G.R. No. L-15829      December 4, 1967

ROMAN R. SANTOS, petitioner-appellee, vs.HON. FLORENCIO MORENO, as Secretary of Public Works and Communications and JULIAN C. CARGULLO, respondents-appellants.

Gil R. Carlos and Associates for petitioner-appellee.Office of the Solicitor General for respondents-appellants.

BENGZON, J.P., J.:

THE APPEAL

The Honorable Secretary of Public Works & Communications appeals from the decision of the Court of First Instance of Manila declaring of private ownership certain creeks situated in barrio San Esteban, Macabebe, Pampanga.

THE BACKGROUND

The Zobel family of Spain formerly owned vast track of marshland in the municipality of Macabebe, Pampanga province. Called Hacienda San Esteban, it was administered and managed by the Ayala y Cia. From the year 1860 to about the year 1924 Ayala y Cia., devoted the hacienda to the planting and cultivation of nipa palms from which it gathered nipa sap or "tuba." It operated a distillery plant in barrio San Esteban to turn nipa tuba into potable alcohol which was in turn manufactured into liquor.

Accessibility through the nipa palms deep into the hacienda posed as a problem. Ayala y Cia., therefore dug canals leading towards the hacienda's interior where most of them interlinked with each other. The canals facilitated the gathering of tuba and the guarding and patrolling of the hacienda by security guards called "arundines." By the gradual process of erosion these canals acquired the characteristics and dimensions of rivers.

In 1924 Ayala y Cia shifted from the business of alcohol production to bangus culture. It converted Hacienda San Esteban from a forest of nipa groves to a web of fishponds. To do so, it cut down the nipa palm, constructed dikes and closed the canals criss-crossing the hacienda.

Sometime in 1925 or 1926 Ayala y Cia., sold a portion of Hacienda San Esteban to Roman Santos who also transformed the swamp land into a fishpond. In so doing, he closed and built dikes across Sapang Malauling Maragul, Quiñorang Silab, Pepangebunan, Bulacus, Nigui and Nasi.

The closing of the man-made canals in Hacienda San Esteban drew complaints from residents of the surrounding communities. Claiming that the closing of the canals caused floods during the rainy season, and that it deprived them of their means of transportation and fishing grounds, said residents demanded re-opening of those canals. Subsequently, Mayor Lazaro Yambao of Macabebe, accompanied by policemen and some residents went to Hacienda San Esteban and opened the closure dikes at Sapang Malauling Maragul Nigui and Quiñorang Silab. Whereupon, Roman Santos filed Civil Case No. 4488 in the Court of First Instance of Pampanga which preliminarily enjoined Mayor Yambao and others from demolishing the dikes across the canals. The municipal officials of Macabebe countered by filing a complaint (docketed as Civil Case No. 4527) in the same court. The Pampanga Court of First Instance rendered judgment in both cases against Roman Santos who immediately elevated the case to the Supreme Court.

In the meantime, the Secretary of Commerce and Communications1 conducted his own investigation and found that the aforementioned six streams closed by Roman Santos were natural, floatable and navigable and were utilized by the public for transportation since time

immemorial. He consequently ordered Roman Santos on November 3, 1930 to demolish the dikes across said six streams. However, on May 8, 1931 the said official revoked his decision of November 3, 1930 and declared the streams in question privately owned because they were artificially constructed. Subsequently, upon authority granted under Act 3982 the Secretary of Commerce and Communications entered into a contract with Roman Santos whereby the former recognized the private ownership of Sapang Malauling Maragul, Quiñorang Silab, Pepangebunan, Bulacus, Nigui and Nasi and the latter turned over for public use two artificial canals and bound himself to maintain them in navigable state. The Provincial Board of Pampanga and the municipal councils of Macabebe and Masantol objected to the contract. However, the Secretary of Justice, in his opinion dated March 6, 1934, upheld its legality. Roman Santos withdraw his appeals in the Supreme Court.

With respect to the portion of Hacienda San Esteban still owned by the Zobel family, the municipal authorities of Macabebe filed in 1930 an administrative complaint, in the Bureau of Public Works praying for the opening of the dikes and dams across certain streams in Hacienda San Esteban. Whereupon, the district engineer of Pampanga and a representative of the Bureau of Public Works conducted investigations. In the meantime, the Attorney General, upon a query from the Secretary of Commerce and Communications, rendered an opinion dated October 11, 1930 sustaining the latter's power to declare streams as publicly owned under Sec. 4 of Act 2152, as amended by Act 3208.

On September 29, 1930 the investigator of the Bureau of Public Works, Eliseo Panopio, submitted his report recommending the removal of the dikes and dams in question. And on the basis of said report, the Secretary of Commerce and Communications rendered his decision on November 3, 1930 ordering Ayala y Cia., to demolish the dikes and dams across the streams named therein situated in Hacienda San Esteban. Ayala y Cia., moved for reconsideration, questioning the power of the Secretary of Commerce and Communications to order the demolition of said dikes.

Days before the Secretary of Commerce and Communications rendered his aforementioned decision, Ayala y Cia., thru counsel, made representations with the Director of Public Works for a compromise agreement. In its letter dated October 11, 1930, Ayala y Cia., offered to admit public ownership of the following creeks:

Antipolo, Batasan Teracan, Biuas or Batasan, Capiz, Carbon, Cutut, Dalayap, Enrique, Iba, Inaun, Margarita, Malauli or Budbud, Matalaba Palapat, Palipit Maisao, Panlovenas, Panquitan, Quinapati, Quiñorang, Bubong or Malauli Malati, Salop, Sinubli and Vitas.

provided the rest of the streams were declared private. Acting on said offer, the Director of Public Works instructed the surveyor in his office, Eliseo Panopio, to proceed to Pampanga and conduct another investigation.

On January 23, 1931 Panopio submitted his report to the Director of Public Works recommending that some streams enumerated therein be declared public and some private on the ground that they were originally dug by the hacienda owners. The private streams were:

Agape, Atlong, Cruz, Balanga, Batasan, Batasan Matlaue, Balibago, Baliti, Bato, Buengco Malati, Bungalin, Bungo Malati, Bungo Maragui, Buta-buta, Camastiles, Catlu, Cauayan or Biabas, Cela, Dampalit, Danlimpu, Dilinquente, Fabian, Laguzan, Lalap Maburac, Mabutol, Macabacle, Maragul or Macanduli, Macabacle or Mababo, Maisac, Malande, Malati, Magasawa, Maniup, Manulit, Mapanlao, Maisac, Maragul Mariablus Malate, Masamaral, Mitulid, Nasi, Nigui or Bulacus, Palipit, Maragul, Pangebonan, Paumbong, Pasco or Culali, Pilapil, Pinac Malati, Pinac, Maragul or Macabacle, Quiñorang Silab or

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Malauli Maragul, Raymundo, Salamin, Salop Maisac, Salop Maragul, Sermon and Sinca or Mabulog.

He therefore recommended revocation of the decision already mentioned above, dated November 3, 1930 of the Secretary of Commerce and Communications ordering the demolition of the dikes closing Malauling Maragul, Quiñorang, Silab, Pepangebonan, Nigui, Bulacus, Nasi, and Pinac. On February 13, 1931 the Director of Public Works concurred in Panopio's report and forwarded the same the Secretary of Commerce and Communications.

On February 25, 1935 the municipality of Macabebe and the Zobel family executed an agreement whereby they recognized the nature of the streams mentioned in Panopio's report as public or private, depending on the findings in said report. This agreement was approved by the Secretary of Public Works and Communications on February 27, 1935 and confirmed the next day by the municipal council of Macabebe under Resolution No. 36.

A few months later, that is, on June 12, 1935, the then Secretary of Justice issued an opinion holding that the contract executed by the Zobel family and the municipality of Macabebe has no validity for two reasons, namely, (1) the streams although originally dug by Ayala y Cia., lost their private nature by prescription inasmuch as the public was allowed to use them for navigation and fishing, citing Mercado vs. Municipality of Macabebe, 59 Phil. 592; and (2) at the time the Secretary of Commerce and Communications approved the said contract, he had no more power so to do, because such power under Sec. 2 of Act 2152 was revoked by the amending Act 4175 which took effect on December 7, 1934.

Despite the above ruling of the Secretary of Justice, the streams in question remained closed.

In 1939 administrative investigations were again conducted by various agencies of the Executive branch of our government culminating in an order of President Manuel Quezon immediately before the national elections in 1941 requiring the opening of Sapang Macanduling, Maragul Macabacle, Balbaro and Cansusu. Said streams were again closed in 1942 allegedly upon order of President Quezon.

THE CASE

Roman Santos acquired in 1940 from the Zobel family a larger portion of Hacienda San Esteban wherein are located 25 streams which were closed by Ayala y Cia., and are now the subject matter in the instant controversy.

Eighteen years later, that is in 1958, Congress enacted Republic Act No. 20562 following a congressional inquiry which was kindled by a speech delivered by Senator Rogelio de la Rosa in the Senate. On August 15, 1958 Senator de la Rosa requested in writing the Secretary of Public Works and communications to proceed in pursuance of Republic Act No. 2056 against fishpond owners in the province of Pampanga who have closed rivers and appropriated them as fishponds without color of title. On the same day, Benigno Musni and other residents in the vicinity of Hacienda San Esteban petitioned the Secretary of Public Works and Communications to open the following streams:

Balbaro, Batasan Matua, Bunga, Cansusu, Macabacle, Macanduling, Maragul, Mariablus, Malate, Matalabang, Maisac, Nigui, Quiñorang Silab, Sapang Maragul and Sepung Bato.

Thereupon, the Secretary of Public Works and Communications instructed Julian C. Cargullo to conduct an investigation on the above named streams.

On October 20, 1958 Musni and his co-petitioners amended their petition to include other streams. The amended petition therefore covered the following streams:

Balbaro, Balili, Banawa, Batasan Matua Bato, Bengco, Bunga, Buta-buta, Camastiles, Cansusu, Cela, Don Timpo, Mabalanga, Mabutol, Macabacle, Macabacle qng. Iba, Macanduling, Maragul, Malauli, Magasawa, Mariablus Malate Masamaral, Matalabang Maisa, Mariablus,3 Nigui, Pita, Quiñorang, Silab, Sapang Maragul, Sepung Bato, Sinag and Tumbong.

On March 2, 4, 10, 30 and 31, and April 1, 1959, the Secretary of Public Works and Communications rendered his decisions ordering the opening and restoration of the channel of all the streams in controversy except Sapang Malauling, Maragul, Quiñorang, Silab, Nigui Pepangebonan, Nasi and Bulacus, within 30 days on the ground that said streams belong to the public domain.

On April 29, 1959, that is, after receipt of the Secretary's decision dated March 4, 1959, Roman Santos filed a motion with the Court of First Instance of Man for junction against the Secretary of Public Works and Communications and Julian C. Cargullo. As prayed for preliminary injunction was granted on May 8, 1959. The Secretary of Public Work and Communications answered and alleged as defense that venue was improperly laid; that Roman Santos failed to exhaust administrative remedies; that the contract between Ayala y Cia., and the Municipality of Macabebe is null and void; and, that Section 39 of Act 496 excludes public streams from the operation of the Torrens System.

On April 29 and June 12, 1969, Roman Santos received the decision of the Secretary of Public Works and Communications dated March 10 and March 30, March 31, and April 1, 1959. Consequently, on June 24, 1959 he asked the court to cite in contempt Secretary Florendo Moreno, Undersecretary M.D. Bautista and Julian Cargullo for issuing and serving upon him the said decisions despite the existence of the preliminary injunction. The Solicitor General opposed the motion alleging that the decisions in question had long been issued when the petition for injunction was filed, that they were received after preliminary injunction issued because they were transmitted through the District Engineer of Pampanga to Roman Santos; that their issuance was for Roman Santos' information and guidance; and, that the motion did not allege that respondents took steps to enforce the decision. Acting upon said motion, on July 17, 1959, the trial court considered unsatisfactory the explanation of the Solicitor General but ruled that Secretary Florencio Moreno, Undersecretary M.D. Bautista and Julian Cargullo acted in good faith. Hence, they were merely "admonished to desist from any and further action in this case, observe the preliminary injunction issued by this Court, with the stern warning, however, that a repetition of the acts complained of shall be dealt with severely."

On July 18, 1959 the trial court declared all the streams under litigation private, and rendered the following judgment:

The Writ of preliminary injunction restraining the respondent Secretary of Public Works & Communications from enforcing the decisions of March 2 And 4, 1959 and all other similar decisions is hereby made permanent.

The Secretary of Public Works and Communication and Julian Cargullo appealed to this Court from the order of July 17, 1959 issued in connection with Roman Santos' motion for contempt and from the decision of the lower court on the merits of the case.

ISSUES

The issues are: (1) Did Roman Santos exhaust administrative remedies? (2) Was venue properly laid? (3) Did the lower court err in conducting a trial de novo of the case and in admitting evidence not presented during the administrative proceeding? (4) Do the streams involved in this case belong to the public domain or to the owner of Hacienda San Esteban according to law and the evidence submitted to the Department of Public Works and Communications?

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DISCUSSION OF THE ISSUES

1. Respondents maintain that Roman Santos resorted to the courts without first exhausting administrative remedies available to him, namely, (a) motion for reconsideration of the decisions of the Secretary of Public Works and Communications; and, (b) appeal to the President of the Philippines.

Whether a litigant, in exhausting available administrative remedies, need move for the reconsideration of an administrative decision before he can turn to the courts for relief, would largely depend upon the pertinent law,4 the rules of procedure and the usual practice followed in a particular office.5

Republic Act No. 2056 does not require the filing of a motion for reconsideration as a condition precedent to judicial relief. From the context of the law, the intention of the legislators to forego a motion for reconsideration manifests itself clearly.1awphil.net Republic Act No. 2056 underscores the urgency and summary nature of the proceedings authorized thereunder. Thus in Section 2 thereof the Secretary of Public Works and Communications under pain of criminal liability is duty bound to terminate the proceedings and render his decision within a period not exceeding 90 days from the filing of the complaint. Under the same section, the party respondent concerned is given not than 30 days within which to comply with the decision of the Secretary of Public Works and Communications, otherwise the removal of the dams would be done by the Government at the expense of said party. Congress has precisely provided for a speedy and a most expeditious proceeding for the removal of illegal obstructions to rivers and on the basis of such a provision it would be preposterous to conclude that it had in mind to require a party to file a motion for reconsideration — an additional proceeding which would certainly lengthen the time towards the final settlement of existing controversies. The logical conclusion is that Congress intended the decision of the Secretary of Public Works and Communications to be final and executory subject to a timely review by the courts without going through formal and time consuming preliminaries.

Moreover, the issues raised during the administrative proceedings of this case are the same ones submitted to court for resolution. No new matter was introduced during the proceeding in the court below which the Secretary of Public Works and Communications had no opportunity to correct under his authority.

Furthermore, Roman Santos assailed the constitutionality of Republic Act No. 2056 and the jurisdiction of the Secretary of Public Works and Communications to order the demolition of dams across rivers or streams. Those questions are not within the competence of said Secretary to decide upon a motion for reconsideration.itc-alf They are purely legal questions, not administrative in nature, and should properly be aired before a competent court as was rightly done by petitioner Roman Santos .

At any rate, there is no showing in the records of this case that the Secretary of Public Works and Communications adopted rule of procedure in investigations authorized under Republic Act No. 2056 which require a party litigant to file a motion for the reconsideration of the Secretary's decision before he can appeal to the courts. Roman Santos however stated in his brief that the practice is not to entertain motions for reconsideration for the reason that Republic Act No. 2056 does not expressly or impliedly allow the Secretary to grant the same. Roman Santos' statement is supported by Opinion No. 61, Series of 1959, dated April 14, 1959 of the Secretary of Justice.

As to the failure of Roman Santos to appeal from the decision of the Secretary of Public Works and Communications to the President of the Philippines, suffice it to state that such appeal could be dispensed with because said Secretary is the alter ego of the President.itc-alf The actions of the former are presumed to have the implied sanction of the latter.6

2. It is contended that if this case were considered as an ordinary civil action, venue was improperly laid when the same was instituted in the Court of First Instance of Manila for the reason that the case affects the title of a real property. In fine, the proposition is that since the controversy dwells on the ownership of or title to the streams located in Hacienda San Esteban, the case is real action which, pursuant to Sec. 3 of Rule 5 of the Rules of Court should have been filed in the Court of First Instance of Pampanga.

The mere fact that the resolution of the controversy in this case would wholly rest on the ownership of the streams involved herein would not necessarily classify it as a real action. The purpose of this suit is to review the decision of the Secretary of Public Works and Communications to enjoin him from enforcing them and to prevent him from making and issuing similar decisions concerning the stream in Hacienda San Esteban. The acts of the Secretary of Public Works and Communications are the object of the litigation, that is, petitioner Roman Santos seeks to control them, hence, the suit ought to be filed in the Court of First Instance whose territorial jurisdiction encompasses the place where the respondent Secretary is found or is holding office. For the rule is that outside its territorial limits, the court has no power to enforce its order.7

Section 3 of Rule 5 of the Rules of Court does not apply to determine venue of this action. Applicable is Sec. 1 the same rule, which states:

Sec. 1. General rule. — Civil actions in Courts of First Instance may be commenced and tried where the defendant any of the defendants residents or may be found or where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff.

Accordingly, the Petition for injunction who correctly filed in the Court of First Instance of Manila. Respondents Secretary of Public Works and Communications and Julian Cargullo are found and hold office in the City of Manila.

3. The lower court tried this case de novo. Against this procedure respondents objected and maintained that the action, although captioned as an injunction is really a petition for certiorari to review the decision of the Secretary of Public Works and Communications. Therefore they now contend that the court should have confined itself to reviewing the decisions of the respondent Secretary of Public Works and Communications only on the basis of the evidence presented in the administrative proceedings. On the other hand, Roman Santos now, submits that the action is a proceeding independent and distinct from the administrative investigation; that, accordingly, the lower court correctly acted in trying the case anew and rendering judgment upon evidence adduced during the trial.

Whether the action instituted in the Court of First Instance be for mandamus, injunction or certiorari is not very material. In reviewing the decision of the Secretary of Public Works and Communications, the Court of First Instance shall confine its inquiry to the evidence presented during, the administrative proceedings. Evidence not presented therein shall not be admitted, and considered by the trial court. As aptly by this Court speaking through Mr. Justice J.B.L. Reyes, in a similar case:

The findings of the Secretary can not be enervated by new evidence not laid before him, for that would be tantamount to holding a new investigation, and to substitute for the discretion and judgment of the Secretary the discretion and judgment of the court, to whom the statute had not entrusted the case. It is immaterial that the present action should be one for prohibition or injunction and not one for certiorari; in either event the case must be resolved upon the evidence submitted to the Secretary, since a judicial review of executive decisions does not import a trial de novo, but only an ascertainment of whether the "executive findings are not in violation of the Constitution or of the laws, and are free from fraud or imposition,

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and whether they find reasonable support in the evidence. . . .8

The case at bar, no matter what the parties call it, is in reality a review of several administrative decisions of the Secretary of Public Works and Communications. Being so, it was error for the lower court to conduct a trial de novo. Accordingly, for purposes of this review, only the evidence presented and admitted in the administrative investigation will be considered in our determination of whether on the basis thereof the decisions of the Secretary of Public Works and Communications were correct.

4. We come to the question whether the streams involved in this case belong to the public domain or to the owner of Hacienda San Esteban. If said streams are public, then Republic Act 2056 applies, if private, then the Secretary of Public Works and Communications cannot order demolition of the dikes and dams across them pursuant to his authority granted by said law.

First, we come to the question of the constitutionality of Republic Act No. 2056. The lower court held Republic Act No. 2056 constitutional but ruled that it was applied by respondents unconstitutionally. That is, it held that Roman Santos was being deprived of his property without due process of law, for the dikes of his fishponds were ordered demolished through an administrative, instead of a judicial, proceeding. This conclusion and rationalization of the lower court amount in effect to declaring the law unconstitutional, stated inversely. Note that the law provides for an expeditious administrative process to determine whether or not a dam or dike should be declare a public nuisance and ordered demolished. And to say that such an administrative process, when put to operation, is unconstitutional is tantamount to saying that the law itself violates the Constitution. In Lovina vs. Moreno, supra, We held said law constitutional. We see no reason here to hold otherwise.

