.

Thus, neitherHerbietonor its principal discipular rulingBuenaventurahas any precedental value with respect to Section 14(1). On the other hand, the ratio ofNaguitis embedded in Section 14(1), since it precisely involved situation wherein the applicant had been in exclusive possession under abona fideclaim of ownership prior to12 June 1945. The Courts interpretation of Section 14(1) therein was decisive to the resolution of the case. Any doubt as to which betweenNaguitorHerbietoprovides the final word of the Court on Section 14(1) is now settled in favor ofNaguit.

We noted inNaguitthat it should be distinguished fromBracewell v. Court of Appeals[27]since in the latter, the application for registration had been filedbeforethe land was declared alienable or disposable. The dissent though pronouncesBracewellas the better rule between the two. Yet two years afterBracewell, itsponente, the esteemedJustice Consuelo Ynares-Santiago, penned the ruling inRepublic v. Ceniza,[28]which involved a claim of possession that extended back to 1927 over a public domain land that was declared alienable and disposable only in 1980.CenizacitedBracewell, quoted extensively from it, and following the mindset of the dissent, the attempt at registration inCenizashould have failed. Not so.

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

In this case, private respondents presented a certification dated November 25, 1994, issued by Eduardo M. Inting, the Community Environment and Natural Resources Officer in the Department of Environment and Natural Resources Office in Cebu City, stating that the lots involved were "found to be within the alienable and disposable (sic) Block-I, Land Classification Project No. 32-A, per map 2962 4-I555 dated December 9, 1980."This is sufficient evidence to show the real character of the land subject of private respondents application. Further, the certification enjoys a presumption of regularity in the absence of contradictory evidence,which is true in this case. Worth noting also was the observation of the Court of Appeals stating that:

[n]o opposition was filed by the Bureaus of Lands and Forestry to contest the application of appellees on the ground that the property still forms part of the public domain. Nor is there any showing that the lots in question are forestal land....

Thus, while the Court of Appeals erred in ruling that mere possession of public land for the period required by law would entitle its occupant to a confirmation of imperfect title, it did not err in ruling in favor of private respondents as far as the first requirement in Section 48(b) of the Public Land Act is concerned, for they were able to overcome the burden of proving the alienability of the land subject of their application.

As correctly found by the Court of Appeals, private respondents were able to prove their open, continuous, exclusive and notorious possession of the subject land even before the year 1927. As a rule, we are bound by the factual findings of the Court of Appeals. Although there are exceptions, petitioner did not show that this is one of them.[29]

Why did the Court inCeniza, through the same eminent member who authoredBracewell, sanction the registration under Section 48(b) of public domain lands declared alienable or disposable thirty-five (35) years and 180 days after12 June 1945? The telling difference is that inCeniza, the application for registration was filed nearly six (6) yearsafterthe land had been declared alienable or disposable, while inBracewell, the application was filed nine (9) yearsbefore the land was declared alienable or disposable.That crucial difference was also stressed inNaguitto contradistinguish it fromBracewell, a difference which the dissent seeks to belittle.

III.

We next ascertain the correct framework of analysis with respect to Section 14(2). The provision reads:

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:

xxx

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

The Court inNaguitoffered the following discussion concerning Section 14(2), which we did even then recognize, and still do, to beanobiter dictum,but we nonetheless refer to it as material for further discussion, thus:

Did the enactment of the Property Registration Decree and the amendatory P.D. No. 1073 preclude the application for registration of alienable lands of the public domain, possession over which commenced only afterJune 12, 1945? It did not, considering Section 14(2) of the Property Registration Decree, which governs and authorizes the application of those who have acquired ownership of private lands by prescription under the provisions of existing laws.

Prescription is one of the modes of acquiring ownership under the Civil Code.[[30]] There is a consistent jurisprudential rule that properties classified as alienable public land may be converted into private property by reason of open, continuous and exclusive possession of at least thirty (30) years.[[31]] With such conversion, such property may now fall within the contemplation of private lands under Section 14(2), and thus susceptible to registration by those who have acquired ownership through prescription. Thus, even if possession of the alienable public land commenced on a date later thanJune 12, 1945, and such possession being been open, continuous and exclusive, then the possessor may have the right to register the land by virtue of Section 14(2) of the Property Registration Decree.

Naguitdid not involve the application of Section 14(2), unlike in this case where petitioners have based their registration bid primarily on that provision, and where the evidence definitively establishes their claim of possession only as far back as 1948. It is in this case that we can properly appreciate the nuances of the provision.

A.