Discussing now the applicability of Republic Act 2056, the same applies to two types of bodies of water, namely (1) public navigable rivers, streams, coastal waters, or waterways and (b) areas declared as communal fishing grounds, as provided for in Section 1 thereof:

Sec. 1. . . . the construction or building of dams, dikes or any other works which encroaches into any public navigable river, stream, coastal waters and any other navigable public waters or waterways as well as the construction or building of dams, dikes or any other works in areas declared as communal fishing grounds, shall be ordered removed as public nuisances or as prohibited constructions as herein provided: . . .

We are not concerned with communal fishing grounds because the streams here involved have not been so declared, but with public navigable streams. The question therefore is: Are the streams in Hacienda San Esteban which are mentioned in the petition of Benigno Musni and others, public and navigable?

Respondents contend that said streams are public on the following grounds:

(1) Hacienda San Esteban was formerly a marshland and being so, it is not susceptible to appropriation. It therefore belongs to the State. Respondents rely on Montano vs. Insular Government, 12 Phil. 572.

(2) The streams in question are natural streams. They are tributaries of public streams. Cited are the cases of Samson vs. Dionisio, et al., 11 Phil. 538 and Bautista vs. Alarcon, 23 Phil. 636.

(3) The streams have for their source public rivers, therefore they cannot be classified as canals.

(4) Assuming the streams were artificially made by Ayala y Cia., said titleholder lost ownership over them by prescription

when it allowed the public to use them for navigation for a long time. Respondents cite Mercado vs. Municipal President of Macabebe, 59 Phil. 592.

(5) Assuming the streams in question are not mentioned as public in the certificates of title held by Ayala y Cia., over Hacienda San Esteban, still they cannot be considered as privately owned for Section 39 of Act 496 expressly excepts public streams from private ownership.

(6) The Panopio Report, which found the streams in question of private ownership was nullified by the Secretary of Justice in his opinion dated June 12, 1935.1awphil.net And, the contract between Ayala y Cia., and the Secretary of Commerce and Communications agreeing on the ownership of the streams in question is ultra vires.

The doctrine in Montano vs. Insular Government, supra, that a marshland which is inundated by the rise of the tides belongs to the State and is not susceptible to appropriation by occupation — has no application here inasmuch as in said case the land subject matter of the litigation was not yet titled and precisely Isabelo Montano sought title thereon on the strength of ten years' occupation pursuant to paragraph 6, section 54 of Act 926 of the Philippine Commission. Whereas, the subject matter in this case — Hacienda San Esteban — is titled land and private ownership thereof by Ayala y Cia., has been recognized by the King of Spain and later by the Philippine Government when the same was registered under Act 496.

Respondents further cite Bautista vs. Alarcon, 23 Phil. 631, where the plaintiff sought injunction against the defendants who allegedly constructed a dam across a public canal which conveyed water from the Obando River to fishponds belonging to several persons. The canal was situated within a public land. In sustaining the injunction granted by the Court of First Instance, this Court said:

No private persons has right to usurp possession of a watercourse, branch of a river, or lake of the public domain and use, unless it shall have been proved that he constructed the same within in property of his exclusive ownership, and such usurpation constitutes a violation of the legal provisions which explicity exclude such waterways from the exclusive use or possession of a private party. (Emphasis supplied)

As indicated in the above-cited case, a private person may take possession of a watercourse if he constructed the same within his property.itc-alf This puts Us into inquiry whether the streams in question are natural or artificial. In so doing, We shall examine only the evidence presented before the Department of Public Works and Communications and disregard that which was presented for the first time before the lower court, following our ruling in Lovina vs. Moreno, supra.

(1) Sapang Macanduling Maragul or Macanduli is presently enclosed in Fishpond No. 12 of Roman Santos. Its banks cannot anymore be seen but some traces of them could be noted by a row of isolated nipa palms. Its water is subject to the rise and fall of the tides coming from Guagua and Antipolo Rivers and it is navigable by light watercrafts. Its inlet is Antipolo River; another dike at its outlet along the Palapat River.9 It is closed by four dikes: One dike at its inlet along the Antipolo River; another dike at its cutlet along the Palatpat River; and, two dikes in between. Then exist channel at the Palapat River where the fishpond gate lies has been filled up with dredge spoils from the Pampanga River Control Project.

(2) Sapang Macabacle is found in Fishpond No. 13. Its banks are still evident. This stream is about 30 meters wide, two meters deep and one and one-half to two kilometers long. Its source is Rio Cansusu. Like Macanduli, its channel is obstructed by four dikes. One of them was constructed by the engineers of the Pampanga River Control Project.

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(3) Sapang Balbaro which is found in Fishpond No. 13, runs from Canal Enrique near Rio Cansusu to Sapang Macabacle, a distance of about one-half kilometer. It is passable by banca. The closures of this stream consist of two dikes located at each ends on Canal Enrique and Sapang Macabacle.

(4) Sapang Cansusu is a continuation of the Cansusu River. The Cansusu River opens at the Guagua River and allegedly ends at the Palanas River in front of Barrio San Esteban. At a point near the mouth of Sapang Balbaro, the owners of Hacienda San Esteban built a canal leading straight to one end of Barrio San Esteban. They called this canal "Canal Enrique." And at the point where Canal Enrique joins Cansusu they built a dike across Cansusu, thus closing this very portion of the river which extends up to Palanas River where they built another closure dike. This closed portion, called "Sapang Cansusu," is now part of Fishpond No. 1.

Sapang Cansusu is half a kilometer long and navigable by banca.

Appellant's witnesses, Beligno Musni, 41, Macario Quiambao, 96, Roman Manansala, 55 and Castor Quiambao, 76, all residents of Barrio San Esteban, testified that prior to their closure, Sapang Macaduli, Macabacle, Balbaro and Cansusu were used as passageway and as fishing grounds; that people transported through them tuba,10

wood and sasa,11 and that the tuba was brought to the distillery in Barrio San Esteban. Macario Quiambao testified also that said four streams "were created by God for the town people"; and that if any digging was done it was only to deepen the shallow parts to make passage easier. According to witness Anastacio Quiambao said streams were navigable, even Yangco's ship "Cababayan" could pass through. Simplicio Quiambao, 36, and Marcelino Ocampo, 55, stated on direct examination that before closure of the above named four streams, people from the surrounding towns of Guagua, Bacolor, Macabebe, Masantol and Sexmoan fished and navigated in them.

Against the aforementioned, testimonial evidence Roman Santos presented the testimony of Nicanor Donarber, 80, Mariano Guinto, 71, and his own. Donarber, who started working as an arundin12 testified that Ayala y Cia., dug Sapang Macanduli, Balbaro and Macabacle; that he worked also in the construction together with other workers; and, that as an overseer he inspected their work. Mariano Guinto testified that he worked for Ayala y Cia., as a tuba gatherer; that in order to reach remote nipa groves by banca, they made canals; and, that he was one of the who worked in the construction of those canals. Roman Santos also testified that Sapang Macanduli, Macabacle, Balbaro and Cansusu are artificial canals excavated as far back as 1850 and due to erosion coupled with the spongy nature of the land, they acquired the proportion of rivers; that he joined Sapang Balbaro to Sapang Macabacle because the former was a dying canal; and that Cansusu River is different from Sapang Cansusu Witness Domingo Yumang likewise testified that Sapang Balbaro man-made.

We observe that witnesses positively stated that Sapang Macanduli, Macabacle and Balbaro were made by the owners of Hacienda San Esteban. With respect to Sapang Cansusu none, except Roman Santos himself, testified that Sapang Cansusu is an artificial canal. It is not one of the streams found and recommended to be declared private in the Panopio Report. Sapang Cansusu follows a winding course different and, distinct from that of a canal such as that of Canal Enrique which is straight. Moreover, Sapang Cansusu is a part of Cansusu River, admittedly a public stream.

(5) Sapang Maragul, Mabalanga and Don Timpo are all part of Fishpond No. 1. Maragul is 600 meters long and 30 to 35 meters wide. Mabalanga is 250 meters in length and 50 meters in width. Don Timpo is 220 meters long and 20 meters wide. All of them are navigable by banca. Maragul and Mabalanga open at Guagua River and join each other inside the hacienda to form one single stream, Sapang Don Timpo, which leads to the Matalaba River. Maragul, Mabalanga and Don Timpo, formerly ended inside the

hacienda but later Mabalanga was connected to Don Timpo. Maragul was connected to Mabalanga and Sapang Cela was extended to join Maragul.

Witnesses Nicanor Donarber, Mariano Ocampo and Mariano Guinto testified that Maragul, Mabalanga and Don Timpo are artificial canals dug by Ayala y Cia., and that they (Donarber and Mariano Guinto) worked in said excavations.13 Witness Mariano Guinto clarified that Don Timpo was originally dug but Mabalanga and Maragul were formerly small non-navigable streams which were deepened into artificial navigable canals by Ayala y Cia.14

Exhibit F, which is a map showing the streams and rivers in Hacienda San Esteban, shows that Maragul, Mabalanga and Don Timpo are more or less straight. From the big rivers (Guagua and Matalaba Rivers) they lead deep into the interior of the hacienda, thus confirming the testimony that they were built precisely as a means of reaching the interior of the estate by banca. The weight of evidence, therefore, indicate that said streams are manmade.

(6) Sapang Bunga, now part of Bunga fishpond, gets its water from Sapanga Iba and empties at Sta. Cruz River. It is about 300-400 meters long, 5-6 meters wide and 1-1.60 meters deep.

(7) Sapang Batu is found in Capiz Fishpond. About 300-400 meters long, 4-5 meters wide and 1.50-2.20 meters deep, it starts at Capiz River and ends at Malauling Maragul. From Capiz River until it intersects Sapang Nigui the stream is called Sapang Batu Commencing from Sapang Nigui and up to its end at Sapang Malauling Maragul, the stream is called Sapang Batu. Commencing from Sapang Nigui and up to its end at Sapang Malauling Maragul, the stream is called Sepong Batu. Sepong Batu is not among those streams declared in the Panopio Report as private.

(8) Sapang Banawa has one end at Palanas River and the other at Sapang Macabacle. It is about 300 meters long, 3-4 meters wide and 1.30-1.40 meters deep. Its whole length is within Fishpond No. 13 of Roman Santos.

(9) Sapang Mabutol is a dead-end stream, that is, it ends inside the hacienda. It opens along Guagua river. Since its closure, it has become part of Fishpond No. 1.

(10) Sapang Buta-buta, like Mabutol, dies inside the hacienda. It connects with Cansusu River and is about 100 meters long, 3-4 meters wide and 1.2-1.5 meters deep. It is now a part of Fishpond No. 13.

(11) Sapang Masamaral, another stream which opens at Cansusu River And ends inside the hacienda., is 100-200 meters long, 3-4 meters wide and 1.50-2 meters deep. It now forms part of Fishpond No. 13.

The uncontradicted testimony of Marcos Guinto is that Sapang Bunga, Batu, Sepong Batu, Banawa, Mabutol, Buta-Buta and Masamaral were constructed by Ayala y Cia., to gain access to the nipa the, interior of the hacienda. This testimony tallies with the findings in the Panopio Report which will be discussed herein later. The evidence adduced in the administrative proceeding conducted before a representative of the Secretary of Public Works and Communications supports the contention that said streams are merely canals built by Ayala y Cia., for easy passage into the hinterland of its hacienda.

(12) Sapang Magasawa consists of two streams running parallel to each other commencing from Matalaba River and terminating at Mariablus Rivers. About 600-700 meters long, 4-5 meters wide and 1.5-2 meters deep, these two streams are navigable by banca. They are enclosed within Fishpond No. 1.

(13) Sapang Mariablus Malate, about 3-4 meters wide and 250 meters long, is another stream that ends inside the hacienda and gets its water from Guagua River. It is no part of Fishpond No. 1.

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(14) Sapang Matalabang Malate or Maisac opens at Guagua River and ends at Sapang Cela and Matalabang Maragul. This stream, which is about 800 meters long and 18 meters wide, forms part of Fishpond No. 1 of Roman Santos.

(15) Sapang Batasan Matua about 600 meters long, three meters wide and .80 meters deep at low tide and 1.90 meters deep at high tide crosses the hacienda from Mariablus River to Cansusu River. It is at present a part of Fishpond No. 1-A.

(16) Sapang Camastiles, a dead end stream of about 200 to 300 meters in length, gets its water from Biuas River. It is within Fishpond No. 1.

(17) Sapang Cela is within Fishpond No. 1. Its whole length situated inside the hacienda, it opens at Sapang Matalabang Malate or Maisac and ends at Sapang Malungkot. Latter Cela was extended to connect with Sapang Maragul. It is about 200 meters long and four meters wide.

Mariano Guinto, 71, testified without contradiction that Sapang Mariablus Malate and Matalabang Malate were formerly small and non-navigable streams which were dug by Ayala y Cia.,15 while Batasan Matua Camastiles, Magasawa and Cela are original canals made by Ayala y Cia.,16 that he was one of those who worked in the construction of said canals; and that it took years to construct them. All these streams were recommended in the Panopio Report for declaration as private streams.

(18) Sapang Sinag, 200 meters long, four to five meters wide, one meter and one and one-half meters deep at low and high tides, respectively, gets its water from Cutod River and leads inside the hacienda to connect with Sapang Atlong Cruz, a stream declared private in the Panopio Report. It is now inside Fishpond No. 14.

(19) Sapang Balili, also found inside Fishpond No. 14, is about 200 meters long, three to four meters wide and one meter deep at low tide. From its mouth at Cutod River it drifts into the interior of the hacienda and joins Sapang Bengco.17

(20) Sapang Pita is within Fishpond Capiz. It takes water from Capiz River but dies 250 meters inside the hacienda. It is about four to five meters wide, and one meter deep at low tide and 1.50 meters deep at high tide.

(21) Sapang Tumbong, situated inside Capiz Fishpond, derives its water from Sapang Quiñorang Silab, a stream declared private by the Secretary of Public Works and Communications, and ends inside the hacienda.18

(22) Sapang Bengco is found within Fishpond No. 14.1awphil.net Two hundred meters long, five meters wide, and one meter deep at low tide and 1.50 meters deep at high tide it gets water from Sapang Biabas and connects with Baliling Maisac.19

According to Marcos Guinto, a witness for Roman Santos, Sapang Sinag, Balili, Pita Tumbong and Bengco were excavated a long time ago by Ayala y Cia.; and that they have a winding course because when they were made the workers followed the location of the nipa palms.20 On the other hand, Marcelo Quiambao, testified that Sapang Tumbong is a natural stream and that the reason he said so is because the stream was already there as far back as 1910 when he reached the age of ten. No other oral evidence was presented to contradict the testimony of Marcos Guinto that the said five streams were artificially made by Ayala y Cia.

To show that the streams involved in this case were used exclusively by the hacienda personnel and occasionally by members of their families, Roman Santos introduced the testimony of Eliseo Panopio, Nicanor Donarber, Blas Gaddi, Mariano Ocampo, Mariano Guinto, Alejandro Manansala and himself. The witnesses categorically testified that the public was prohibited from using the streams as a means of navigation and that the prohibition was enforced by guards called arundines.

One and all, the evidence, oral and documentary, presented by Roman Santos in the administrative proceedings supports the conclusion of the lower court that the streams involved in this case were originally man-made canals constructed by the former owners of Hacienda San Esteban and that said streams were not held open for public use. This same conclusion was reached 27 years earlier by an investigator of the Bureau of Public Works whose report and recommendations were approved by the Director of Public Works and submitted to the Secretary of Commerce and Communications.

As stated, pursuant to Act 2152, as amended by Act 3208, the Bureau of Public Works and the Department of Commerce and Communications locked into and settled the question of whether or not the streams situated within Hacienda San Esteban are publicly or privately owned. We refer to the so-called Panopio Report which contains the findings and recommendations of Eliseo Panopio, a surveyor in the Bureau of Public Works, who was designated to conduct formal hearings and investigation. Said report found the following streams, among others, of private ownership:

Camastiles, Cela Balanga, Bato, Batasan, Bengco, Buta-buta, Don Timpo, Mabutol, Macabacle, Macanduli, Malande Malate (Bunga), Magasawa, Masamaral, Maragul, Mariablus Malate, Matalaba Malate, Nasi, Nigui, Pangebonan and Quiñorang Silab

on the ground that —

The preponderance of the probatory facts, . . ., shows that the rivers, creeks, esteros and canals listed in (1) have originally been constructed, deepened, widened, and lengthened by the owners of the Hacienda San Esteban. That they have been used as means of communication from one place to another and to the inner most of the nipales, exclusively for the employees, colonos and laborers of the said Hacienda San Esteban. That they have never been used by the public for navigation without the express consent of the owners of the said Hacienda.21

Bases for the above-quoted conclusion were "the reliable informations gathered from old residents of the locality, from outsiders, the sworn statements obtained from different persons not interested in this case and the comparison of the three plans prepared in 1880, 1906 and 1930.22 The persons referred to are Martin Isip, Hilarion Lobo, Emigdio Ignacio, Castor Quiambao, Matias Sunga facio Cruz, Inocencio Dayrit, Gabriel Manansala, Lope Quiambao, Marcelino Bustos and Juan Lara .

On February 13, 1931 the Director of Public Works transmitted the Panopio Report to the Secretary of Commerce and Communications recommending approval thereof. Later, on February 27, 1935, Secretary of Public Works and Communications De las Alas approved the agreement of Ayala y Cia., and the Municipality of Macabebe, concerning the ownership of the streams in Hacienda San Esteban, for being in conformity with said Panopio Report.

This agreement of Ayala y Cia and the Municipality of Macabebe which was approved by the Secretary of Public Works and Communications only on February 27, 1935, could not however bind the Government because the power of the Secretary of Public Works and Communication to enter thereto had been suppressed by the Philppine Legislature when it enacted Act 4175 which effect on December 7, 1934.

Nullity of the aforesaid contract would not of course affect the findings of fact contained in the Panopio Report.

In weighing the evidence presented before the administrative investigation which culminated in this appeal, respondent Secretary seemed to have ignored the Panopio Report and other documentary evidence as well as the testimony of

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witnesses presented by petitioner but instead gave credence only to the witnesses of Benigno Musni, et al. Upon review, however, the lower court, taking into account all the evidence adduced in the administrative hearing, including the Panopio Report, as well as those presented for the first time before it, sustained petitioner's averment that the streams in question were artificially made, hence of private ownership. As stated, this conclusion of the lower court which is in accord with the findings of Panopio as contained in his report, finds ample support from the evidence presented and admitted in the administrative investigation. Accordingly, we see no merit in disturbing the lower court's findings fact.

We next consider the issue of whether under pertinent laws, the streams in question are public or private.

We quote Articles 339, 407 and 408 of the Spanish Civil Code of 1889:

Art. 339. Property of public ownerships is —

1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State, river banks, shores, roadsteads, and that of a similar character;

Art. 407. The following are of public ownership:

1. Rivers and their natural channels;

2. Continuous or intermittent waters from springs or brooks running in their natural channels and the channels themselves.

3. Waters rising continuously or intermittently on lands of public ownership;

4. Lakes and ponds formed by nature, on public lands, and their beds;

5. Rain waters running through ravines or sand beds, the channels of which are of public ownership;

6. Subterranean waters on public lands;

7. Waters found within the zone of operation of public works, even though constructed under contract;

8. Waters which flow continuously or intermittently from lands belonging to private persons, to the State, to provinces, or to towns, from the moment they leave such lands;

9. The waste waters of fountains, sewers, and public institutions.

Art. 408. The following are of private ownership:

1. Waters, either continuous or intermittent rising on private etates, while they run through them;

2. Lakes and ponds and their beds when formed by nature on such estates;

3. Subterranean waters found therein;

4. Rain water falling thereon as long as their bounderies.

5. The channels of flowing streams, continuous or intermittent, formed by rain water, and those of

brooks crossing estates which are not of public ownership.

The water, bed, banks, and floodgates of a ditch or aqueduct are deemed to be an integral part of the estate or building for which the waters are intended. The owners of estates through or along the boundaries of which the aqueduct passes can assert no ownership over it, nor any right to make use. of it beds or banks, unless they base their claims on title deed which specify the right or the ownership claimed.

Articles 71 and 72 of the Spanish Law of Waters of August 3, 1866 state:

Art. 71. The water-beds of all creeks belong to the owners of the estates or lands over which they flow.

Art. 72. The water-beds on public land, of creeks through which spring waters run, are a part of the public domain.

The natural water-beds or channels of rivers are also part of the public domain.

Pursuant to Article 71 of the Spanish Law of Waters of August 3, 1866, and Article 408(5) of the Spanish Civil Code, channels of creeks and brooks belong to the owners of estates over which they flow. The channels, therefore, of the streams in question which may be classified creeks, belong to the owners of Hacienda San Esteban.

The said streams, considered as canals, of which they originally were, are of private ownership in contemplation of Article 339(l) of the Spanish Civil Code. Under Article 339, canals constructed by the State and devoted to public use are of public ownership. Conversely, canals constructed by private persons within private lands and devoted exclusively for private use must be of private ownership.

Our attention has been called to the case of Mercado v. Municipal President of Macabebe, 59 Phil. 592. There the creek (Batasan-Limasan) involved was originally dug by the estate's owner who, subsequently allowed said creek to be used by the public for navigation and fishing purposes for a period of 22 years. Said this Court through Mr. Justice Diaz:

And even granting that the Batasan-Limasan creek acquired the proportions which it had, before it was closed, as a result of excavations made by laborers of the appellant's predecesor in interest, it being a fact that, since the time it was opened as a water route between the Nasi River and Limasan creek, the owners thereof as well as strangers, that is, both the residents of the hacienda and those of other nearby barrios and municipalities, had been using it not only for their bancas to pass through but also for fishing purposes, and it being also a fact that such was the condition of the creek at least since 1906 until it was closed in 1928, if the appellant and her predecessors in interest had acquired any right to the creek in question by virtue of excavations which they had made thereon, they had such right through prescription, inasmuch as they failed to obtain, and in fact they have not obtained, the necessary authorization to devote it to their own use to the exclusion of all others. The use and enjoyment of a creek, as any other property simceptible of appropriation, may be acquired or lost through prescription, and the appellant and her predecessors in interest certainly lost such right through the said cause, and they cannot now claim it exclusively for themselves after the general public had been openly using the same from 1906 to 1928. . . .

In the cited case, the creek could have been of private ownership had not its builder lost it by prescription. Applying

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the principle therein enunciated to the case at bar, the conclusion would be inevitably in favor of private ownership, considering that the owners of Hacienda San Esteban held them for their exclusive use and prohibited the public from using them.

It may be noted that in the opinion, mentioned earlier, issued on June 12, 1935, the Secretary of Justice answered in the negative the query of the Secretary of Public Works and Communications whether the latter can declare of private ownership those streams which "were dug up artificially", because it was assumed that the streams were used "by the public as fishing ground and in transporting their commerce in bancas or in small crafts without the objection of the parties who dug" them. Precisely, Mercado v. Municipality of Macabebe was given application therein. However, the facts, as then found by the Bureau of Public Works, do not support the factual premise that the streams in question were used by the public "without the objection of the parties who dug" them. We cannot therefore take as controlling in determining the merits of this the factual premises and the legal conclusion contained in said opinion.

The case at bar should be differentiated from those cases where We held illegal the closing and/or appropriation of rivers or streams by owners of estates through which they flow for purposes of converting them into fishponds or other works.23 In those cases, the watercourses which were dammed were natural navigable streams and used habitually by the public for a long time as a means of navigation. Consequently, they belong to the public domain either as rivers pursuant to Article 407 (1) of the Spanish Civil Code of 1889 or as property devoted to public use under Article 339 of the same code. Whereas, the streams involved in this case were artificially made and devoted to the exclusive use of the hacienda owner.

Finally, Sapang Cansusu, being a natural stream and a continuation of the Cansusu River, admittedly a public stream, belongs to the public domain. Its closure therefore by the predecessors of Roman Santos was illegal.

The petition for the opening of Sapang Malauling Maragul, Quiñorang Silab, Nigui, Pepangebunan, Nasi and Bulacus was dismissed by the Secretary of Public Works and Communications and the case considered closed. The said administrative decision has not been questioned in this appeal by either party. Hence, they are deemed excluded herein.

All the other streams, being artificial and devoted exclusively for the use of the hacienda owner and his personnel, are declared of private ownership. Hence, the dams across them should not he ordered demolished as public nuisances.

With respect to the issue of contempt of court on the part of the Secretary of Public Works and Communications and Julian Cargullo for the alleged issuance of a administrative decisions ordering demolition of dikes involved in this case after the writ of injunction was granted and served, suffice it to state that the lower court made no finding of contempt of court. Necessarily, there is no conviction for contempt reviewable by this Court and any discussion on the matter would be academic.

WHEREFORE, the decision appealed from is affirmed, except as to Sapang Cansusu which is hereby declared public and as to which the judgment of the lower court is reversed. No costs. So ordered.

G.R. No. L-31271 April 29, 1974

ROMEO MARTINEZ and LEONOR SUAREZ, spouses, petitioners-appellants, vs.HON. COURT OF APPEALS, SECRETARY and UNDERSECRETARY OF PUBLIC WORKS & COMMUNICATIONS, respondents-appellees.

Flores Macapagal, Ocampo and Balbastro for petitioners-appellants.

Office of the Solicitor General Felix Q. Antonio, Acting Assistant Solicitor General Dominador L. Quiroz and Solicitor Concepcion T. Agapinan for respondents-appellees.

 

ESGUERRA, J.:p

Petition for review by certiorari of the judgment of the Court of Appeals dated November 17, 1969 in its CA-G.R. 27655-R which reverses the judgment of the Court of First Instance of Pampanga in favor of petitioners-appellants against the Secretary and Undersecretary of Public Works & Communications in the case instituted to annul the order of November 25, 1958 of respondent Secretary of Public Works & Communications directing the removal by the petitioners of the dikes they had constructed on Lot No. 15856 of the Register of Deeds of Pampanga, which order was issued pursuant to the provisions of Republic Act No. 2056. The dispositive portion of the judgment of reversal of the Court of Appeals reads as follows:

IN VIEW OF THE FOREGOING CONSIDERATIONS, the judgment appealed from is hereby reversed, and another entered: [1] upholding the validity of the decision reached by the respondent officials in the administrative case; [2] dissolving the injunction issued by the Court below; and [3] cancelling the registration of Lot No. 2, the disputed area, and ordering its reconveyance to the public domain. No costs in this instance.

The background facts are stated by the Court of Appeals as follows:

The spouses Romeo Martinez and Leonor Suarez, now petitioners-appellees, are the registered owners of two (2) parcels of land located in Lubao, Pampanga, covered by transfer certificate of title No. 15856 of the Register of Deeds of the said province. Both parcels of land are fishponds. The property involved in the instant case is the second parcel mentioned in the above-named transfer certificate of title.

The disputed property was originally owned by one Paulino Montemayor, who secured a "titulo real" over it way back in 1883. After the death of Paulino Montemayor the said property passed to his successors-in-interest, Maria Montemayor and Donata Montemayor, who in turn, sold it, as well as the first parcel, to a certain Potenciano Garcia.

Because Potenciano Garcia was prevented by the then municipal president of Lubao, Pedro Beltran, from restoring the dikes constructed on the contested property, the former, on June 22, 1914, filed Civil Case No. 1407 with the Court of First Instance against the said Pedro Beltran to restrain the latter in his official capacity from molesting him in the possession of said second parcel, and on even date, applied for a writ of preliminary injunction, which was issued against said municipal president. The Court, by decision promulgated June 12, 1916, declared permanent the preliminary injunction, which, decision, on appeal, was affirmed by the Supreme Court on August 21, 1918. From June

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22, 1914, the dikes around the property in question remained closed until a portion thereof was again opened just before the outbreak of the Pacific War.

On April 17, 1925. Potenciano Garcia applied for the registration of both parcels of land in his name, and the Court of First Instance of Pampanga, sitting as land registration court, granted the registration over and against the opposition of the Attorney-General and the Director of Forestry. Pursuant to the Court's decision, original certificate of title No. 14318, covering said parcels 1 and 2 was issued to the spouses Potenciano Garcia and Lorenza Sioson.

These parcels of land were subsequently bought by Emilio Cruz de Dios in whose name transfer certificate of title No. 1421 was first issued on November 9, 1925.

Thereafter, the ownership of these properties changed hands until eventually they were acquired by the herein appellee spouses who hold them by virtue of transfer certificate of title No. 15856.

To avoid any untoward incident, the disputants agreed to refer the matter to the Committee on Rivers and Streams, by then composed of the Honorable Pedro Tuason, at that time Secretary of Justice, as chairman, and the Honorable Salvador Araneta and Vicente Orosa, Secretary of Agriculture and National Resources and Secretary of Public Works and Communications, respectively, as members. This committee thereafter appointed a Sub-Committee to investigate the case and to conduct an ocular inspection of the contested property, and on March 11, 1954, said Sub-Committee submitted its report to the Committee on Rivers and Streams to the effect that Parcel No. 2 of transfer certificate of title No. 15856 was not a public river but a private fishpond owned by the herein spouses.

On July 7, 1954, the Committee on Rivers and Streams rendered its decision the dispositive part of which reads:

"In view of the foregoing considerations, the spouses Romeo Martinez and Leonor Suarez should be restored to the exclusive possession, use and enjoyment of the creek in question which forms part of their registered property and the decision of the courts on the matter be given full force and effect."

The municipal officials of Lubao, led by Acting Mayor Mariano Zagad, apparently refused to recognize the above decision, because on September 1, 1954, the spouses Romeo Martinez and Leonor Suarez instituted Civil Case No. 751 before the Court of First Instance of Pampanga against said Mayor Zagad, praying that the latter be enjoined from molesting them in their possession of their property and in the construction of the dikes therein. The writ of preliminary injunction applied for was issued against the respondent municipal Mayor, who immediately elevated the injunction suit for review to the Supreme Court, which dismissed Mayor Zagad's petition on September 7, 1953. With this dismissal order herein appellee spouses proceeded to construct the dikes in the disputed parcel of land.

Some four (4) years later, and while Civil Case No. 751 was still pending the Honorable Florencio Moreno, then Secretary of Public Works and Communications, ordered another investigation of the said parcel of land, directing the appellees herein to remove the dikes they had constructed, on the strength of the authority vested in him by Republic Act No. 2056, approved on June 13, 1958, entitled "An Act To Prohibit, Remove and/or Demolish the Construction of Dams. Dikes, Or Any Other Walls In Public Navigable Waters, Or Waterways and In Communal Fishing Grounds, To Regulate Works in Such Waters or Waterways And In Communal Fishing Grounds, And To Provide Penalties For Its Violation, And For Other Purposes. 1 The said order which gave rise to the instant proceedings, embodied a threat that the dikes would be demolished should the herein appellees fail to comply therewith within thirty (30) days.

The spouses Martinez replied to the order by commencing on January 2, 1959 the present case, which was decided in their favor by the lower Court in a decision dated August 10, 1959, the dispositive part of which reads:

"WHEREFORE, in view of the foregoing considerations, the Court hereby declares the decision, Exhibit S, rendered by the Undersecretary of Public Works and Communications null and void; declares the preliminary injunction, hereto for issued, permanent, and forever enjoining both respondents from molesting the spouses Romeo Martinez and Leonor Suarez in their possession, use and enjoyment of their property described in Plan Psu-9992 and referred to in their petition."

"Without pronouncement as to costs."

"SO ORDERED."

As against this judgment respondent officials of the Department of Public Works and Communications took the instant appeal, contending that the lower Court erred:

1. In holding that then Senator Rogelio de la Rosa, complainant in the administrative case, is not an interested party and his letter-complaint dated August 15, 1958 did not confer jurisdiction upon the respondent Undersecretary of Public Works and Communications to investigate the said administrative case;

2. In holding that the duty to investigate encroachments upon public rivers conferred upon the respondent Secretary under Republic Act No. 7056 cannot be lawfully delegated by him to his subordinates;

3. In holding that the investigation ordered by the respondent Secretary in this case is illegal on the ground that the said respondent Secretary has arrogated unto himself the power, which he does not possess, of reversing, making nugatory, and setting aside the two lawful decisions of the Court Exhibits K and I, and even annulling thereby, the one rendered by the highest Tribunal of the land;

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4. In not sustaining respondent's claim that petitioners have no cause of action because the property in dispute is a public river and in holding that the said claim has no basis in fact and in law;

5. In not passing upon and disposing of respondent's counterclaim;

6. In not sustaining respondent's claim that the petition should not have been entertained on the ground that the petitioners have not exhausted administrative remedies; and

7. In holding that the decision of the respondents is illegal on the ground that it violates the principles that laws shall have no retroactive effect unless the contrary is provided and in holding that the said Republic Act No. 2056 is unconstitutional on the ground that respondents' threat of prosecuting petitioners under Section 3 thereof for acts done four years before its enactment renders the said law ex post facto.

The Court of Appeals sustained the above-mentioned assignment of errors committed by the Court of First Instance of Pampanga and, as previously stated, reversed the judgment of the latter court. From this reversal this appeal by certiorari was taken, and before this Court, petitioners-appellants assigned the following errors allegedly committed by the Court of Appeals:

1. THE COURT OF APPEALS ERRED IN DECLARING IN THE INSTANT CASE THAT PARCEL NO. 2 OF TRANSFER CERTIFICATE OF TITLE NO. 15856 IS A PUBLIC RIVER AND ORDERING THE CANCELLATION OF ITS REGISTRATION BECAUSE THIS CONSTITUTES A COLLATERAL ATTACK ON A TORRENS TITLE IN VIOLATION OF THE LAW AND THE WELL-SETTLED JURISPRUDENCE ON THE MATTER.

2. THE COURT OF APPEALS ERRED IN REOPENING AND RE-LITIGATING THE ISSUE AS TO WHETHER OR NOT LOT NO. 2 OF TRANSFER CERTIFICATE OF TITLE NO. 15856 REGISTER OF DEEDS OF PAMPANGA, IS A PUBLIC RIVER NOTWITHSTANDING THE FACT THAT THIS ISSUE HAS BEEN LONG RESOLVED AND SETTLED BY THE LAND REGISTRATION COURT OF PAMPANGA IN LAND REGISTRATION PROCEEDING NO. 692 AND IS NOW RES JUDICATA.

3. THE COURT OF APPEALS ERRED IN ORDERING THE CANCELLATION OF THE REGISTRATION OF LOT NO. 2 OF TRANSFER CERTIFICATE OF TITLE NO. 15856 NOTWITHSTANDING THE FACT THAT THE TORRENS TITLE COVERING IT HAS BEEN VESTED IN THE PETITIONERS WHO ARE THE SEVENTH OF THE SUCCESSIVE INNOCENT PURCHASERS THEREOF AND WHO IN PURCHASING THE SAME RELIED ON THE PRINCIPLE THAT THE PERSONS DEALING WITH REGISTERED LAND NEED NOT GO BEHIND THE REGISTER TO DETERMINE THE CONDITION OF THE PROPERTY.

The 1st and 2nd assignment of errors, being closely related, will be taken up together.

The ruling of the Court of Appeals that Lot No. 2 covered by Transfer Certificate of Title No. 15856 of the petitioners-appellants is a public stream and that said title should be cancelled and the river covered reverted to public domain, is assailed by the petitioners-appellants as being a collateral attack on the indefeasibility of the torrens title originally issued in 1925 in favor of the petitioners-appellants' predecessor-in-interest, Potenciano Garcia, which is violative of the rule of res judicata. It is argued that as the decree of registration issued by the Land Registration Court was not re-opened through a petition for review filed within one (1) year from the entry of the decree of title, the certificate of title issued pursuant thereto in favor of the appellants for the land covered thereby is no longer open to attack under Section 38 of the Land Registration Act (Act 496) and the jurisprudence on the matter established by this Tribunal. Section 38 of the Land Registration Act cited by appellants expressly makes a decree of registration, which ordinarily makes the title absolute and indefeasible, subject to the exemption stated in Section 39 of the said Act among which are: "liens, claims or rights arising or existing under the laws or Constitution of the United States or of the Philippine Islands which the statute of the Philippine Islands cannot require to appear of record in the registry."

At the time of the enactment of Section 496, one right recognized or existing under the law is that provided for in Article 339 of the old Civil Code which reads as follows:

Property of public ownership is:

1. That destined to the public use, such as roads, canals, rivers, torrents, ports, and bridges constructed by the State, and banks shores, roadsteads, and that of a similar character. (Par. 1)

The above-mentioned properties are parts of the public domain intended for public use, are outside the commerce of men and, therefore, not subject to private appropriation. ( 3 Manresa, 6th ed. 101-104.)

In Ledesma v. Municipality of Iloilo, 49 Phil. 769, this Court held:

A simple possession of a certificate of title under the Torrens system does not necessarily make the possessor a true owner of all the property described therein. If a person obtains title under the Torrens system which includes by mistake or oversight, lands which cannot be registered under the Torrens system, he does not by virtue of said certificate alone become the owner of the land illegally included.

In Mercado v. Municipal President of Macabebe, 59 Phil. 592, it was also said:

It is useless for the appellant now to allege that she has obtained certificate of title No. 329 in her favor because the said certificate does not confer upon her any right to the creek in question, inasmuch as the said creek, being of the public domain, is included among the various exceptions enumerated in Section 39 of Act 496 to which the said certificate is subject by express provision of the law.

The same ruling was laid down in Director of Lands v. Roman Catholic Bishop of Zamboanga, 61 Phil. 644, as regards public plaza.

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In Dizon, et al. v. Rodriguez, et al., G.R. No. L-20300-01 and G.R. No. L-20355-56, April 30, 1965, 20 SCRA 704, it was held that the incontestable and indefeasible character of a Torrens certificate of title does not operate when the land covered thereby is not capable of registration.

It is, therefore, clear that the authorities cited by the appellants as to the conclusiveness and incontestability of a Torrens certificate of title do not apply here. The Land Registration Court has no jurisdiction over non-registerable properties, such as public navigable rivers which are parts of the public domain, and cannot validly adjudge the registration of title in favor of a private applicant. Hence, the judgment of the Court of First Instance of Pampanga as regards the Lot No. 2 of Certificate of Title No. 15856 in the name of petitioners-appellants may be attacked at any time, either directly or collaterally, by the State which is not bound by any prescriptive period provided for by the Statute of Limitations (Article 1108, par. 4, new Civil Code). The right of reversion or reconveyance to the State of the public properties fraudulently registered and which are not capable of private appropriation or private acquisition does not prescribe. (Republic v. Ramona Ruiz, et al., G.R. No. L-23712, April 29, 1968, 23 SCRA 348; Republic v. Ramos, G.R. No. L-15484, January 31, 1963, 7 SCRA 47.)

When it comes to registered properties, the jurisdiction of the Secretary of Public Works & Communications under Republic Act 2056 to order the removal or obstruction to navigation along a public and navigable creek or river included therein, has been definitely settled and is no longer open to question (Lovina v. Moreno, G.R. No L-17821, November 29, 1963, 9 SCRA 557; Taleon v. Secretary of Public Works & Communications G.R. No. L-24281, May 16, 1961, 20 SCRA 69, 74).

The evidence submitted before the trial court which was passed upon by the respondent Court of Appeals shows that Lot No. 2 (Plan Psu 992) of Transfer Certificate of Title No. 15856, is a river of the public domain. The technical description of both Lots Nos. 1 and 2 appearing in Original Certificate of Title No. 14318 of the Register of Deeds of Pampanga, from which the present Transfer Certificate of Title No. 15856 was derived, confirms the fact that Lot No. 2 embraced in said title is bounded practically on all sides by rivers. As held by the Court of First Instance of Pampanga in Civil Case No. 1247 for injunction filed by the petitioners' predecessors-in-interest against the Municipal Mayor of Lubao and decided in 1916 (Exh. "L"), Lot No. 2 is a branch of the main river that has been covered with water since time immemorial and, therefore, part of the public domain. This finding having been affirmed by the Supreme Court, there is no longer any doubt that Lot No. 2 of Transfer Certificate of Title No. 15856 of petitioners is a river which is not capable of private appropriation or acquisition by prescription. (Palanca v. Com. of the Philippines, 69 Phil. 449; Meneses v. Com. of the Philippines, 69 Phil. 647). Consequently, appellants' title does not include said river.

II

As regards the 3rd assignment of error, there is no weight in the appellants' argument that, being a purchaser for value and in good faith of Lot No. 2, the nullification of its registration would be contrary to the law and to the applicable decisions of the Supreme Court as it would destroy the stability of the title which is the core of the system of registration. Appellants cannot be deemed purchasers for value and in good faith as in the deed of absolute conveyance executed in their favor, the following appears:

6. Que la segunda parcela arriba descrita y mencionada esta actualmente abierta, sin malecones y excluida de la primera parcela en virtud de la Orden Administrative No. 103, tal como fue enmendada, del pasado regimen o Gobierno.