Theobiterin Naguit cited the Civil Code provisions on prescription as the possible basis for application for original registration under Section 14(2). Specifically, it is Article 1113 which provides legal foundation for the application. It reads:

All things which are within the commerce of men are susceptible of prescription, unless otherwise provided. Property of the State or any of its subdivisions not patrimonial in character shall not be the object of prescription.

It is clear under the Civil Code that where lands of the public domain are patrimonial in character, they are susceptible to acquisitive prescription. On the other hand, among the public domain lands that are not susceptible to acquisitive prescription are timber lands and mineral lands. The Constitution itself proscribes private ownership of timber or mineral lands.

There are in fact several provisions in the Civil Code concerning the acquisition of real property through prescription. Ownership of real property may be acquired by ordinary prescription of ten (10) years,[32]or through extraordinary prescription of thirty (30) years.[33]Ordinary acquisitive prescription requires possession in good faith,[34]as well as just title.[35]

When Section 14(2) of the Property Registration Decree explicitly provides that persons who have acquired ownership over private lands by prescription under the provisions of existing laws, it unmistakably refers to the Civil Code as a valid basis for the registration of lands. The Civil Code is the only existing law that specifically allows the acquisition by prescription of private lands, including patrimonial property belonging to the State. Thus, the critical question that needs affirmation is whether Section 14(2) does encompass original registration proceedings over patrimonial property of the State, which a private person has acquired through prescription.

The Naguitobiterhad adverted to a frequently reiterated jurisprudence holding that properties classified as alienable public land may be converted into private property by reason of open, continuous and exclusive possession of at least thirty (30) years.[36]Yet if we ascertain the source of the thirty-year period, additional complexities relating to Section 14(2) and to how exactly it operates would emerge. Forthere are in fact two distinct origins of the thirty (30)-year rule.

The first source is Rep. Act No. 1942, enacted in 1957, which amended Section 48(b) of the Public Land Act by granting the right to seek original registration of alienable public lands through possession in the concept of an owner for at least thirty years.

The following-described citizens of the Philippines, occupying lands of the public domain or claiming to own any such lands or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration Act, to wit:

x x x x x x x x x

(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 abona fideclaim of acquisition of ownership,for at least thirty years immediately preceding the filing of the application for confirmation of title, except when prevented by war or force majeure. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this Chapter. (emphasis supplied)[37]

This provision was repealed in 1977 with the enactment of P.D. 1073, which made the date12 June 1945the reckoning point for the first time. Nonetheless, applications for registration filed prior to 1977 could have invoked the 30-year rule introduced by Rep. Act No. 1942.

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

Obviously, the first source of the thirty (30)-year period rule,Rep. Act No. 1942, became unavailable after 1977. At present, the only legal basis for the thirty (30)-year period is the law on prescription under the Civil Code, as mandated under Section 14(2). However, there is a material difference between how the thirty (30)-year rule operated under Rep. Act No. 1942 and how it did under the Civil Code.

Section 48(b) of the Public Land Act, as amended by Rep. Act No. 1942, did not refer to or call into application the Civil Code provisions on prescription. It merely set forth a requisite thirty-year possession period immediately preceding the application for confirmation of title, without any qualification as to whether the property should be declared alienable at the beginning of, and continue as such, throughout the entire thirty-(30) years. There is neither statutory nor jurisprudential basis to assert Rep. Act No. 1942 had mandated such a requirement,[38]similar to our earlier finding with respect to the present language of Section 48(b), which now sets12 June 1945as the point of reference.

Then, with the repeal of Rep. Act No. 1942, the thirty-year possession period as basis for original registration became Section 14(2) of the Property Registration Decree, which entitled those who have acquired ownership over private lands by prescription under the provisions of existing lawsto apply for original registration. Again, the thirty-year period is derived from the rule on extraordinary prescription under Article 1137 of the Civil Code. At the same time, Section 14(2) puts into operation the entire regime of prescription under the Civil Code, a fact which does not hold true with respect to Section 14(1).

B.

Unlike Section 14(1), Section 14(2) explicitly refers to the principles on prescription under existing laws. Accordingly, we are impelled to apply the civil law concept of prescription, as set forth in the Civil Code, in our interpretation of Section 14(2). There is no similar demand on our part in the case of Section 14(1).

The critical qualification under Article 1113 of the Civil Code is thus: [p]roperty of the State or any of its subdivisions not patrimonial in character shall not be the object of prescription. The identification what consists of patrimonial property is provided by Articles 420 and 421, which we quote in full:

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

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

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

Art. 421. All other property of the State, which is not of the character stated in thepreceding article, is patrimonialproperty

It is clear that property of public dominion, which generally includes property belonging to the State, cannot be the object of prescription or, indeed, be subject of the commerce of man.[39]Lands of the public domain, whether declared alienable and disposable or not, are property of public dominion and thus insusceptible to acquisition by prescription.

Let us now explore the effects under the Civil Code of a declaration by the President or any duly authorized government officer of alienability and disposability of lands of the public domain. 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.

It is comprehensible with ease that this reading of Section 14(2) of the Property Registration Decree limits its scope and reach and thus affects the registrability even of lands already declared alienable and disposable to the detriment of thebona fidepossessors or occupants claiming title to the lands. Yet this interpretation is in accord with the Regalian doctrine and its concomitant assumption that all lands owned by the State, although declared alienable or disposable, remain as such and ought to be used only by the Government.

Recourse does not lie with this Court in the matter. The duty of the Court is to apply the Constitution and the laws in accordance with their language and intent. The remedy is to change the law, which is the province of the legislative branch. Congress can very well be entreated to amend Section 14(2) of the Property Registration Decree and pertinent provisions of the Civil Code to liberalize the requirements for judicial confirmation of imperfect or incomplete titles.

The operation of the foregoing interpretation can be illustrated by an actual example. Republic Act No. 7227, entitled An Act Accelerating The Conversion Of Military Reservations Into Other Productive Uses, etc., is more commonly known as the BCDA law.Section 2 of the law authorizes the sale of certain military reservations and portions of military camps in Metro Manila, includingFortBonifacioand Villamor Air Base.For purposes of effecting the sale of the military camps, the law mandates the President to transfer such military lands to the Bases Conversion Development Authority (BCDA)[40]which in turn is authorized to own, hold and/or administer them.[41]The President is authorized to sell portions of the military camps, in whole or in part.[42]Accordingly, the BCDA law itself declares that themilitary lands subject thereof are alienable and disposable pursuant to the provisions of existing laws and regulations governing sales of government properties.[43]

From the moment the BCDA law was enacted the subject military lands have become alienable and disposable. However, said lands did not become patrimonial, as the BCDA law itself expressly makes the reservation that these lands are to be sold in order to raise funds for the conversion of the former American bases atClarkandSubic.[44]Such purpose can be tied to either public service or the development of national wealth under Article 420(2). Thus, at that time, the lands remained property of the public dominion under Article 420(2), notwithstanding their status as alienable and disposable. It is upon their sale as authorized under the BCDA law to a private person or entity that such lands become private property and cease to be property of the public dominion.

C.

Should public domain lands become patrimonial because they are declared as such in a duly enacted law or duly promulgated proclamation that they are no longer intended for public service or for the development of the national wealth, would the period of possession prior to the conversion of such public dominion into patrimonial be reckoned in counting the prescriptive period in favor of the possessors? We rule in the negative.

The limitation imposed by Article 1113 dissuades us from ruling that the period of possession before the public domain land becomes patrimonial may be counted for the purpose of completing the prescriptive period. Possession of public dominion property before it becomes patrimonial cannot be the object of prescription according to the Civil Code. As the application for registration under Section 14(2) falls wholly within the framework of prescription under the Civil Code, there is no way that possession during the time that the land was still classified as public dominion property can be counted to meet the requisites of acquisitive prescription and justify registration.

Are we being inconsistent in applying divergent rules for Section 14(1) and Section 14(2)? There is no inconsistency.Section 14(1) mandates registration on the basis ofpossession,while Section 14(2) entitles registration on the basis ofprescription.Registration under Section 14(1) is extended under the aegis of theProperty Registration Decree and the Public Land Actwhile registration under Section 14(2) is made available both by theProperty Registration Decree and the Civil Code.

In the same manner, we can distinguish between the thirty-year period under Section 48(b) of the Public Land Act, as amended by Rep. Act No. 1472, and the thirty-year period available through Section 14(2) of the Property Registration Decree in relation to Article 1137 of the Civil Code.The period under the former speaks of athirty-year period of possession,while the period under the latter concerns athirty-year period of extraordinary prescription.Registration under Section 48(b) of the Public Land Act as amended by Rep. Act No. 1472 is based on thirty years of possession alone without regard to the Civil Code, while the registration under Section 14(2) of the Property Registration Decree is founded on extraordinary prescription under the Civil Code.

It may be asked why the principles of prescription under the Civil Code should not apply as well to Section 14(1). Notwithstanding the vaunted status of the Civil Code, it ultimately is just one of numerous statutes, neither superior nor inferior to other statutes such as the Property Registration Decree. The legislative branch is not bound to adhere to the framework set forth by the Civil Code when it enacts subsequent legislation. Section 14(2) manifests a clear intent to interrelate the registration allowed under that provision with the Civil Code, but no such intent exists with respect to Section 14(1).