7. Que los citados compradores Romeo Martinez y Leonor Suarez se encargan de gestionar de las autoridades correspondientes para que la citada segunda parcela pueda ser convertida de nuevo en pesqueria, corriendo a cuenta y cargo de los mismos todos los gastos.

8. Que en el caso de que dichos compradores no pudiesen conseguir sus propositos de convertir de nuevo en pesquera la citada segunda parcela, los aqui vendedores no devolveran ninguna cantidad de dinero a los referidos compradores; este es, no se disminuiriat el precio de esta venta. (Exh. 13-a, p. 52, respondents record of exhibits)

These stipulations were accepted by the petitioners-appellants in the same conveyance in the following terms:

Romeo Martinez y Leonor Suarez, mayores de edad, filipinos y residentes en al Barrio de Julo Municipio de Malabon, Provincia de Rizal, por la presente, declaran que estan enterados del contenido de este documento y lo aceptan en los precisos terminos en que arriba uedan consignados. (Exh. 13-a, ibid)

Before purchasing a parcel of land, it cannot be contended that the appellants who were the vendees did not know exactly the condition of the land that they were buying and the obstacles or restrictions thereon that may be put up by the government in connection with their project of converting Lot No. 2 in question into a fishpond. Nevertheless, they willfully and voluntarily assumed the risks attendant to the sale of said lot. One who buys something with knowledge of defect or lack of title in his vendor cannot claim that he acquired it in good faith (Leung Lee v. Strong Machinery Co., et al., 37 Phil. 664).

The ruling that a purchaser of a registered property cannot go beyond the record to make inquiries as to the legality of the title of the registered owner, but may rely on the registry to determine if there is no lien or encumbrances over the same, cannot be availed of as against the law and the accepted principle that rivers are parts of the public domain for public use and not capable of private appropriation or acquisition by prescription.

FOR ALL THE FOREGOING, the judgment of the Court of Appeals appealed from is in accordance with law, and the same is hereby affirmed with costs against the petitioners-appellants.

G.R. No. L-3279             March 11, 1908

THE CITY OF MANILA, petitioner-appellee, vs.THE INSULAR GOVERNMENT, ET AL., respondents-appellants.

Attorney-General Araneta for the Government.Modesto Reyes for appellee.

JOHNSON, J.:

On the 11th day of November, 1904, the city of Manila, through its attorney, filed a petition in the Court of Land Registration for the registration of a certain parcel or tract of land described by metes and bounds in the first paragraph of said petition as follows:

A parcel of land situated in Paco, a district of this city. It is bounded on the north by properties belonging to Chas. M. Stone, Prudencio de Leon,

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Asuncion Ventura, Petra Carnero y Garcia, Evaristo Roxas and brothers, Silvestra Sarmiento, Evaristo Gonzalez y Valdes, Mariano Vergara, Bernardo Yalon, Julio Gonzaga, Leoncia Mañalac, Geronimo Morales, Antonio Bautista, Doroteo Palacio, and Gualberta de los Reyes; on the south and on the east by property owned by Miguel Fabie and brothers, and on the west by properties belonging to Gualberta de los Reyes and Toribia Cruz. Beginning at the intersection of the northern line of Calle Real and the eastern line of Calle Peñafrancia (new street lines), approved on 21st December, 1903, and 17th February, 1904, respectively, by the Municipal Board, thence S. 4 degrees and 8 minutes E., 157.09 meters to the point marked "0;) thence N., 79 degrees 37 minutes W., 1830 meters along the southern boundary of the property owned by Evaristo Gonzalez Valdes and Mariano Vergara to point No. 1; thence N. 11 degrees 25 minutes E., 6.20 meters along the western boundary of the property belonging to Mariano Vergara to point No. 2; thence N. 86 degrees 38 minutes W., 29.60 meters along the southern boundary of the property owned by Mariano Vergara to point No. 3; thence N. 4 degrees 14 minutes E., 22.49 meters along the western boundary of the property of Mariano Vergara, to point No. 4; thence No. 11 degrees 42 minutes W., 5.71 meters along the western boundary of the property belonging to Bernardo Yalon to point No. 5; thence s. 89 degrees 50 minutes W., 78.00 meters to a stone monument along the southern boundary of the property owned by Julio Gonzaga, Leoncia Mañalac, Geronimo Morales, to point No. 6; thence N. 89 degrees 22 minutes W., 24.17 meters along the southern boundary of the property belonging to Antonio Bautista, to point No. 7; thence S. 55 degrees 56 minutes W., 16.81 meters along the southeastern boundary of the property owned by Doroteo Palacio to point No. 8; thence N. 86 degrees 49 minutes W., 25.50 meters along the southern boundary of the properties owned by Doroteo Palacio and Gualberta de los Reyes to point No. 9; thence S. 15 degrees 30 minutes W., 16.47 meters to a stone monument, along the eastern boundary of the property owned by Gualberta de los Reyes and Toribia Cruz to point No. 10; thence S. 7 degrees 35 minutes W., 14.16 meters along the eastern boundary of the property owned by Toribia Cruz to point No. 11; thence S. 75 degrees 39 minutes E., 14.37 meters along the northern boundary of the property of Miguel Fabie and brothers to point No. 12; thence N. 88 degrees 3 minutes E., 45.35 meters along the northern boundary of the property belonging to Miguel Fabie and brothers to point No. 13; thence S. 89 degrees 11 minutes E., 70.15 meters to a stone monument to Miguel Fabie and brothers to point No. 14; thence S. 86 degrees 33 minutes E., 85.07 meters to a stone monument along the northern boundary of the property of Miguel Fabie and brothers to point No. 15; thence N. 83 degrees 8 minutes E., 14.49 meters along the northern boundary of the property owned by Miguel Fabie and brothers to point no. 16; thence N. 47 degrees E., 158.35 meters along the northwestern boundary of Miguel Fabie and brothers to point No. 17; thence N. 70 degrees 22 minutes W., 40.74 meters along the southern boundary of the properties owned by Charles M. Stone, Prudencio de Leon, and Asuncion Ventura (Looban) to point No. 18; thence N. 83 degrees 22 minutes W., 7.38 meters along a stone fence and the southern boundary of the properties belonging to Asuncion Ventura (Looban) and Petra Garcia to point No. 19; thence S. 30 degrees 34 minutes W., 21.12 meters along a stone fence and the western boundary of the property owned by Petra Carnero y Garcia to point No. 20; thence S. 74 degrees 58 minutes W., 8.70 meters along the northern boundary of the property of Evaristo Roxas and brothers to point No. 21; thence s. 22 degrees 4 minutes W., 34.75 meters along the eastern boundary of the property owned by Evaristo Roxas

and brothers to point 22; thence N. 68 degrees 47 minutes W., 26.40 meters along the southern boundary of the property belonging to Evaristo Roxas and brothers to point No. 23; thence S. 68 degrees 47 minutes W., 85.61 meters along the eastern boundary of the properties owned by Silvestra Sarmiento and Evaristo Gonzalez y Valdes to point No. 24; thence N. 84 degrees 58 minutes W., 12.85 meters to a stone monument along the southern boundary of the property owned by Evaristo Gonzalez Valdes to point No. 25; thence N. 79 degrees 37 minutes W., 11.10 meters along the southern boundary of the property owned by Evaristo Gonzalez Valdes to point No. 0, the point of the beginning. Containing 10,472.23 square meters of extension. Bearings magnetic.

The said city alleged that it was the absolute owner of the said land; that said land was assessed by the city of Manila in the sum of $1,780, United States currency; that there existed no liens of whatever character against said land; that the land was unoccupied; that the said city obtained title to the said land by reason of being the successor to all the rights and actions of the old city of Manila (ayuntamiento de Manila), to which said property formerly belonged.

To this petition of the petitioner, the Insular Government presented the following opposition to the registration of said land:

The Solicitor-General, representing the Insular Government, appears before the court, and states:

I. That the city of Manila, represented by its attorney, Modesto Reyes, requests that, in compliance with the Land Registration Act, a parcel of land situated in Paco, a district of this city, of which it claims to be the absolute owner, and the description of which is specified in the petition be inscribed in its name.

II. That the land in question is the property of the Government of the United States under the control of the Insular Government.

III. That by virtue thereof, the Solicitor-General opposes the inscription asked for, and requests the court to deny the petition with the costs.

To this petition of the petitioner one Geronimo Morales also presented the following opposition to the registration of a portion of the land described in the second paragraph of said petition:

Now comes the undersigned before this court and says:

1. That the city of Manila, by its attorney, Modesto Reyes, has, in conformity with the provisions of the Land Registration Act, applied for the registration of a certain parcel of land located in the district of Paco, of this city, of which it alleges sole and absolute ownership, and the description of which is included in the application.

2. That the plan and description of the said land as they appear in the petition are incorrect, for there is included in the same a part of a building lot belonging to the undersigned, and situated in the barrio of Rosario of said district, with an area of 84 meters more or less, as will be seen in the plan to be filed later.

3. Therefore, the undersigned files his opposition to the registration applied for, as far as it has any bearing on the building lot of the undersigned which is included in the plan and description of the applicant, and this honorable court is requested to

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deny the application as far as it relates to the said building lot, with the costs against the petitioner.

After the presentation of the petition on the part of the said petitioner, one of the examiners of titles of the Court of Land Registration made an examination of the title claimed by the petitioner and made the following report to the judge of the said court of Land Registration.

The examiner of titles of this judicial district, after going over the papers in the case of the city, represented by its attorney, Modesto Reyes, states that:

1. The application filed by the city of Manila, is not accompanied by any document relative to its alleged ownership, but sets forth that said city, as the successor in rights and interest of the former ayuntamiento de Manila, is the owner of the land described in the petition above referred to.

2. In the office of the register of deeds there is no record of any act or contract opposing the claim of the applicant; nor does there appear, from the investigations held, any fact contrary to those quoted in the application. The present limits of the land in question may be held as correct.

3. The city of Manila, in order to acquire title to the land above mentioned, must show the ownership which the former ayuntamiento had over said land.

OPINION.

Based on the above report, the undersigned is of the opinion that the title of the city of Manila, represented by its attorney, Modesto Reyes, is defective and can not be registered.

Manila, December 7, 1904.

AGUEDO VELARDE.

On the 14th of March, 1905, the cause was duly brought on for trial and during the trial of said cause the petitioner attempted to establish by proof the following facts

First. That said land formerly belonged to the old city of Manila (ayuntamiento de Manila) under the sovereignty of Spain.

Second. That the present city of Manila is at present the owner of said land by virtue of being the successor of the old city of Manila.

Third. That the old city of Manila from the year 1894 until the change of sovereignty in the Philippine Archipelago had rented said land, had received rents therefor, and in a general way had administered the same.

The respondent, the Central Government of the Philippine Islands, presented no proof whatever in opposition to the claim of the petitioner, relying the fact that the petitioner was not entitled to have said land registered, for the following reasons:

First. That the land in question was public land, belonging to the Central Government; that the same had never been granted to any person or corporation or municipality by the Spanish Government.

Second. That the city of Manila, neither the present nor the old city, was the owner of said land.

On the 15th day of February, 1906, the judge of the said court filed his decision by which he denied the registration of the land claimed by the said Geronimo Morales and granted

the registration of the rest of said described property in favor of the said city. Against this order allowing the registration of said tract of land the respondent duly excepted and gave notice of his intention to appeal.

The Attorney-General, representing the respondent in this court, made the following assignment of error:

There is nothing in the record which justifies the conclusion of the judgment of the court below, to the effect that the land in question is owned by the city of Manila.

The only proof presented during the trial by the petitioner which tended in any way to support its claim was that in the year 1894 and thereafter the old city of Manila (ayuntamiento de Manila) rented said land and received the rent therefor, and that the present city of Manila succeeded to the rights of said old city. No proof was offered by the plaintiff, documentary or other, to show in any way by what right said old city exercised this right of control over said property.

We are of the opinion, and so hold, that the mere renting of property and receiving the rent therefor can not, of themselves, in the absence of other proof, support a claim of ownership of such property.

It has been argued that every pueblo organized by the Spanish Government in its insular possessions has had granted to it, as a matter of course, certain lands for public purposes, such as public commons, pasture lands, etc. Our attention has not been called to any law or royal decree in which this contention is supported and we have searched in vain to find such a provision. Upon the contrary we have found a royal decree of the — day of — showing that the people of the pueblo of Dilao (now the barrio of Paco in which this very land is located) had petitioned for a grant of a comunal, etc., and which was denied.

One of the earliest provisions of law relating to the rights of pueblos in the insular possessions of the Spanish Government is that de las reducciones, y pueblos de indios (settlements and pueblos of natives) of December 1, 1573, as amended by that of the 10th of October, 1618, found in Law VIII, Title III of Book VI of the Recopilacion de las Leyes de Indias, and which it as follows:

The sites whereon the pueblos and settlements are to be built must have water facilities, lands, forests, entrances and exits, lands for cultivation, and an exido (common, public land) one league long, wherein the natives may keep their cattle, without mingling them with those owned by Spaniards.

This provision of law seems to have been amplified in article 53 of the Ordinances of Good Government, dated February 26, 1768, and extended to the pueblos of the Philippine Islands by proclamation on the 11th day of September, 1801. This article clearly indicates that these lands should be designated by the Spanish Government for the use and benefit de las reducciones, y pueblos de los indios. Said article 53 is in part as follows:

It is held to be comunal (common public) the territory of the settlements and pueblos inhabited by natives, to which, from the time of their foundation or organization, the necessary lands were alloted in conformity with Law VII, Title III, Book VI of the Recopilacion de las Leyes de Indias, etc.

This article 53 clearly indicates the following:

First. That the King continued to be the absolute owner of said lands;

Second. That the pueblos were only given the mere usufruct of the same;

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Third. That the King might at any time annul such grant; and

Fourth. That a designation, of the particular land so granted, was a necessary prerequisite for the holding of the same for the purposes indicated, by the said pueblo. (See Autos Acordados, Vol. I, pp. 29, 48.)

As a further confirmation of the fact that the pueblos of the Philippine Islands did not have, as a matter of right, a comunal, etc., unless the same had been expressly granted, we find the following provision in the royal decree of February 28, 1883, which is as follows:

On the recommendation of the minister for the colonies, and in conformity with the opinion submitted by the council of the state, sitting in banc, I hereby decree the following:

ARTICLE 1. The legua comunal for the Philippine Islands, under the provisions of Law VIII, Title III, Book VI, of the Recopilacion de Indias, as far as the pueblos already established and those which may be established thereafter are concerned, shall be of an area of 20,000 feet, equivalent to a league of 20 degrees, without regard to the geometrical figure resulting from the topography of the locality, or to conditions relating to property rights over the land itself or over land adjoining the same.

ART. 2. The pueblos not having said land alloted to them may apply and obtain the same by means of the corresponding proceedings.

ART. 3. When the conditions so require, the pueblos may institute proceedings to obtain an extension of said comunal land, in order that the latter may be in keeping with the number of inhabitants, the number of heads of each pueblo. Given at the palace, on February 28, 1883.

Following this royal decree we have the superior decreto of the 1st of August, 1883, relating to the legua comunal, with the following provisions:

Legua comunal. — In order to comply with and carry out the provisions of the royal decree of February 28 of the current year, published in the Gaceta de Manila on June 28 last, and relating to the legua comunal, on the recommendation of the direccion general de administracion civil, I hereby order that the following regulations be observed:

1. The provincial chiefs shall take special care to inform the gobernadorcillos of the towns under their control of the decree relating to the legua comunal, making them understand that the superficial extension to be occupied by the same is that corresponding to a square, the sides of which measure 20,000 feet, equivalent to a square league, (de veinte al drado), and that the land should be uncultivated or untilled.

2. The towns not having said portion of land assigned may apply for the same to this central government through the chief of the province or district, inclosing with the petition a report of the principalia, stating the said circumstance and as many particulars as may exist in their archives regarding the matter.

3. The said documents shall be forwarded to the direccion general de administracion civil, through the provincial chief, and the said office, upon the information from the bureau of forestry, shall recommend to me what it may deem proper.

4. After the "legua comunal" has been granted by this Government, the bureau of forestry shall

proceed to the setting up of the boundary marks of the same, executing a certificate of the land, which, after being signed by the officer conducting the proceedings and by the principalia of the town, will be submitted for my approval through the direccion general de administracion civil.

5. For the legua comunal uncultivated land will be selected, whenever possible, which may be in proper condition for the pasture of cattle and cultivation of building timber and the necessary industries to meet the requirements of the inhabitants.

6. In order to increase the said communal land, when the requirements of the towns may demand, it will be necessary to institute new proceedings, which will be annexed to a statement signed by the principalia, showing the number of the inhabitants of the town, the kind and number of the extension of the lands which, bearing in mind the local conditions, they may deem necessary to meet the requirements of the former and nourishment for the latter.

7. These statements will be forwarded to the direccion general by the chief of the province, together with his opinion, in which he will state whether or not he considers the petition to be unreasonable.

8. The offices under the department of finance will furnish the direccion general de administracion with the necessary documents for verifying the truth of the declarations made by the principalias of the towns, regarding the number of the inhabitants and heads of cattle.

9. The direccion general de administracion civil, with the report of the bureau of forestry and, should it be deemed necessary, of the board of agriculture, shall recommend to me the extension to be finally marked for the legua comunal.

10. After the area of the land has been determined by this general government, the bureau of forestry shall proceed with the appointment and the setting of marks of the new communal land, a certificate being executed in the same form as previously stated.

11. The expenses arising from the proceedings, as well as those arising from the setting up of boundary marks of the legua comunal and its final establishment, must be paid by the town to which the concession has been granted. (Gazette No. 42, August 11.)

By the royal decree of the 23rd of December, 1870, it was made necessary by monuments or otherwise to mark the division lines of the different pueblos of the Philippine Islands. (Gaceta de Madrid, February 24.)

By the royal order of the 17th of January, 1885, it was provided that, when a pueblo should show to the Government of the Philippine Islands that its legua comunal was insufficient, it might, upon petition, have such lines increased. (Gaceta de Madrid, March 15, 1885.)

The royal decree of the 19th of May, 1893, relating to the municipal government (Gaceta de Madrid, May 22, 1893) contains no provisions with reference to the granting to pueblos of the legua comunal, etc.

The question of the right of pueblos in the insular possessions of the Spanish Government to public lands has come before the Supreme Court of the United States several times in its relation to pueblos in the territory acquired by the United States from the King of Spain.

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In the case of Grisar vs. McDowell (6 Wallace, 363, 373) Justice Field in discussing this question said:

These laws provided for the assignment to the pueblos, for their use and the use of their inhabitants, of land not exceeding in extent 4 square leagues. Such assignment was to be made by the public authorities of the Government upon the original establishment of the pueblo, or afterwards upon the petition of its officers or inhabitants; and the land to be measured off in a square or prolonged form, according to the nature and condition of the country. All lands within the general limits stated, which had previously become private property or were required for public purposes, were reserved and excepted from the assignment.

Until the lands were thus definitely assigned and measured off, the right or claim of the pueblo was an imperfect one. It was a right which the Government might refuse to recognize at all, or might recognize in a qualified form; it might be burdened with conditions, and it might be restricted to less limits than the 4 square leagues, which was the usual quantity assigned.

In the case of United States vs. Santa Fe (165 U. S., 707), in which this same question was involved, Justice White of the Supreme Court of the United States said:

It can not be doubted that under the law of Spain it was necessary that the proper authorities should particularly designate the land to be acquired by towns or pueblos before a vested right or title to the use thereof could arise.

Elizondo, in his work entitled Practica Universal Forense (vol. 5, p. 226), makes the following statement relating to the question presented here:

There is nothing whatever designated by law as belonging to towns, other than that which by royal privilege, custom, or contract between man and man is granted to them, so that although there be assigned to the towns at the time of their constitution territorio or pertinencias, which may be common to all the residents, without each one having the right to use them separately, it is a prerogative reserved to the sovereigns to divided the terminos of the provinces and towns, assigning to these the use and enjoyment, but the domain remaining in the sovereigns themselves.

Chief Justice Fuller, speaking for the court in the case of United States vs. Sandoval and in the case of Morton vs. United States (167 U.S., 278, 297), said:

"Under the laws of the Indies, lands not actually allotted to setters remained the property of the King, to be disposed of by him or by those on whom he might confer that power. As Mr. Hall says (Chap. VII, § 122): "The fee of the lands embraced within the limits of pueblos continued to remain in the sovereign, and never in the pueblo as a corporate body."