IV.

One of the keys to understanding the framework we set forth today is seeing how our land registration procedures correlate with our law on prescription, which, under the Civil Code, is one of the modes for acquiring ownership over property.

The Civil Code makes it clear that patrimonial property of the State may be acquired by private persons through prescription. This is brought about by Article 1113, which states that [a]ll things which are within the commerce of man are susceptible to prescription, and that [p]roperty of the State or any of its subdivisions not patrimonial in character shall not be the object of prescription.

There are two modes of prescription through which immovables may be acquired under the Civil Code. The first is ordinary acquisitive prescription, which, under Article 1117, requires possession in good faith and with just title; and, under Article 1134, is completed through possession of ten (10) years. There is nothing in the Civil Code that bars a person from acquiring patrimonial property of the State through ordinary acquisitive prescription, nor is there any apparent reason to impose such a rule. At the same time, there are indispensable requisitesgood faith and just title. The ascertainment of good faith involves the application of Articles 526, 527, and 528, as well as Article 1127 of the Civil Code,[45]provisions that more or less speak for themselves.

On the other hand, the concept of just title requires some clarification.Under Article 1129, there is just title for the purposes of prescription when the adverse claimant came into possession of the property through one of the modes recognized by law for the acquisition of ownership or other real rights, but the grantor was not the owner or could not transmit any right. Dr. Tolentino explains:

Just title is an act which has for its purpose the transmission of ownership, and which would have actually transferred ownership if the grantor had been the owner. This vice or defect is the one cured by prescription. Examples: sale with delivery, exchange, donation, succession, anddacionin payment.[46]

The OSG submits that the requirement of just title necessarily precludes the applicability of ordinary acquisitive prescription to patrimonial property. The major premise for the argument is that the State, as the owner and grantor, could not transmit ownership to the possessor before the completion of the required period of possession.[47]It is evident that the OSG erred when it assumed that the grantor referred to in Article 1129 is the State. The grantor is the one from whom the person invoking ordinary acquisitive prescription derived the title, whether by sale, exchange, donation, succession or any other mode of the acquisition of ownership or other real rights.

Earlier, we made it clear that, whether under ordinary prescription or extraordinary prescription, the period of possession preceding the classification of public dominion lands as patrimonial cannot be counted for the purpose of computing prescription. But after the property has been become patrimonial, the period of prescription begins to run in favor of the possessor. Once the requisite period has been completed, two legal events ensue: (1) the patrimonial property isipso jureconverted into private land; and (2) the person in possession for the periods prescribed under the Civil Code acquires ownership of the property by operation of the Civil Code.

It is evident that once the possessor automatically becomes the owner of the converted patrimonial property, the ideal next step is the registration of the property under theTorrenssystem. It should be remembered that registration of property is not a mode of acquisition of ownership, but merely a mode of confirmation of ownership.[48]

Looking back at the registration regime prior to the adoption of the Property Registration Decree in 1977, it is apparent that the registration system then did not fully accommodate the acquisition of ownership of patrimonial property under the Civil Code. What the system accommodated was the confirmation of imperfect title brought about by the completion of a period of possession ordained under the Public Land Act (either 30 years following Rep. Act No. 1942, or since12 June 1945following P.D. No. 1073).

The Land Registration Act[49]was noticeably silent on the requisites for alienable public lands acquired through ordinary prescription under the Civil Code, though it arguably did not preclude such registration.[50]Still, the gap was lamentable, considering that the Civil Code, by itself, establishes ownership over the patrimonial property of persons who have completed the prescriptive periods ordained therein. The gap was finally closed with the adoption of the Property Registration Decree in 1977, with Section 14(2) thereof expressly authorizing original registration in favor of persons who have acquired ownership over private lands by prescription under the provisions of existing laws, that is, the Civil Code as of now.

V.

We synthesize the doctrines laid down in this case, as follows:

(1) In connection with Section 14(1) of the Property Registration Decree, Section 48(b) of the Public Land Act recognizes and confirms that those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of alienable and disposable lands of the public domain, under a bona fide claim of acquisition of ownership, since June 12, 1945 have acquired ownership of, and registrable title to, such landsbased on the length and quality of their possession.

(a)Since Section 48(b) merely requires possession since 12 June 1945 and does not require that the lands should have been alienable and disposable during the entire period of possession, the possessor is entitled to secure judicial confirmation of his title thereto as soon as it is declared alienable and disposable, subject to the timeframe imposed by Section 47 of the Public Land Act.[51]

(b)The right to register granted under Section 48(b) of the Public Land Act is further confirmed by Section 14(1) of the Property Registration Decree.