The petitioner herein not having presented proof showing that the land in question had been granted to it by the former sovereign in these Islands, and not having shown that it was entitled to said lands by virtue of some law of the present sovereign of these Islands, the Court of Land Registration was not empowered to grant the registration of said lands in favor of said petitioner. The judgment, therefore, of the lower court is hereby reversed. So ordered.

G.R. No. L-9069             March 31, 1915

THE MUNICIPALITY OF CAVITE, plaintiff-appellant, vs.

HILARIA ROJAS and her husband TIUNG SIUKO, alias SIWA, defendants-appellees.

Attorney-General Villamor for appellant.J. Y. Pinzon for appellees.

TORRES, J.:

Appeal filed through bill of exceptions by the Attorney-General, representing the plaintiff municipality of Cavite, from the judgment of March 27, 1913, whereby the Honorable Herbert D. Gale, judge, dismissed the complaint with costs against the plaintiff party, declaring that the said municipality had no right to require that the defendants vacate the land in question.

By an instrument dated December 5, 1911, afterwards amended on March 14, 1912, the provincial fiscal of Cavite, representing the municipality of that name, filed a complaint in the Court of First Instance of said province alleging that the plaintiff municipal corporation, duly organized and constituted in accordance with Act No. 82, and as the successor to the rights s aid entity had under the late Spanish government, and by virtue of Act No. 1039, had exclusive right, control and administration over the streets, lanes, plazas, and public places of the municipality of Cavite; that the defendants, by virtue of a lease secured from the plaintiff municipality, occupy a parcel of land 93 square meters in area that forms part o the public plaza known under the name of Soledad, belonging to the municipality of Cavite, the defendants having constructed thereon a house, through payment to the plaintiff for occupation thereof of a rental of P5,58 a quarter in advance, said defendants being furthermore obligated to vacate the leased land within sixty days subsequent to plaintiff's demand to that effect; that the defendants have been required by the municipality to vacate and deliver possession of the said land, but more than the sixty days within which they having done so to date; that the lease secured from the municipality of Cavite, by virtue whereof the defendants occupy the land that is the subject matter of the complaint, is ultra vires and therefore ipso facto null and void and of no force or effect, for the said land is an integral portion of a public plaza of public domain and use, and the municipal council of Cavite has never at any time had any power or authority to withdraw it from public use, and to lease it to a private party for his own use, and so the defendants have never had any right or occupy or to retain the said land under leasehold, or in any other way, their occupation of the parcel being furthermore illegal; and therefore prayed that judgment be rendered declaring that possession of the sad land lies with the plaintiff and ordering the defendants to vacate the land and deliver possession thereof to said plaintiff, with the costs against the defendants.

The demurrer filed to the foregoing complaint having been overruled, with exception on the part of the defendants, in their answer of April 10, 1912, they admitted some of the allegations contained in the complaint but denied that the parcel of land which they occupy and to which the complaint refers forms and integral part of Plaza Soledad, or that the lease secured by them from the municipality of Cavite was null and void and ultra vires, stating if they refused to vacate said land it was because they had acquired the right of possession thereof. As a special defense they alleged that, according to the lease, they could only be ordered to vacate the land leased when the plaintiff municipality might need it for decoration or other public use, which does not apply in the present case; and in a cross-complaint they alleged that on the land which is the subject matter of the complaint the defendants have erected a house of strong materials, assessed at P3,000, which was constructed under a license secured from the plaintiff municipality; that if they should be ordered to vacate the said land they would suffer damages to the extent of P3,000, wherefore they prayed that they be absolved from the complaint, or in the contrary case that the plaintiff be sentenced to indemnify them in the sum of P3,000 as damages, and to pay the costs.

After hearing of the case, wherein both parties submitted parol and documentary evidence, the court rendered the judgment that he been mentioned, whereto counsel for the

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municipality excepted and in writing asked for a reopening of the case and the holding of a new trial. This motion was denied, with exception on the part of the appellant, and the forwarded to the clerk of this court.

It is duly proven in the record that, upon presentation of an application by Hilaria Rojas, he municipal council of Cavite by resolution No. 10, dated July 3, 107, Exhibit C, leased to the said Rojas some 70 or 80 square meters of Plaza Soledad, on condition that she pay rent quarterly in advance according to the schedule fixed in Ordinance No. 43, land within sixty days subsequent to notification to that effect. The record shows (receipts, Exhibit 1) that she has paid the land tax on the house erected on the lot.

The boundary line between the properties of the municipality of Cavite and the naval reservation, as fixed in Act No. 1039 of the Philippine Commission, appears in the plan prepared by a naval engineer and submitted as evidence by the plaintiff, Exhibit C of civil case No. 274 of the Cavite court and registered in this court as No. 9071. According to said plan, defendant's house is erected on a plat of ground that forms part of the promenade called Plaza Soledad, and this was also so proven by the testimony of the plaintiff's witnesses.

By section 3 of the said Act No. 1039, passed January 12, 1904, the Philippine Commission granted to the municipality of Cavite all the land included in the tract called Plaza Soledad. In the case of Nicolas vs. Jose (6 Phil. Rep., 589), wherein the municipality of Cavite, represented by its president Catalino Nicolas, sought inscription in its name of the land comprised in the said Palza Soledad, with objection on the part of Maria Jose et al. who is sought that inscription be decreed in their name of the parcels of land in this plaza occupied by them, this court decided that neither the municipality nor the objectors were entitled to inscription, for with respect to the objectors said plaza belonged to the municipality of Cavite and with respect to the latter the said Plaza Soledad was not transferable property of that municipality to be inscribed in its name, because he intention of Act No. 1039 was that the said plaza and other places therein enumerated should be kept open for public transit; herefore there can be no doubt that the defendant has no right to continue to occupy the land of the municipality leased by her, for it is an integral portion of Plaza Soledad, which if for public use and is reserved for the common benefit.

According to article 344 of the Civil Code: "Property for public use in provinces and in towns comprises the provincial and town roads, the squares, streets, fountains, and public waters, the promenades, and public works of general service supported by said towns or provinces."

The said Plaza Soledad being a promenade for public use, the municipal council of Cavite could not in 1907 withdraw or exclude from public use a portion thereof in order to lease it for the sole benefit of the defendant Hilaria Rojas. In leasing a portion of said plaza or public place to the defendant for private use the plaintiff municipality exceeded its authority in the exercise of its powers by executing a contract over a thing of which it could not dispose, nor is it empowered so to do.

The Civil Code, articles 1271, prescribes that everything which is not outside he commerce of man may be the object of a contract, and plazas and streets are outside of this commerce, as was decided by the supreme court of Spain in its decision of February 12, 195, which says: "Communal things that cannot be soud because they are by their very nature outside of commerce are those for public use, such as the plazas, streets, common lands, rivers, fountains, etc."

Therefore, it must be concluded that the contract, Exhibit C, whereby he municipality of Cavite leased to Hilaria Rojas a portion of the Plaza Soledad is null and void and of no force or effect, because it is contrary to the law and the thing leased cannot be the object of a contract. On the hyphotesis that the said lease is null and void in accordance with the provisions of article 1303 of the Civil Code, the defendant must restore and deliver possession of the land described in

the complaint to the municipality of Cavite, which in its turn must restore to the said defendant all the sums it may have received from her in the nature of rentals just as soon as she restores the land improperly leased. For the same reasons as have been set forth, and as said contract is null and void in its origin, it can produce no effect and consequently the defendant is not entitled to claim that the plaintiff municipality indemnity her for the damages she may suffer by the removal of her house from the said land.

For all the foregoing reasons we must reverse the judgment appealed from and declare, as we do declare, that the land occupied by Hilaria Rojas forms part of the public plaza called Soledad, and as the lease of said parcel of land is null and void, we order the defendant to vacate it and release the land in question within thirty days, leaving it cleared as it was before hr occupation. There is no ground for the indemnity sought in the nature of damages, but the municipality must in its turn to the defendant the rentals collected; without finding as to the costs. So ordered.

G.R. No. L-28379             March 27, 1929

THE GOVERNMENT OF THE PHILIPPINE ISLANDS, applicant-appellant, vs.CONSORCIA CABANGIS, ET AL., claimants-appellees.

Attorney-General Jaranilla for appellant.Abad Santos, Camus & Delgado for appellees.

VILLA-REAL, J.:

The Government of the Philippine Islands appeals to this court from the judgment of the Court of First Instance of Manila in cadastral proceeding No. 373 of the Court of First Instance of Manila, G. L. R. O. Cadastral Record No. 373, adjudicating the title and decreeing the registration of lots Nos. 36, 39 and 40, block 3055 of the cadastral survey of the City of Manila in favor of Consuelo, Consorcia, Elvira and Tomas, surnamed Cabangis, in equal parts, and dismissing the claims presented by the Government of the Philippine Islands and the City of Manila.

In support of its appeal, the appellant assigns the following alleged errors as committed by the trial court in its judgment, to wit:

1. The lower court erred in not holding that the lots in question are of the public domain, the same having been gained from the sea (Manila Bay) by accession, by fillings made by the Bureau of Public Works and by the construction of the break-water (built by the Bureau of Navigation) near the mouth of Vitas Estero.

2. The lower court erred in holding that the lots in question formed part of the big parcel of land belonging to the spouses Maximo Cabangis and Tita Andres, and in holding that these spouses and their successors in interest have been in continuous, public, peaceful and uninterrupted possession of said lots up to the time this case came up.

3. The lower court erred in holding that said lots existed before, but that due to the current of the Pasig River and to the action of the big waves in Manila Bay during the south-west monsoons, the same disappeared.

4. The lower court erred in adjudicating the registration of the lands in question in the name of the appellees, and in

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denying the appellant's motion for a new trial.

A preponderance of the evidence in the record which may properly be taken into consideration in deciding the case, proves the following facts:

Lots 36, 39 and 40, block 3035 of cadastral proceeding No. 71 of the City of Manila, G. L. R. O. Record No. 373, were formerly a part of a large parcel of land belonging to the predecessor of the herein claimants and appellees. From the year 1896 said land began to wear away, due to the action of the waves of Manila Bay, until the year 1901 when the said lots became completely submerged in water in ordinary tides, and remained in such a state until 1912 when the Government undertook the dredging of Vitas Estuary in order to facilitate navigation, depositing all the sand and silt taken from the bed of the estuary on the low lands which were completely covered with water, surrounding that belonging to the Philippine Manufacturing Company, thereby slowly and gradually forming the lots, the subject matter of this proceeding.

Up to the month of February, 1927 nobody had declared lot 39 for the purposes of taxation, and it was only in the year 1926 that Dr. Pedro Gil, in behalf of the claimants and appellees, declared lot No. 40 for such purpose.

In view of the facts just stated, as proved by a preponderance of the evidence, the question arises: Who owns lots 36, 39 and 40 in question?

The claimants-appellees contend that inasmuch as the said lots once formed a part of a large parcel of land belonging to their predecessors, whom they succeeded, and their immediate predecessor in interest, Tomas Cabangis, having taken possession thereof as soon as they were reclaimed, giving his permission to some fishermen to dry their fishing nets and deposit their bancas thereon, said lots belong to them.

Article 339, subsection 1, of the Civil Code, reads:

Article 339. Property of public ownership is —

1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the State, riverbanks, shorts, roadsteads, and that of a similar character.

x x x           x x x           x x x

Article 1, case 3, of the Law of Waters of August 3, 1866, provides as follows:

ARTICLE 1. The following are part of the national domain open to public use:

x x x           x x x           x x x

3. The Shores. By the shore is understood that space covered and uncovered by the movement of the tide. Its interior or terrestrial limit is the line reached by the highest equinoctial tides. Where the tides are not appreciable, the shore begins on the land side at the line reached by the sea during ordinary storms or tempests.

In the case of Aragon vs. Insular Government (19 Phil., 223), with reference to article 339 of the Civil Code just quoted, this court said:

We should not be understood, by this decision, to hold that in a case of gradual encroachment or erosion by the ebb and

flow of the tide, private property may not become 'property of public ownership,' as defined in article 339 of the code, where it appears that the owner has to all intents and purposes abandoned it and permitted it to be totally destroyed, so as to become a part of the 'playa' (shore of the seas), 'rada' (roadstead), or the like. . . .

In the Enciclopedia Juridica Espanola, volume XII, page 558, we read the following:

With relative frequency the opposite phenomenon occurs; that is, the sea advances and private properties are permanently invaded by the waves, and in this case they become part of the shore or beach. They then pass to the public domain, but the owner thus dispossessed does not retain any right to the natural products resulting from their new nature; it is a de facto case of eminent domain, and not subject to indemnity.

Now then , when said land was reclaimed, did the claimants-appellees or their predecessors recover it as their original property?

As we have seen, the land belonging to the predecessors of the herein claimants-appellees began to wear way in 1896, owing to the gradual erosion caused by the ebb and flow of the tide, until the year 1901, when the waters of Manila Bay completely submerged a portion of it, included within lots 36, 39 and 40 here in question, remaining thus under water until reclaimed as a result of certain work done by the Government in 1912. According to the above-cited authorities said portion of land, that is, lots 36, 39 and 40, which was private property, became a part of the public domain. The predecessors of the herein claimants-appellees could have protected their land by building a retaining wall, with the consent of competent authority, in 1896 when the waters of the sea began to wear it away, in accordance with the provisions of Article 29 of the aforecited Law of Waters of August 3, 1866, and their failure to do so until 1901, when a portion of the same became completely covered by said waters, remaining thus submerged until 1912, constitutes abandonment.

Now then: The lots under discussion having been reclaimed from the seas as a result of certain work done by the Government, to whom do they belong?

The answer to this question is found in article 5 of the aforementioned Law of Waters, which is as follows:

ART. 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by the provinces, pueblos or private persons, with proper permission, shall become the property of the party constructing such works, unless otherwise provided by the terms of the grant of authority.

The fact that from 1912 some fishermen had been drying their fishing nets and depositing their bancas on lots 36, 39 and 40, by permission of Tomas Cabangis, does not confer on the latter or his successors the ownership of said lots, because, as they were converted into public land, no private person could acquire title thereto except in the form and manner established by the law.

In the case of Buzon vs. Insular Government and City of Manila (13 Phil., 324), cited by the claimants-appellees, this court, admitting the findings and holdings of the lower court, said the following:

If we heed the parol evidence, we find that the seashore was formerly about

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one hundred brazas distant from the land in question; that, in the course of time, and by the removal of a considerable quantity of sand from the shore at the back of the land for the use of the street car company in filling in Calle Cervantes, the sea water in ordinary tides now covers part of the land described in the petition.

The fact that certain land, not the bed of a river or of the sea, is covered by sea water during the period of ordinary high tide, is not a reason established by any law to cause the loss thereof, especially when, as in the present case, it becomes covered by water owing to circumstances entirely independent of the will of the owner.

In the case of Director of Lands vs. Aguilar (G.R. No. 22034),1 also cited by the claimants-appellees, wherein the Government adduced no evidence in support of its contention, the lower court said in part:

The contention of the claimants Cabangis is to the effect that said lots are a part of the adjoining land adjudicated to their deceased father, Don Tomas Cabangis, which, for over fifty years had belonged to their deceased grandmother, Tita Andres, and that, due to certain improvements made in Manila Bay, the waters of the sea covered a large part of the lots herein claimed.

The Government of the Philippine Islands also claims the ownership of said lots, because, at ordinary high tide, they are covered by the sea.

Upon petition of the parties, the lower court made an ocular inspection of said lots on September 12, 1923, and on said inspection found some light material houses built thereon, and that on that occasion the waters of the sea did not reach the aforesaid lots.

From the evidence adduced at the trial of this cause, it may be inferred that Tita Andres, during her lifetime was the owner of a rather large parcel of land which was adjudicated by a decree to her son Tomas Cabangis; the lots now in question are contiguous to that land and are covered by the waters of the sea at extraordinary high tide; some 50 years before the sea did not reach said strip of land, and on it were constructed, for the most part, light material houses, occupied by the tenants of Tita Andres, to whom they paid rent. Upon her death, her son Tomas Cabangis succeeded to the possession, and his children succeeded him, they being the present claimants, Consuelo, Jesus, Tomas, and Consorcia Cabangis.

The Government of the Philippine Islands did not adduce any evidence in support of its contention, with the exception of registry record No. 8147, to show that the lots here in question were not excluded from the application presented in said proceeding.

It will be seen that in the case of Buzon vs. Insular Government and City of Manila, cited above, the rise of the waters of the sea that covered the lands there in dispute,

was due not to the action of the tide but to the fact that a large quantity of sand was taken from the sea at the side of said land in order to fill in Cervantes Street, and this court properly held that because of this act, entirely independent of the will of the owner of said land, the latter could not lose the ownership thereof, and the mere fact that the waters of the sea covered it as a result of said act, is not sufficient to convert it into public land, especially, as the land was high and appropriate for building purposes.

In the case of the Director of Lands vs. Aguilar also cited by the claimants-appellees, the Insular Government did not present any evidence in support of its contention, thus leaving uncontradicted the evidence adduced by the claimants Aguilar et al., as to the ownership, possession and occupation of said lots.

In the instant case the evidence shows that from 1896, the waves of Manila Bay had been gradually and constantly washing away the sand that formed the lots here in question, until 1901, when the sea water completely covered them, and thus they remained until the year 1912. In the latter year they were reclaimed from the sea by filling in with sand and silt extracted from the bed of Vitas Estuary when the Government dredged said estuary in order to facilitate navigation. Neither the herein claimants-appellees nor their predecessors did anything to prevent their destruction.

In conclusion, then, we hold that the lots in question having disappeared on account of the gradual erosion due to the ebb and flow of the tide, and having remained in such a state until they were reclaimed from the sea by the filling in done by the Government, they are public land. (Aragon vs. Insular Government, 19 Phil., 223; Francisco vs. Government of the Philippine Islands, 28 Phil., 505).

By virtue whereof, the judgment appealed from is reversed and lots Nos. 36, 39 and 40 of cadastral proceeding No. 373 of the City of Manila are held to be public land belonging to the Government of the United States under the administration and control of the Government of the Philippine Islands. So ordered.

G.R. No. L40474 August 29, 1975

CEBU OXYGEN & ACETYLENE CO., INC., petitioner, vs.HON. PASCUAL A. BERCILLES Presiding Judge, Branch XV, 14th Judicial District, and JOSE L. ESPELETA, Assistant Provincial Fiscal, Province of Cebu, representing the Solicitor General's Office and the Bureau of Lands, respondents.

Jose Antonio R Conde for petitioner.

Office of the Acting Solicitor General Hugo E. Gutierrez, Jr., Assistant Solicitor General Octavio R. Ramirez and Trial Attorney David R. Hilario for respondents. .

 

CONCEPCION, Jr., J.:

This is a petition for the review of the order of the Court of First Instance of Cebu dismissing petitioner's application for registration of title over a parcel of land situated in the City of Cebu.

The parcel of land sought to be registered was only a portion of M. Borces Street, Mabolo, Cebu City. On September 23, 1968, the City Council of Cebu, through Resolution No. 2193, approved on October 3, 1968, declared the terminal portion of M. Borces Street, Mabolo, Cebu City, as an abandoned road, the same not being included in the City Development Plan. 1 Subsequently, on December 19, 1968, the City Council of Cebu passed Resolution No. 2755, authorizing the Acting City Mayor to sell the land through a public bidding. 2 Pursuant thereto, the lot was awarded to the herein petitioner being the highest bidder and on March 3,

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1969, the City of Cebu, through the Acting City Mayor, executed a deed of absolute sale to the herein petitioner for a total consideration of P10,800.00. 3 By virtue of the aforesaid deed of absolute sale, the petitioner filed an application with the Court of First instance of Cebu to have its title to the land registered. 4

On June 26, 1974, the Assistant Provincial Fiscal of Cebu filed a motion to dismiss the application on the ground that the property sought to be registered being a public road intended for public use is considered part of the public domain and therefore outside the commerce of man. Consequently, it cannot be subject to registration by any private individual. 5

After hearing the parties, on October 11, 1974 the trial court issued an order dismissing the petitioner's application for registration of title. 6 Hence, the instant petition for review.

For the resolution of this case, the petitioner poses the following questions:

(1) Does the City Charter of Cebu City (Republic Act No. 3857) under Section 31, paragraph 34, give the City of Cebu the valid right to declare a road as abandoned? and

(2) Does the declaration of the road, as abandoned, make it the patrimonial property of the City of Cebu which may be the object of a common contract?