(2) In complying with Section 14(2) of the Property Registration Decree, consider that under the Civil Code, prescription is recognized as a mode of acquiring ownership of patrimonial property. However, public domain lands become only patrimonial property not only with a declaration that these are alienable or disposable.There must also be an express government manifestation that the property is already patrimonial or no longer retained for public service or the development of national wealth, under Article 422 of the Civil Code. And only when the property has become patrimonial can the prescriptive period for the acquisition of property of the public dominion begin to run.

(a)Patrimonial property is private property of the government.The person acquires ownership of patrimonial property by prescription under the Civil Code is entitled to secure registration thereof under Section 14(2) of the Property Registration Decree.

(b)There are two kinds of prescription by which patrimonial property may be acquired, one ordinary and other extraordinary. Under ordinary acquisitive prescription, a person acquires ownership of a patrimonial property through possession for at least ten (10) years, in good faith and with just title. Under extraordinary acquisitive prescription, a persons uninterrupted adverse possession of patrimonial property for at least thirty (30) years, regardless of good faith or just title, ripens into ownership.

B.

We now apply the above-stated doctrines to the case at bar.

It is clear that the evidence of petitioners is insufficient to establish that Malabanan has acquired ownership over the subject property under Section 48(b) of the Public Land Act. There is no substantive evidence to establish that Malabanan or petitioners as his predecessors-in-interest have been in possession of the property since 12 June 1945 or earlier. The earliest that petitioners can date back their possession, according to their own evidencethe Tax Declarations they presented in particularis to the year 1948. Thus, they cannot avail themselves of registration under Section 14(1) of the Property Registration Decree.

Neither can petitioners properly invoke Section 14(2) as basis for registration. While the subject property was declared as alienable or disposable in 1982, there is no competent evidence that is no longer intended for public use service or for the development of the national evidence, conformably with Article 422 of the Civil Code. The classification of the subject property as alienable and disposable land of the public domain does not change its status as property of the public dominion under Article 420(2) of the Civil Code.Thus, it is insusceptible to acquisition by prescription.

(1) As a general rule and pursuant to the Regalian Doctrine, all lands of the public domain belong to the State and are inalienable. Lands that are not clearly under private ownership are also presumed to belong to the State and, therefore, may not be alienated or disposed;

(2) The following are excepted from the general rule, to wit:

(a) Agricultural lands of the public domain are rendered alienable and disposable through any of the exclusive modes enumerated under Section 11 of the Public Land Act. If the mode is judicial confirmation of imperfect title under Section 48(b) of the Public Land Act, the agricultural land subject of the application needs only to be classified as alienable and disposable as of the time of the application, provided the applicants possession and occupation of the land dated back to June 12, 1945, or earlier. Thereby, a conclusive presumption that the applicant has performed all the conditions essential to a government grant arises,36and the applicant becomes the owner of the land by virtue of an imperfect or incomplete title. By legal fiction, the land has already ceased to be part of the public domain and has become private property.37(b) Lands of the public domain subsequently classified or declared as no longer intended for public use or for the development of national wealth are removed from the sphere of public dominion and are considered converted into patrimonial lands or lands of private ownership that may be alienated or disposed through any of the modes of acquiring ownership under the Civil Code. If the mode of acquisition is prescription, whether ordinary or extraordinary, proof that the land has been already converted to private ownership prior to the requisite acquisitive prescriptive period is a condition sine qua non in observance of the law (Article 1113, Civil Code) that property of the State not patrimonial in character shall not be the object of prescription.

To reiterate, then, the petitioners failed to present sufficient evidence to establish that they and their predecessors-in-interest had been in possession of the land since June 12, 1945. Without satisfying the requisite character and period of possession - possession and occupation that is open, continuous, exclusive, and notorious since June 12, 1945, or earlier - the land cannot be considered ipso jure converted to private property even upon the subsequent declaration of it as alienable and disposable. Prescription never began to run against the State, such that the land has remained ineligible for registration under Section 14(1) of the Property Registration Decree. Likewise, the land continues to be ineligible for land registration under Section 14(2) of the Property Registration Decree unless Congress enacts a law or the President issues a proclamation declaring the land as no longer intended for public service or for the development of the national wealth.1wphi1WHEREFORE, the Court DENIES the petitioners' Motion for Reconsideration and the respondent's Partial Motion for Reconsideration for their lack of merit.

SO ORDERED.