(1) The pertinent portions of the Revised Charter of Cebu City provides:

Section 31. Legislative Powers. Any provision of law and executive order to the contrary notwithstanding, the City Council shall have the following legislative powers:

xxx xxx xxx

(34) ...; to close any city road, street or alley, boulevard, avenue, park or square. Property thus withdrawn from public servitude may be used or conveyed for any purpose for which other real property belonging to the City may be lawfully used or conveyed.

From the foregoing, it is undoubtedly clear that the City of Cebu is empowered to close a city road or street. In the case of Favis vs. City of Baguio, 7 where the power of the city Council of Baguio City to close city streets and to vacate or withdraw the same from public use was similarly assailed, this court said:

5. So it is, that appellant may not challenge the city council's act of withdrawing a strip of Lapu-Lapu Street at its dead end from public use and converting the remainder thereof into an alley. These are acts well within the ambit of the power to close a city street. The city council, it would seem to us, is the authority competent to determine whether or not a certain property is still necessary for public use.

Such power to vacate a street or alley is discretionary. And the discretion will not ordinarily be controlled or interfered with by the courts, absent a plain case of abuse or fraud or collusion. Faithfulness to the public trust will be presumed. So the fact that some private interests may

be served incidentally will not invalidate the vacation ordinance.

(2) Since that portion of the city street subject of petitioner's application for registration of title was withdrawn from public use, it follows that such withdrawn portion becomes patrimonial property which can be the object of an ordinary contract.

Article 422 of the Civil Code expressly provides that "Property of public dominion, when no longer intended for public use or for public service, shall form part of the patrimonial property of the State."

Besides, the Revised Charter of the City of Cebu heretofore quoted, in very clear and unequivocal terms, states that: "Property thus withdrawn from public servitude may be used or conveyed for any purpose for which other real property belonging to the City may be lawfully used or conveyed."

Accordingly, the withdrawal of the property in question from public use and its subsequent sale to the petitioner is valid. Hence, the petitioner has a registerable title over the lot in question.

WHEREFORE, the order dated October 11, 1974, rendered by the respondent court in Land Reg. Case No. N-948, LRC Rec. No. N-44531 is hereby set aside, and the respondent court is hereby ordered to proceed with the hearing of the petitioner's application for registration of title.

SO ORDERED.

G.R. No. L-24950             March 25, 1926

VIUDA DE TAN TOCO, plaintiff-appellant, vs.THE MUNICIPAL COUNCIL OF ILOILO, defendant-appellee.

Arroyo & Evangelista for appellant.Provincial Fiscal Borromeo Veloso for appelle.

VILLAMOR, J.:

It appears from the record that the widow of Tan Toco had sued the municipal council of Iloilo for the amount of P42,966.40, being the purchase price of two strips of land, one on Calle J. M. Basa consisting of 592 square meters, and the other on Calle Aldiguer consisting of 59 square meters, which the municipality of Iloilo had appropriated for widening said street. The Court of First Instance of Iloilo sentenced the said municipality to pay the plaintiff the amount so claimed, plus the interest, and the said judgment was on appeal affirmed by this court.1

On account of lack of funds the municipality of Iloilo was unable to pay the said judgment, wherefore plaintiff had a writ of execution issue against the property of the said municipality, by virtue of which the sheriff attached two auto trucks used for street sprinkling, one police patrol automobile, the police stations on Mabini street, and in Molo and Mandurriao and the concrete structures, with the corresponding lots, used as markets by Iloilo, Molo, and Mandurriao.

After notice of the sale of said property had been made, and a few days before the sale, the provincial fiscal of Iloilo filed a motion which the Court of First Instance praying that the attachment on the said property be dissolved, that the said attachment be declared null and void as being illegal and violative of the rights of the defendant municipality.

Plaintiffs counsel objected o the fiscal's motion but the court, by order of August 12, 1925, declared the attachment levied upon the aforementioned property of the defendant municipality null and void, thereby dissolving the said attachment.

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From this order the plaintiff has appealed by bill of exceptions. The fundamental question raised by appellant in her four assignments of error is whether or not the property levied upon is exempt from execution.

The municipal law, section 2165 of the Administrative Code, provides that:

Municipalities are political bodies corporate, and as such are endowed with the faculties of municipal corporations, to be exercised by and through their respective municipal government in conformity with law.

It shall be competent for them, in their proper corporate name, to sue and be sued, to contract and be contracted with, to acquire and hold real and personal property for municipal purposes, and generally to exercise the powers hereinafter specified or otherwise conferred upon them by law.

For the purposes of the matter here in question, the Administrative Code does not specify the kind of property that a municipality may acquire. However, article 343 of the Civil Code divides the property of provinces and towns (municipalities) into property for public use and patrimonial property. According to article 344 of the same Code, provincial roads and foot-path, squares, streets, fountains and public waters, drives and public improvements of general benefit built at the expense of the said towns or provinces, are property for public use.

All other property possessed by the said towns and provinces is patrimonial and shall be subject to the provisions of the Civil Code except as provided by special laws.

Commenting upon article 344, Mr. Manresa says that "In accordance with administrative legislation" (Spanish) we must distinguish, as to the patrimonial property of the towns, "between that a common benefit and that which is private property of the town. The first differs from property for public use in that generally its enjoyment is less, as it is limited to neighbors or to a group or class thereof; and, furthermore, such use, more or less general, is not intrinsic with this kind of property, for by its very nature it may be enjoyed as though it were private property. The third group, that is, private property, is used in the name of the town or province by the entities representing it and, like and private property, giving a source of revenue."

Such distinction, however, is of little practical importance in this jurisdiction in view of the different principles underlying the functions of a municipality under the American rule. Notwithstanding this, we believe that the principle governing property of the public domain of the State is applicable to property for public use of the municipalities as said municipal is similar in character. The principle is that the property for public use of the State is not within the commerce of man and, consequently, is inalienable and not subject to prescription. Likewise, property for public of the municipality is not within the commerce of man so long as it is used by the public and, consequently, said property is also inalienable.

The American Law is more explicit about this matter as expounded by Mcquilin in Municipal Corporations, volume 3, paragraph 1160, where he says that:

States statutes often provide the court houses, jails and other buildings owned by municipalities and the lots on which they stand shall be exempt from attachment and execution. But independent of express statutory exemption, as a general proposition, property, real and personal, held by municipal corporations, in trust for the benefit of their inhabitants, and used for public purposes, is exempt.

For example, public buildings, school houses, streets, squares, parks, wharves, engines and engine houses, and the like, are not subject to execution. So city waterworks, and a stock of liquors carried in a town dispensary, are exempt. The reason for the exemption is obvious. Municipal corporations are created for public purposes and for the good of the citizens in their aggregate or public capacity. That they may properly discharge such public functions corporate property and revenues are essential, and to deny them these means the very purpose of their creation would be materially impeded, and in some instances practically destroy it. Respecting this subject the Supreme Court of Louisiana remarked: "On the first view of this question there is something very repugnant to the moral sense in the idea that a municipal corporation should contract debts, and that, having no resources but the taxes which are due to it, these should not be subjected by legal process to the satisfaction of its creditors. This consideration, deduced from the principles of moral equity has only given way to the more enlarged contemplation of the great and paramount interests of public order and the principles of government."

It is generally held that property owned by a municipality, where not used for a public purpose but for quasi private purposes, is subject to execution on a judgment against the municipality, and may be sold. This rule applies to shares of stock owned by a municipal corporation, and the like. But the mere fact that corporate property held for public uses is being temporarily used for private purposes does not make it subject execution.

If municipal property exempt from execution is destroyed, the insurance money stands in lieu thereof and is also exempt.

The members or inhabitants of a municipal corporation proper are not personally liable for the debts of the municipality, except that in the New England States the individual liability of the inhabitant is generally maintained.

In Corpus Juris, vol 23, page 355, the following is found:

Where property of a municipal or other public corporation is sough to be subjected to execution to satisfy judgments recovered against such corporation, the question as to whether such property is leviable or not is to be determined by the usage and purposes for which it is held. The rule is that property held for public uses, such as public buildings, streets, squares parks, promenades, wharves, landing places fire engines, hose and hose carriages, engine houses, public markets, hospitals, cemeteries, and generally everything held for governmental purposes, is not subject to levy and sale under execution against such corporation. The rule also applies to funds in the hands of a public officer. Likewise it has been held that taxes due to a municipal corporation or country cannot be seized under execution by a creditor of such corporation. But where a municipal corporation or country owns in its proprietary, as distinguished from its public or governmental capacity, property not useful or used for a public purpose but for quasi private purposes, the general rule is that such property may be seized and sold under execution against the corporation, precisely as similar property of individuals is seized and sold. But property held for public purposes is not subject to execution merely because it is temporarily used for private purposes, although if the public use is wholly abandoned it becomes subject to execution. Whether or not property held as public property is necessary for the public use is a political, rather than a judicial question.

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In the case of City of New Orleans vs. Louisiana Construction Co., Ltd. (140 U. S., 654; 35 Law. ed., 556), it was held that a wharf for unloading sugar and molasses, open to the public, was property for the public use of the City of New Orleans and was not subject to attachment for the payment of the debts of the said city.

In that case it was proven that the said wharf was a parcel of land adjacent to the Mississippi River where all shipments of sugar and molasses taken to New Orleans were unloaded.

That city leased the said wharf to the Louisiana Construction Company, Ltd., in order that it might erect warehouses so that the merchandise upon discharge might not be spoiled by the elements. The said company was given the privilege of charging certain fees for storing merchandise in the said warehouses and the public in general had the right to unload sugar and molasses there by paying the required fees, 10 per cent of which was turned over to the city treasury.

The United States Supreme Court on an appeal held that the wharf was public property, that it never ceased to be such in order to become private property of the city; wherefore the company could not levy execution upon the wharf in order to collect the amount of the judgment rendered in favor thereof.

In the case of Klein vs. City of New Orleans (98 U. S., 149; 25 Law. ed., 430), the Supreme Court of the United States that a public wharf on the banks of the Mississippi River was public property and not subject to execution for the payment of a debt of the City of New Orleans where said wharf was located.

In this case a parcel of land adjacent to the Mississippi River, which formerly was the shore of the river and which later enlarged itself by accession, was converted into a wharf by the city for public use, who charged a certain fee for its use.

It was held that the land was public property as necessary as a public street and was not subject to execution on account of the debts of the city. It was further held that the fees collected where also exempt from execution because they were a part of the income of the city.

In the case of Tufexis vs. Olaguera and Municipal Council of Guinobatan (32 Phil., 654), the question raised was whether for the payment of a debt to a third person by the concessionaire of a public market, the said public market could be attached and sold at public auction. The Supreme Court held that:

Even though a creditor is unquestionably entitled to recover out of his debtor's property, yet when among such property there is included the special right granted by the Government of usufruct in a building intended for a public service, and when this privilege is closely related to a service of a public character, such right of the creditor to the collection of a debt owed him by the debtor who enjoys the said special privilege of usufruct in a public market is not absolute and may be exercised only through the action of court of justice with respect to the profits or revenue obtained under the special right of usufruct enjoyed by debtor.

The special concession of the right of usufruct in a public market cannot be attached like any ordinary right, because that would be to permit a person who has contracted with the state or with the administrative officials thereof to conduct and manage a service of a public character, to be substituted, without the knowledge and consent of the administrative authorities, by one who took no part in the contract, thus giving rise to the possibility of the regular course of a public service being disturbed by the more or less legal action of a grantee, to the prejudice of the state and the public interests.

The privilege or franchise granted to a private person to enjoy the usufruct of a public market cannot lawfully be attached and sold, and a creditor of such person can recover his debt only out of the income or revenue obtained by the debtor from the enjoyment or usufruct of the said privilege, in the same manner that the rights of such creditors of a railroad company can be exercised and their credit collected only out of the gross receipts remaining after deduction has been made therefrom of the operating expenses of the road. (Law of November 12, 1896, extended to the overseas provinces by the royal order of August 3, 1886.)

For the reasons contained in the authorities above quoted we believe that this court would have reached the same conclusion if the debtor had been municipality of Guinobatan and the public market had been levied upon by virtue of the execution.

It is evident that the movable and immovable property of a municipality, necessary for governmental purpose, may not be attached and sold for the payment of a judgment against the municipality. The supreme reason for this rule is the character of the public use to which such kind of property is devoted. The necessity for government service justifies that the property of public of the municipality be exempt from execution just as it is necessary to exempt certain property of private individuals in accordance with section 452 of the Code of Civil Procedure.

Even the municipal income, according to the above quoted authorities, is exempt from levy and execution. In volume 1, page 467, Municipal Corporations by Dillon we find that:

Municipal corporations are instituted by the supreme authority of a state for the public good. They exercise, by delegation from the legislature, a portion of the sovereign power. The main object of their creation is to act as administrative agencies for the state, and to provide for the police and local government of certain designated civil divisions of its territory. To this end they are invested with certain governmental powers and charged with civil, political, and municipal duties. To enable them beneficially to exercise these powers and discharge these duties, they are clothed with the authority to raise revenues, chiefly by taxation, and subordinately by other modes as by licenses, fines, and penalties. The revenue of the public corporation is the essential means by which it is enabled to perform its appointed work. Deprived of its regular and adequate supply of revenue, such a corporation is practically destroyed and the ends of its erection thwarted. Based upon considerations of this character, it is the settled doctrine of the law that only the public property but also the taxes and public revenues of such corporations cannot be seized under execution against them, either in the treasury or when in transit to it. Judgments rendered for taxes, and the proceeds of such judgments in the hands of officers of the law, are not subject to execution unless so declared by statute. The doctrine of the inviolability of the public revenues by the creditor is maintained, although the corporation is in debt, and has no means of payment but the taxes which it is authorized to collect.

Another error assigned by counsel for appellant is the holding of the court a quo that the proper remedy for collecting the judgment in favor of the plaintiff was by way or mandamus.

While this question is not necessarily included in the one which is the subject of this appeal, yet we believe that the holding of the court, assigned as error by appellant's counsel, is true when, after a judgment is rendered against a municipality, it has no property subject to execution. This doctrine is maintained by Dillon (Municipal Corporations, vol. 4, par. 1507, 5th ed.) based upon the decisions of several

21

States of the Union upholding the same principle and which are cited on page 2679 of the aforesaid work. In this sense this assignment of error, we believe, is groundless.

By virtue of all the foregoing, the judgment appealed from should be and is hereby affirmed with costs against the appellant. So ordered.

G.R. No. L-29788 August 30, 1972

RAFAEL S. SALAS, in his capacity as Executive Secretary; CONRADO F. ESTRELLA, in his capacity as Governor of the Land Authority; and LORENZO GELLA, in his capacity as Register of Deeds of Manila, petitioners-appellants, vs.HON. HILARION U. JARENCIO, as Presiding Judge of Branch XXIII, Court of First Instance of Manila; ANTONIO J. VILLEGAS, in his capacity as Mayor of the City of Manila; and the CITY OF MANILA, respondents-appellees.

Office of the Solicitor General Felix V. Makasiar, Assistant Solicitor-General Antonio A. Torres, Solicitor Raul I. Goco and Magno B. Pablo & Cipriano A. Tan, Legal Staff, Land Authority for petitioners-appellants.

Gregorio A. Ejercito and Felix C. Chavez for respondents-appellees.

 

ESGUERRA, J.:p

This is a petition for review of the decision of the Court of First Instance of Manila, Branch XXIII, in Civil Case No. 67946, dated September 23, 1968, the dispositive portion of which is as follows:

WHEREFORE, the Court renders judgment declaring Republic Act No. 4118 unconstitutional and invalid in that it deprived the City of Manila of its property without due process and payment of just compensation. Respondent Executive Secretary and Governor of the Land Authority are hereby restrained and enjoined from implementing the provisions of said law. Respondent Register of Deeds of the City of Manila is ordered to cancel Transfer Certificate of Title No. 80876 which he had issued in the name of the Land Tenure Administration and reinstate Transfer Certificate of Title No. 22547 in the name of the City of Manila which he cancelled, if that is feasible, or issue a new certificate of title for the same parcel of land in the name of the City of Manila. 1

The facts necessary for a clear understanding of this case are as follows:

On February 24, 1919, the 4th Branch of the Court of First Instance of Manila, acting as a land registration court, rendered judgment in Case No. 18, G.L.R.O. Record No. 111, declaring the City of Manila the owner in fee simple of a parcel of land known as Lot No. 1, Block 557 of the Cadastral Survey of the City of Mani1a, containing an area of 9,689.8 square meters, more or less. Pursuant to said judgment the Register of Deeds of Manila on August 21, 1920, issued in favor of the City of Manila, Original Certificate of Title No. 4329 covering the aforementioned parcel of land. On various dates in 1924, the City of Manila sold portions of the aforementioned parcel of land in favor of Pura Villanueva. As a consequence of the transactions Original Certificate of Title No. 4329 was cancelled and transfer certificates of title were issued in favor of Pura Villanueva for the portions purchased by her. When the last sale to Pura Villanueva was effected on August 22, 1924,

Transfer Certificate of Title No. 21974 in the name of the City of Manila was cancelled and in lieu thereof Transfer Certificate of Title (TCT) No. 22547 covering the residue thereof known as Lot 1-B-2-B of Block 557, with an area of 7,490.10 square meters, was issued in the name of the City of Manila.

On September 21, 1960, the Municipal Board of Manila, presided by then Vice-Mayor Antono J. Villegas, adopted a resolution requesting His Excellency, the President of the Philippines to consider the feasibility of declaring the City property bounded by Florida, San Andres, and Nebraska Streets, under Transfer Certificate of Title Nos. 25545 and 22547, containing a total area of 7,450 square meters as a patrimonial property of the City of Manila for the purpose of reselling these lots to the actual occupants thereof. 2

The said resolution of the Municipil Board of the City of Manila was officially transmitted to the President of the Philippines by then Vice-Mayor Antonio J. Villegas on September 21, 1960, with the information that the same resolution was, on the same date, transmitted to the Senate and House of Representatives of the Congress of the Philippines. 3

During the First Session of the Fifth Congress of the Philippines, House Bill No. 191 was filed in the House of Representatives by then Congressman Bartolome Cabangbang seeking to declare the property in question as patrimonial property of the City of Manila, and for other purposes. The explanatory note of the Bill gave the grounds for its enactment, to wit:

In the particular case of the property subject of this bill, the City of Manila does not seem to have use thereof as a public communal property. As a matter of fact, a resolution was adopted by the Municipal Board of Manila at its regular session held on September 21, 1960, to request the feasibility of declaring the city property bounded by Florida, San Andres and Nebraska Streets as a patrimonial property of the City of Manila for the purpose of reselling these lots to the actual occupants thereof. Therefore, it will be to the best interest of society that the said property be used in one way or another. Since this property has been occupied for a long time by the present occupants thereof and since said occupants have expressed their willingness to buy the said property, it is but proper that the same be sold to them. 4

Subsequently, a revised version of the Bill was introduced in the House of Representatives by Congressmen Manuel Cases, Antonio Raquiza and Nicanor Yñiguez as House Bill No. 1453, with the following explanatory note:

The accompanying bill seeks to convert one (1) parcel of land in the district of Malate, which is reserved as communal property into a disposable or alienable property of the State and to provide its subdivision and sale to bona fide occupants or tenants.

This parcel of land in question was originally an aggregate part of a piece of land with an area of 9,689.8 square meters, more or less. ... On September 21, 1960, the Municipal Board of Manila in its regular session unanimously adopted a resolution requesting the President of the Philippines and Congress of the Philippines the feasibility of declaring this property into disposable or alienable property of the State. There is therefore a precedent that this parcel of land could be

22

subdivided and sold to bona fide occupants. This parcel of land will not serve any useful public project because it is bounded on all sides by private properties which were formerly parts of this lot in question.

Approval of this bill will implement the policy of the Administration of land for the landless and the Fifth Declaration of Principles of the Constitution, which states that the promotion of Social Justice to insure the well-being and economic security of all people should be the concern of the State. We are ready and willing to enact legislation promoting the social and economic well-being of the people whenever an opportunity for enacting such kind of legislation arises.

In view of the foregoing consideration and to insure fairness and justice to the present bona fide occupants thereof, approval of this Bill is strongly urged. 5

The Bill having been passed by the House of Representatives, the same was thereafter sent to the Senate where it was thoroughly discussed, as evidenced by the Congressional Records for May 20, 1964, pertinent portion of which is as follows:

SENATOR FERNANDEZ: Mr. President, it will be re called that when the late Mayor Lacson was still alive, we approved a similar bill. But afterwards, the late Mayor Lacson came here and protested against the approval, and the approval was reconsidered. May I know whether the defect in the bill which we approved, has already been eliminated in this present bill?

SENATOR TOLENTINO: I understand Mr. President, that that has already been eliminated and that is why the City of Manila has no more objection to this bill.

SENATOR FERNANDEZ: Mr. President, in view of that manifestation and considering that Mayor Villegas and Congressman Albert of the Fourth District of Manila are in favor of the bill. I would not want to pretend to know more what is good for the City of Manila.

SENATOR TOLENTINO: Mr. President, there being no objection, I move that we approve this bill on second reading.

PRESIDENT PRO-TEMPORE: The biII is approved on second reading after several Senetors said aye and nobody said nay.

The bill was passed by the Senate, approved by the President on June 20, 1964, and became Republic Act No. 4118. It reads as follows:

Lot I-B-2-B of Block 557 of the cadastral survey of the City of Manila, situated in the District of Malate, City of Manila, which is reserved as communal property, is hereby converted into disposal or alienable land of the State, to be placed under the disposal of the Land Tenure Administration. The Land Tenure Administration shall subdivide the property into small lots, none of which shall exceed one hundred and

twenty square meters in area and sell the same on installment basis to the tenants or bona fide occupants thereof and to individuals, in the order mentioned: Provided, That no down payment shall be required of tenants or bona fide occupants who cannot afford to pay such down payment: Provided, further, That no person can purchase more than one lot: Provided, furthermore, That if the tenant or bona fide occupant of any given lot is not able to purchase the same, he shall be given a lease from month to month until such time that he is able to purchase the lot: Provided, still further, That in the event of lease the rentals which may be charged shall not exceed eight per cent per annum of the assessed value of the property leased: And provided, finally, That in fixing the price of each lot, which shall not exceed twenty pesos per square meter, the cost of subdivision and survey shall not be included.

Sec. 2. Upon approval of this Act no ejectment proceedings against any tenant or bona fide occupant of the above lots shall be instituted and any ejectment proceedings pending in court against any such tenant or bona fide occupant shall be dismissed upon motion of the defendant: Provided, That any demolition order directed against any tenant or bona fide occupant shall be lifted.

Sec. 3. Upon approval of this Act, if the tenant or bona fide occupant is in arrears in the payment of any rentals, the amount legally due shall be liquidated and shall be payable in twenty-four equal monthly installments from the date of liquidation.

Sec. 4. No property acquired by virtue of this Act shall be transferred, sold, mortgaged, or otherwise disposed of within a period of five years from the date full ownership thereof has been vested in the purchaser without the consent of the Land Tenure Administration.

Sec. 5. In the event of the death of the purchaser prior to the complete payment of the price of the lot purchased by him, his widow and children shall succeed in all his rights and obligations with respect to his lot.

Sec. 6. The Chairman of the Land Tenure Administration shall implement and issue such rules and regulations as may be necessary to carry out the provisions of this Act.

Sec. 7. The sum of one hundred fifty thousand pesos is appropriated out of any funds in the National Treasury not otherwise appropriated, to carry out the purposes of this Act.

Sec. 8. All laws or parts of laws inconsistent with this Act are repealed or modified accordingly.

Sec. 9. This Act shall take effect upon its approval.

Approved, June 20, 1964.

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To implement the provisions of Republic Act No. 4118, and pursuant to the request of the occupants of the property involved, then Deputy Governor Jose V. Yap of the Land Authority (which succeeded the Land Tenure Administration) addressed a letter, dated February 18, 1965, to Mayor Antonio Villegas, furnishing him with a copy of the proposed subdivision plan of said lot as prepared for the Republic of the Philippines for resale of the subdivision lots by the Land Authority to bona fide applicants. 6

On March 2, 1965, the City Mayor of Manila, through his Executive and Technical Adviser, acknowledged receipt of the proposed subdivision plan of the property in question and informed the Land Authority that his office would interpose no objection to the implementation of said law, provided that its provisions be strictly complied with. 7

With the above-mentioned written conformity of the City of Manila for the implementation of Republic Act No. 4118, the Land Authority, thru then Deputy Governor Jose V. Yap, requested the City Treasurer of Manila, thru the City Mayor, for the surrender and delivery to the former of the owner's duplicate of Transfer Certificate of Title No. 22547 in order to obtain title thereto in the name of the Land Authority. The request was duly granted with the knowledge and consent of the Office of the City Mayor. 8

With the presentation of Transfer Certificate of Title No. 22547, which had been yielded as above stated by the, City authorities to the Land Authority, Transfer Certificate of Title (T.C.T. No. 22547) was cancelled by the Register of Deeds of Manila and in lieu thereof Transfer Certificate of Title No. 80876 was issued in the name of the Land Tenure Administration (now Land Authority) pursuant to the provisions of Republic Act No. 4118. 9

But due to reasons which do not appear in the record, the City of Manila made a complete turn-about, for on December 20, 1966, Antonio J. Villegas, in his capacity as the City Mayor of Manila and the City of Manila as a duly organized public corporation, brought an action for injunction and/or prohibition with preliminary injunction to restrain, prohibit and enjoin the herein appellants, particularly the Governor of the Land Authority and the Register of Deeds of Manila, from further implementing Republic Act No. 4118, and praying for the declaration of Republic Act No. 4118 as unconstitutional.

With the foregoing antecedent facts, which are all contained in the partial stipulation of facts submitted to the trial court and approved by respondent Judge, the parties waived the presentation of further evidence and submitted the case for decision. On September 23, 1968, judgment was rendered by the trial court declaring Republic Act No. 4118 unconstitutional and invalid on the ground that it deprived the City of Manila of its property without due process of law and payment of just compensation. The respondents were ordered to undo all that had been done to carry out the provisions of said Act and were restrained from further implementing the same.

Two issues are presented for determination, on the resolution of which the decision in this case hinges, to wit:

I. Is the property involved private or patrimonial property of the City of Manila?

II. Is Republic Act No. 4118 valid and not repugnant to the Constitution?

I.

As regards the first issue, appellants maintain that the land involved is a communal land or "legua comunal" which is a portion of the public domain owned by the State; that it came into existence as such when the City of Manila, or any pueblo or town in the Philippines for that matter, was founded under the laws of Spain, the former sovereign; that upon the establishment of a pueblo, the administrative

authority was required to allot and set aside portions of the public domain for a public plaza, a church site, a site for public buildings, lands to serve as common pastures and for streets and roads; that in assigning these lands some lots were earmarked for strictly public purposes, and ownership of these lots (for public purposes) immediately passed to the new municipality; that in the case of common lands or "legua comunal", there was no such immediate acquisition of ownership by the pueblo, and the land though administered thereby, did not automatically become its property in the absence of an express grant from the Central Government, and that the reason for this arrangement is that this class of land was not absolutely needed for the discharge of the municipality's governmental functions.

It is argued that the parcel of land involved herein has not been used by the City of Manila for any public purpose and had not been officially earmarked as a site for the erection of some public buildings; that this circumstance confirms the fact that it was originally "communal" land alloted to the City of Manila by the Central Government not because it was needed in connection with its organization as a municipality but simply for the common use of its inhabitants; that the present City of Manila as successor of the Ayuntamiento de Manila under the former Spanish sovereign merely enjoys the usufruct over said land, and its exercise of acts of ownership by selling parts thereof did not necessarily convert the land into a patrimonial property of the City of Manila nor divest the State of its paramount title.

Appellants further argue that a municipal corporation, like a city is a governmental agent of the State with authority to govern a limited portion of its territory or to administer purely local affairs in a given political subdivision, and the extent of its authority is strictly delimited by the grant of power conferred by the State; that Congress has the exclusive power to create, change or destroy municipal corporations; that even if We admit that legislative control over municipal corporations is not absolute and even if it is true that the City of Manila has a registered title over the property in question, the mere transfer of such land by an act of the legislature from one class of public land to another, without compensation, does not invade the vested rights of the City.

Appellants finally argue that Republic Act No. 4118 has treated the land involved as one reserved for communal use, and this classification is conclusive upon the courts; that if the City of Manila feels that this is wrong and its interests have been thereby prejudiced, the matter should be brought to the attention of Congress for correction; and that since Congress, in the exercise of its wide discretionary powers has seen fit to classify the land in question as communal, the Courts certainly owe it to a coordinate branch of the Government to respect such determination and should not interfere with the enforcement of the law.

Upon the other hand, appellees argue by simply quoting portions of the appealed decision of the trial court, which read thus:

The respondents (petitioners-appellants herein) contend, among other defenses, that the property in question is communal property. This contention is, however, disproved by Original Certificate of Title No. 4329 issued on August 21, 1920 in favor of the City of Manila after the land in question was registered in the City's favor. The Torrens Title expressly states that the City of Manila was the owner in 'fee simple' of the said land. Under Sec. 38 of the Land Registration Act, as amended, the decree of confirmation and registration in favor of the City of Manila ... shall be conclusive upon and against all persons including the Insular Government and all the branches there ... There is nothing in the said certificate of title indicating that the land was 'communal' land as contended by the respondents. The erroneous assumption by the Municipal Board of

24

Manila that the land in question was communal land did not make it so. The Municipal Board had no authority to do that.

The respondents, however, contend that Congress had the power and authority to declare that the land in question was 'communal' land and the courts have no power or authority to make a contrary finding. This contention is not entirely correct or accurate. Congress has the power to classify 'land of the public domain', transfer them from one classification to another and declare them disposable or not. Such power does not, however, extend to properties which are owned by cities, provinces and municipalities in their 'patrimonial' capacity.

Art. 324 of the Civil Code provides that properties of provinces, cities and municipalities are divided into properties for public use and patrimonial property. Art. 424 of the same code provides that properties for public use consist of provincial roads, city streets, municipal streets, the squares, fountains, public waters, promenades and public works for public service paid for by said province, cities or municipalities. All other property possessed by any of them is patrimonial. Tested by this criterion the Court finds and holds that the land in question is patrimonial property of the City of Manila.

Respondents contend that Congress has declared the land in question to be 'communal' and, therefore, such designation is conclusive upon the courts. The Courts holds otherwise. When a statute is assailed as unconstitutional the Courts have the power and authority to inquire into the question and pass upon it. This has long ago been settled in Marbury vs. Madison, 2 L. ed. 60, when the United States Supreme Court speaking thru Chief Justice Marshall held:

... If an act of the legislature, repugnant to the constitution, is void, does it, notwithstanding its validity, bind the courts, and oblige them to give effect? It is emphatically the province and duty of the judicial department to say what the law is ... So if a law be in opposition to the constitution; if both the law and the constitution apply to a particular case, so that the court must either decide that case conformable to the constitution, disregarding the law, the court must determine which of these conflicting rules governs the case. This is of the very essence of

unconstitutional judicial duty.

Appellees finally concluded that when the courts declare a law unconstitutional it does not mean that the judicial power is superior to the legislative power. It simply means that the power of the people is superior to both and that when the will of the legislature, declared in statutes, stands in opposition to that of the people, declared in the Constitution, the judges ought to be governed by the Constitution rather than by the statutes.

There is one outstanding factor that should be borne in mind in resolving the character of the land involved, and it is that the City of Manila, although declared by the Cadastral Court as owner in fee simple, has not shown by any shred of evidence in what manner it acquired said land as its private or patrimonial property. It is true that the City of Manila as well as its predecessor, the Ayuntamiento de Manila, could validly acquire property in its corporate or private capacity, following the accepted doctrine on the dual character — public and private — of a municipal corporation. And when it acquires property in its private capacity, it acts like an ordinary person capable of entering into contracts or making transactions for the transmission of title or other real rights. When it comes to acquisition of land, it must have done so under any of the modes established by law for the acquisition of ownership and other real rights. In the absence of a title deed to any land claimed by the City of Manila as its own, showing that it was acquired with its private or corporate funds, the presumption is that such land came from the State upon the creation of the municipality (Unson vs. Lacson, et al., 100 Phil. 695). Originally the municipality owned no patrimonial property except those that were granted by the State not for its public but for private use. Other properties it owns are acquired in the course of the exercise of its corporate powers as a juridical entity to which category a municipal corporation pertains.

Communal lands or "legua comunal" came into existence when a town or pueblo was established in this country under the laws of Spain (Law VII, Title III, Book VI, Recopilacion de las Leyes de Indios). The municipalities of the Philippines were not entitled, as a matter of right, to any part of the public domain for use as communal lands. The Spanish law provided that the usufruct of a portion of the public domain adjoining municipal territory might be granted by the Government for communal purposes, upon proper petition, but, until granted, no rights therein passed to the municipalities, and, in any event, the ultimate title remained in the sovereign (City of Manila vs. Insular Government, 10 Phil. 327).

For the establishment, then, of new pueblos the administrative authority of the province, in representation of the Governor General, designated the territory for their location and extension and the metes and bounds of the same; and before alloting the lands among the new settlers, a special demarcation was made of the places which were to serve as the public square of the pueblo, for the erection of the church, and as sites for the public buildings, among others, the municipal building or the casa real, as well as of the lands whick were to constitute the common pastures, and propios of the municipality and the streets and roads which were to intersect the new town were laid out, ... . (Municipality of Catbalogan vs. Director of Lands, 17 Phil. 216, 220) (Emphasis supplied)

It may, therefore, be laid down as a general rule that regardless of the source or classification of land in the possession of a municipality, excepting those acquired with its own funds in its private or corporate capacity, such property is held in trust for the State for the benefit of its inhabitants, whether it be for governmental or proprietary purposes. It holds such lands subject to the paramount power of the legislature to dispose of the same, for after all it

25

owes its creation to it as an agent for the performance of a part of its public work, the municipality being but a subdivision or instrumentality thereof for purposes of local administration. Accordingly, the legal situation is the same as if the State itself holds the property and puts it to a different use (2 McQuilin,Municipal Corporations, 3rd Ed., p. 197, citing Monagham vs. Armatage, 218 Minn. 27, 15 N. W. 2nd 241).

True it is that the legislative control over a municipal corporation is not absolute even when it comes to its property devoted to public use, for such control must not be exercised to the extent of depriving persons of their property or rights without due process of law, or in a manner impairing the obligations of contracts. Nevertheless, when it comes to property of the municipality which it did not acquire in its private or corporate capacity with its own funds, the legislature can transfer its administration and disposition to an agency of the National Government to be disposed of according to its discretion. Here it did so in obedience to the constitutional mandate of promoting social justice to insure the well-being and economic security of the people.

It has been held that a statute authorizing the transfer of a Municipal airport to an Airport Commission created by the legislature, even without compensation to the city, was not violative of the due process clause of the American Federal Constitution. The Supreme Court of Minnessota in Monagham vs. Armatage, supra, said:

... The case is controlled by the further rule that the legislature, having plenary control of the local municipality, of its creation and of all its affairs, has the right to authorize or direct the expenditures of money in its treasury, though raised, for a particular purpose, for any legitimate municipal purpose, or to order and direct a distribution thereof upon a division of the territory into separate municipalities ... . The local municipality has no such vested right in or to its public funds, like that which the Constitution protects in the individual as precludes legislative interferences. People vs. Power, 25 Ill. 187; State Board (of Education) vs. City, 56 Miss. 518. As remarked by the supreme court of Maryland in Mayor vs. Sehner, 37 Md. 180: "It is of the essence of such a corporation, that the government has the sole right as trustee of the public interest, at its own good will and pleasure, to inspect, regulate, control, and direct the corporation, its funds, and franchises."

We therefore hold that c.500, in authorizing the transfer of the use and possession of the municipal airport to the commission without compensation to the city or to the park board, does not violate the Fourteenth Amendment to the Constitution of the United States.

The Congress has dealt with the land involved as one reserved for communal use (terreno comunal). The act of classifying State property calls for the exercise of wide discretionary legislative power and it should not be interfered with by the courts.

This brings Us to the second question as regards the validity of Republic Act No. 4118, viewed in the light of Article III, Sections 1, subsection (1) and (2) of the Constitution which ordain that no person shall be deprived of his property without due process of law and that no private property shall be taken for public use without just compensation.

II .

The trial court declared Republic Act No. 4118 unconstitutional for allegedly depriving the City of Manila of its property without due process of law and without payment of just compensation. It is now well established that the presumption is always in favor of the constitutionality of a law (U S. vs. Ten Yu, 24 Phil. 1; Go Ching, et al. vs. Dinglasan, et al., 45 O.G. No. 2, pp. 703, 705). To declare a law unconstitutional, the repugnancy of that law to the Constitution must be clear and unequivocal, for even if a law is aimed at the attainment of some public good, no infringement of constitutional rights is allowed. To strike down a law there must be a clear showing that what the fundamental law condemns or prohibits, the statute allows it to be done (Morfe vs. Mutuc, et al., G.R. No. L-20387, Jan. 31, 1968; 22 SCRA 424). That situation does not obtain in this case as the law assailed does not in any manner trench upon the constitution as will hereafter be shown. Republic Act No. 4118 was intended to implement the social justice policy of the Constitution and the Government program of "Land for the Landless". The explanatory note of House Bill No. 1453 which became Republic Act No. 4118, reads in part as follows:

Approval of this bill will implement the policy of the administration of "land for the landless" and the Fifth Declaration of Principles of the Constitution which states that "the promotion of social justice to insure the well-being and economic security of all people should be the concern of the State." We are ready and willing to enact legislation promoting the social and economic well-being of the people whenever an opportunity for enacting such kind of legislation arises.

The respondent Court held that Republic Act No. 4118, "by converting the land in question — which is the patrimonial property of the City of Manila into disposable alienable land of the State and placing it under the disposal of the Land Tenure Administration — violates the provisions of Article III (Secs. 1 and 2) of the Constitution which ordain that "private property shall not be taken for public use without just compensation, and that no person shall be deprived of life, liberty or property without due process of law". In support thereof reliance is placed on the ruling in Province of Zamboanga del Norte vs. City of Zamboanga, G.R. No. 2440, March 28, 1968; 22 SCRA 1334, which holds that Congress cannot deprive a municipality of its private or patrimonial property without due process of law and without payment of just compensation since it has no absolute control thereof. There is no quarrel over this rule if it is undisputed that the property sought to be taken is in reality a private or patrimonial property of the municipality or city. But it would be simply begging the question to classify the land in question as such. The property, as has been previously shown, was not acquired by the City of Manila with its own funds in its private or proprietary capacity. That it has in its name a registered title is not questioned, but this title should be deemed to be held in trust for the State as the land covered thereby was part of the territory of the City of Manila granted by the sovereign upon its creation. That the National Government, through the Director of Lands, represented by the Solicitor General, in the cadastral proceedings did not contest the claim of the City of Manila that the land is its property, does not detract from its character as State property and in no way divests the legislature of its power to deal with it as such, the state not being bound by the mistakes and/or negligence of its officers.

One decisive fact that should be noted is that the City of Manila expressly recognized the paramount title of the State over said land when by its resolution of September 20, 1960, the Municipal Board, presided by then Vice-Mayor Antonio Villegas, requested "His Excellency the President of the Philippines to consider the feasibility of declaring the city property bounded by Florida, San Andres and Nebraska Streets, under Transfer Certificate of Title Nos. 25545 and 25547, containing an area of 7,450 square meters, as patrimonial property of the City of Manila for the purpose of reselling these lots to the actual occupants thereof." (See Annex E, Partial Stipulation of Facts, Civil Case No. 67945,

26

CFI, Manila, p. 121, Record of the Case) [Emphasis Supplied]

The alleged patrimonial character of the land under the ownership of the City of Manila is totally belied by the City's own official act, which is fatal to its claim since the Congress did not do as bidden. If it were its patrimonial property why should the City of Manila be requesting the President to make representation to the legislature to declare it as such so it can be disposed of in favor of the actual occupants? There could be no more blatant recognition of the fact that said land belongs to the State and was simply granted in usufruct to the City of Manila for municipal purposes. But since the City did not actually use said land for any recognized public purpose and allowed it to remain idle and unoccupied for a long time until it was overrun by squatters, no presumption of State grant of ownership in favor of the City of Manila may be acquiesced in to justify the claim that it is its own private or patrimonial property (Municipality of Tigbauan vs. Director of Lands, 35 Phil. 798; City of Manila vs. Insular Government, 10 Phil. 327; Municipality of Luzuriaga vs. Director of Lands, 24 Phil. 193). The conclusion of the respondent court that Republic Act No. 4118 converted a patrimonial property of the City of Manila into a parcel of disposable land of the State and took it away from the City without compensation is, therefore, unfounded. In the last analysis the land in question pertains to the State and the City of Manila merely acted as trustee for the benefit of the people therein for whom the State can legislate in the exercise of its legitimate powers.

Republic Act No. 4118 was never intended to expropriate the property involved but merely to confirm its character as communal land of the State and to make it available for disposition by the National Government: And this was done at the instance or upon the request of the City of Manila itself. The subdivision of the land and conveyance of the resulting subdivision lots to the occupants by Congressional authorization does not operate as an exercise of the power of eminent domain without just compensation in violation of Section 1, subsection (2), Article III of the Constitution, but simply as a manifestation of its right and power to deal with state property.

It should be emphasized that the law assailed was enacted upon formal written petition of the Municipal Board of Manila in the form of a legally approved resolution. The certificate of title over the property in the name of the City of Manila was accordingly cancelled and another issued to the Land Tenure Administration after the voluntary surrender of the City's duplicate certificate of title by the City Treasurer with the knowledge and consent of the City Mayor. To implement the provisions of Republic Act No. 4118, the then Deputy Governor of the Land Authority sent a letter, dated February 18, 1965, to the City Mayor furnishing him with a copy of the "proposed subdivision plan of the said lot as prepared for the Republic of the Philippines for subdivision and resale by the Land Authority to bona fide applicants." On March 2, 1965, the Mayor of Manila, through his Executive and Technical Adviser, acknowledged receipt of the subdivision plan and informed the Land Authority that his Office "will interpose no objection to the implementation of said law provided that its provisions are strictly complied with." The foregoing sequence of events, clearly indicate a pattern of regularity and observance of due process in the reversion of the property to the National Government. All such acts were done in recognition by the City of Manila of the right and power of the Congress to dispose of the land involved.

Consequently, the City of Manila was not deprived of anything it owns, either under the due process clause or under the eminent domain provisions of the Constitution. If it failed to get from the Congress the concession it sought of having the land involved given to it as its patrimonial property, the Courts possess no power to grant that relief. Republic Act No. 4118 does not, therefore, suffer from any constitutional infirmity.

WHEREFORE, the appealed decision is hereby reversed, and petitioners shall proceed with the free and untrammeled implementation of Republic Act No. 4118 without any obstacle from the respondents. Without costs.

DACANAY JR. V. ASISTIO JR.

208 SCRA 404

FACTS:

An ordinance was issued designated certain city and municipal streets, roads, and other public areas for sites of public markets. Pursuant to this, licenses were issued to market stall owners to put up their stalls in certain streets. Thereafter, the OIC mayor of Caloocan has caused the demolition of the stalls, which was upheld by the trial court, saying that the public streets are part of the public dominion and is not open to the commerce of man. Then there come about a change in administration of the city. The

next mayor did not continue the demolition of the stalls. Using the trial court’s decision, here now comes petitioner asking for the demolition of the stalls.

HELD:

There is no doubt that the disputed areas from which the private respondent’s market stalls are sought to be evicted are public streets. A public street is property for public use hence outside the commerce of man. Being outside the commerce of man, it may not be the subject of

lease or other contract.

The right of the public to use the city streets may not be bargained away through contract. The interests of the few should not prevail over the good of the greater number in the community.

G.R. No. 93654 May 6, 1992

FRANCISCO U. DACANAY, petitioner,

vs.

MAYOR MACARIO ASISTIO, JR., CITY ENGR. LUCIANO SARNE, JR. of Kalookan City, Metro Manila, MILA PASTRANA AND/OR RODOLFO TEOFE, STALLHOLDERS AND REPRESENTING CO-STALLHOLDERS, respondents.

David D. Advincula, Jr. for petitioner.

Juan P. Banaga for private respondents.

GRIÑO-AQUINO, J.:

May public streets or thoroughfares be leased or licensed to market stallholders by virtue of a city ordinance or resolution of the Metro Manila Commission? This issue is posed by the petitioner, an aggrieved Caloocan City resident who filed a special civil action of mandamus against the incumbent city mayor and city engineer, to compel these city officials to remove the market stalls from certain city streets which the aforementioned city officials have designated as flea markets, and the private respondents (stallholders) to vacate the streets.

On January 5, 1979, MMC Ordinance No. 79-02 was enacted by the Metropolitan Manila Commission, designating certain city and municipal streets, roads and open spaces as sites for flea markets. Pursuant, thereto, the Caloocan City mayor opened up seven (7) flea markets in that city. One of those streets was the "Heroes del '96"

27

where the petitioner lives. Upon application of vendors Rodolfo Teope, Mila Pastrana, Carmen Barbosa, Merle Castillo, Bienvenido Menes, Nancy Bugarin, Jose Manuel, Crisaldo Paguirigan, Alejandro Castron, Ruben Araneta, Juanita and Rafael Malibaran, and others, the respondents city mayor and city engineer, issued them licenses to conduct vending activities on said street.

In 1987, Antonio Martinez, as OIC city mayor of Caloocan City, caused the demolition of the market stalls on Heroes del '96, V. Gozon and Gonzales streets. To stop Mayor Martinez' efforts to clear the city streets, Rodolfo Teope, Mila Pastrana and other stallowners filed an action for prohibition against the City of Caloocan, the OIC City Mayor and the City Engineer and/or their deputies (Civil Case No. C-12921) in the Regional Trial Court of Caloocan City, Branch 122, praying the court to issue a writ of preliminary injunction ordering these city officials to discontinue the demolition of their stalls during the pendency of the action.

The court issued the writ prayed for. However, on December 20, 1987, it dismissed the petition and lifted the writ of preliminary injunction which it had earlier issued. The trial court observed that:

A perusal of Ordinance 2, series of 1979 of the Metropolitan Manila Commission will show on the title itself that it is an ordinance ––

Authorizing and regulating the use of certain city and/or municipal streets, roads and open spaces within Metropolitan Manila as sites for flea market and/or vending areas, under certain terms and conditions, subject to the approval of the Metropolitan Manila Commission, and for other purposes

which is further amplified in Section 2 of the said ordinance, quoted hereunder:

Sec. 2. The streets, roads and open spaces to be used as sites for flea markets (tiangge) or vending areas; the design, measurement or specification of the structures, equipment and apparatuses to be used or put up; the allowable distances; the days and time allowed for the conduct of the businesses and/or activities herein authorized; the rates or fees or charges to be imposed, levied and collected; the kinds of merchandise, goods and commodities sold and services rendered; and other matters and activities related to the establishment, maintenance and management and operation of flea markets and vending areas, shall be determined and prescribed by the mayors of the cities and municipalities in the Metropolitan Manila where the same are located, subject to the approval of the Metropolitan Manila Commission and consistent with the guidelines hereby prescribed.

Further, it is so provided in the guidelines under the said Ordinance No. 2 of the MMC that —

Sec. 6. In the establishment, operation, maintenance and management of flea markets and vending areas, the following guidelines, among others, shall be observed:

xxx xxx xxx

(m) That the permittee shall remove the equipment, facilities and other appurtenances used by him in the conduct of his business after the close or termination of business hours. (Emphasis ours; pp. 15-16, Rollo.)

The trial court found that Heroes del '96, Gozon and Gonzales streets are of public dominion, hence, outside the commerce of man:

The Heroes del '96 street, V. Gozon street and Gonzales street, being of public dominion must, therefore, be outside of the commerce of man. Considering the nature of the subject premises, the following jurisprudence co/principles are applicable on the matter:

1) They cannot be alienated or leased or otherwise be the subject matter of contracts. (Municipality of Cavite vs. Rojas, 30 Phil. 602);

2) They cannot be acquired by prescription against the state (Insular Government vs. Aldecoa, 19 Phil. 505). Even municipalities can not acquire them for use as communal lands against the state (City of Manila vs. Insular Government, 10 Phil. 327);

3) They are not subject to attachment and execution (Tan Toco vs. Municipal Council of Iloilo, 49 Phil. 52);

4) They cannot be burdened by any voluntary easement (2-II Colin & Capitant 520) (Tolentino, Civil Code of the Phils., Vol. II, 1983 Ed. pp. 29-30).

In the aforecited case of Municipality of Cavite vs. Rojas, it was held that properties for public use may not be leased to private individuals. Such a lease is null and void for the reason that a municipal council cannot withdraw part of the plaza from public use. If possession has already been given, the lessee must restore possession by vacating it and the municipality must thereupon restore to him any sums it may have collected as rent.

In the case of City of Manila vs. Gerardo Garcia, 19 SCRA 413, the Supreme Court held:

The property being a public one, the Manila Mayors did not have the authority to give permits, written or oral, to the squatters, and that the permits granted are therefore considered null and void.

This doctrine was reiterated in the case of Baguio Citizens Action Inc. vs. The City Council, 121 SCRA 368, where it was held that:

An ordinance legalizing the occupancy by squatters of public land is null and void.

The authority of respondent Municipality of Makati to demolish the shanties of the petitioner's members is mandated by

P.D. 772, and Sec. 1 of Letter of Instruction No. 19 orders certain public officials, one of whom is the Municipal Mayor to remove all illegal constructions including buildings on and along esteros and river banks, those along railroad tracks and those built without permits on public or private property (Zansibarian Residents Association vs. Mun. of Makati, 135 SCRA 235). The City Engineer is also among those required to comply with said Letter of Instruction.

The occupation and use of private individuals of sidewalks and other public places devoted for public use constitute both public and private nuisances and nuisance per se, and this applies to even case involving the use or lease of public places under permits and licenses issued by competent authority, upon the theory that such holders could not take advantage of their unlawful permits and license and claim that the land in question is a part of a public street or a public place devoted to public use, hence, beyond the commerce of man. (Padilla, Civil Code Annotated, Vol. II, p. 59, 6th Ed., citing Umali vs. Aquino, IC. A. Rep. 339.)

From the aforequoted jurisprudence/principles, the Court opines that defendants have the right to demolish the subject stalls of the plaintiffs, more so when Section 185, par. 4 of

28

Batas Pambansa Blg. 337, otherwise known as the Local Government Code provides that the City Engineer shall:

(4) . . .

(c) Prevent the encroachment of private buildings and fences on the streets and public places;

xxx xxx xxx

(j) Inspect and supervise the construction, repair, removal and safety of private buildings;

xxx xxx xxx

(k) With the previous approval of the City Mayor in each case, order the removal of materials employed in the construction or repair of any building or structures made in violation of law or ordinance, and cause buildings and structures dangerous to the public to made secure or torn down;

xxx xxx xxx

Further, the Charter of the City of Caloocan, Republic Act No. 5502, Art. VII, Sec. 27, par. g, 1 and m, grants the City Engineer similar powers. (Emphasis supplied; pp. 17-20, Rollo.)

However, shortly after the decision came out, the city administration in Caloocan City changed hands. City Mayor Macario Asistio, Jr., as successor of Mayor Martinez, did not pursue the latter's policy of clearing and cleaning up the city streets.

Invoking the trial court's decision in Civil Case No. C-12921, Francisco U. Dacanay, a concerned citizen, taxpayer and registered voter of Barangay 74, Zone 7, District II of Caloocan City, who resides on Heroes del '96 Street, one of the affected streets, wrote a letter dated March 7, 1988 to Mayor Asistio, Jr., calling his attention to the illegally-constructed stalls on Heroes del '96 Street and asked for their demolition.

Dacanay followed up that letter with another one dated April 7, 1988 addressed to the mayor and the city engineer, Luciano Sarne, Jr. (who replaced Engineer Arturo Samonte), inviting their attention to the Regional Trial Court's decision in Civil Case No. 12921. There was still no response.

Dacanay sought President Corazon C. Aquino's intervention by writing her a letter on the matter. His letter was referred to the city mayor for appropriate action. The acting Caloocan City secretary, Asuncion Manalo, in a letter dated August 1, 1988, informed the Presidential Staff Director that the city officials were still studying the issue of whether or not to proceed with the demolition of the market stalls.

Dacanay filed a complaint against Mayor Asistio and Engineer Sarne (OMB-0-89-0146) in the Office of the OMBUDSMAN. In their letter-comment dated April 3, 1989, said city officials explained that in view of the huge number of stallholders involved, not to mention their dependents, it would be harsh and inhuman to eject them from the area in question, for their relocation would not be an easy task.

In reply, Dacanay maintained that respondents have been derelict in the performance of their duties and through manifest partiality constituting a violation of Section 3(e) of R.A. 3019, have caused undue injury to the Government and given unwarranted benefits to the stallholders.

After conducting a preliminary investigation, the OMBUDSMAN rendered a final evaluation and report on August 28, 1989, finding that the respondents' inaction is

purely motivated by their perceived moral and social responsibility toward their constituents, but "the fact remains that there is an omission of an act which ought to be performed, in clear violation of Sections 3(e) and (f) of Republic Act 3019." (pp. 83-84, Rollo.) The OMBUDSMAN recommended the filing of the corresponding information in court.

As the stallholders continued to occupy Heroes del '96 Street, through the tolerance of the public respondents, and in clear violation of the decision it Civil Case No. C-12921, Dacanay filed the present petition for mandamus on June 19, 1990, praying that the public respondents be ordered to enforce the final decision in Civil Case No. C-12921 which upheld the city mayor's authority to order the demolition of market stalls on V. Gozon, Gonzales and Heroes del '96 Streets and to enforce P.D. No. 772 and other pertinent laws.

On August 16, 1990, the public respondents, through the City Legal Officer, filed their Comment' on the petition. The Office of the Solicitor General asked to be excused from filing a separate Comment in behalf of the public respondents. The City Legal Officer alleged that the vending area was transferred to Heroes del '96 Street to decongest Malonzo Street, which is comparatively a busier thoroughfare; that the transfer was made by virtue of Barangay Resolution No. 30 s'78 dated January 15, 1978; that while the resolution was awaiting approval by the Metropolitan Manila Commission, the latter passed Ordinance No. 79-2, authorizing the use of certain streets and open spaces as sites for flea markets and/or vending areas; that pursuant thereto, Acting MMC Mayor Virgilio P. Robles issued Executive Order No. 135 dated January 10, 1979, ordering the establishment and operation of flea markets in specified areas and created the Caloocan City Flea Market Authority as a regulatory body; and that among the sites chosen and approved by the Metro Manila Commission, Heroes del '96 Street has considered "most viable and progressive, lessening unemployment in the city and servicing the residents with affordable basic necessities."

The petition for mandamus is meritorious.

There is no doubt that the disputed areas from which the private respondents' market stalls are sought to be evicted are public streets, as found by the trial court in Civil Case No. C-12921. A public street is property for public use hence outside the commerce of man (Arts. 420, 424, Civil Code). Being outside the commerce of man, it may not be the subject of lease or other contract (Villanueva et al. vs. Castañeda and Macalino, 15 SCRA 142, citing the Municipality of Cavite vs. Rojas, 30 SCRA 602; Espiritu vs. Municipal Council of Pozorrubio, 102 Phil. 869; and Muyot vs. De la Fuente, 48 O.G. 4860).

As the stallholders pay fees to the City Government for the right to occupy portions of the public street, the City Government, contrary to law, has been leasing portions of the streets to them. Such leases or licenses are null and void for being contrary to law. The right of the public to use the city streets may not be bargained away through contract. The interests of a few should not prevail over the good of the greater number in the community whose health, peace, safety, good order and general welfare, the respondent city officials are under legal obligation to protect.

The Executive Order issued by Acting Mayor Robles authorizing the use of Heroes del '96 Street as a vending area for stallholders who were granted licenses by the city government contravenes the general law that reserves city streets and roads for public use. Mayor Robles' Executive Order may not infringe upon the vested right of the public to use city streets for the purpose they were intended to serve:

29

i.e., as arteries of travel for vehicles and pedestrians. As early as 1989, the public respondents bad started to look for feasible alternative sites for flea markets. They have had more than ample time to relocate the street vendors.

WHEREFORE, it having been established that the petitioner and the general public have a legal right to the relief demanded and that the public respondents have the corresponding duty, arising from public office, to clear the city streets and restore them to their specific public purpose (Enriquez vs. Bidin, 47 SCRA 183; City of Manila vs. Garcia et al., 19 SCRA, 413 citing Unson vs. Lacson, 100 Phil. 695), the respondents City Mayor and City Engineer of Caloocan City or their successors in office are hereby ordered to immediately enforce and implement the decision in Civil Case No. C-1292 declaring that Heroes del '96, V. Gozon, and Gonzales Streets are public streets for public use, and they are ordered to remove or demolish, or cause to be removed or demolished, the market stalls occupying said city streets with utmost dispatch within thirty (30)days from notice of this decision. This decision is immediately executory.

SO ORDERED.

G.R. No. L-24440             March 28, 1968

THE PROVINCE OF ZAMBOANGA DEL NORTE, plaintiff-appellee, vs.CITY OF ZAMBOANGA, SECRETARY OF FINANCE and COMMISSIONER OF INTERNAL REVENUE, defendants-appellants.

Fortugaleza, Lood, Sarmiento, M. T. Yap & Associates for plaintiff-appellee.Office of the Solicitor General for defendants-appellants.

BENGZON, J.P., J.:

          Prior to its incorporation as a chartered city, the Municipality of Zamboanga used to be the provincial capital of the then Zamboanga Province. On October 12, 1936, Commonwealth Act 39 was approved converting the Municipality of Zamboanga into Zamboanga City. Sec. 50 of the Act also provided that —

          Buildings and properties which the province shall abandon upon the transfer of the capital to another place will be acquired and paid for by the City of Zamboanga at a price to be fixed by the Auditor General.

          The properties and buildings referred to consisted of 50 lots and some buildings constructed thereon, located in the City of Zamboanga and covered individually by Torrens certificates of title in the name of Zamboanga Province. As

far as can be gleaned from the records, 1 said properties were being utilized as follows —

No. of Lots

Use

1 ................................................ Capitol Site3 ................................................ School Site

3................................................ Hospital Site

3 ................................................ Leprosarium

1................................................ Curuan School

1................................................ Trade School

2................................................ Burleigh School

2................................................ High School Playground

9 ................................................ Burleighs

1................................................ Hydro-Electric Site (Magay)

1 ................................................ San Roque23 ................................................ vacant

          It appears that in 1945, the capital of Zamboanga Province was transferred to Dipolog. 2 Subsequently, or on June 16, 1948, Republic Act 286 was approved creating the municipality of Molave and making it the capital of Zamboanga Province.

          On May 26, 1949, the Appraisal Committee formed by the Auditor General, pursuant to Commonwealth Act 39, fixed the value of the properties and buildings in question left by Zamboanga Province in Zamboanga City at P1,294,244.00. 3

          On June 6, 1952, Republic Act 711 was approved dividing the province of Zamboanga into two (2): Zamboanga del Norte and Zamboanga del Sur. As to how the assets and obligations of the old province were to be divided between the two new ones, Sec. 6 of that law provided:

Upon the approval of this Act, the funds, assets and other properties and the obligations of the province of Zamboanga shall be divided equitably between the Province of Zamboanga del Norte and the Province of Zamboanga del Sur by the President of the Philippines, upon the recommendation of the Auditor General.

          Pursuant thereto, the Auditor General, on January 11, 1955, apportioned the assets and obligations of the defunct Province of Zamboanga as follows: 54.39% for Zamboanga del Norte and 45.61% for Zamboanga del Sur. Zamboanga del Norte therefore became entitled to 54.39% of P1,294,244.00, the total value of the lots and buildings in question, or P704,220.05 payable by Zamboanga City.

          On March 17, 1959, the Executive Secretary, by order of the President, issued a ruling 4 holding that Zamboanga del Norte had a vested right as owner (should be co-owner pro-indiviso) of the properties mentioned in Sec. 50 of Commonwealth Act 39, and is entitled to the price thereof, payable by Zamboanga City. This ruling revoked the previous Cabinet Resolution of July 13, 1951 conveying all the said 50 lots and buildings thereon to Zamboanga City for P1.00, effective as of 1945, when the provincial capital of the then Zamboanga Province was transferred to Dipolog.

          The Secretary of Finance then authorized the Commissioner of Internal Revenue to deduct an amount equal to 25% of the regular internal revenue allotment for the City of Zamboanga for the quarter ending March 31, 1960, then for the quarter ending June 30, 1960, and again for the first quarter of the fiscal year 1960-1961. The deductions, all aggregating P57,373.46, was credited to the province of Zamboanga del Norte, in partial payment of the P764,220.05 due it.

          However, on June 17, 1961, Republic Act 3039 was approved amending Sec. 50 of Commonwealth Act 39 by providing that —

          All buildings, properties and assets belonging to the former province of Zamboanga and located within the City of Zamboanga are hereby transferred, free of charge, in favor of the said City of Zamboanga. (Stressed for emphasis).

          Consequently, the Secretary of Finance, on July 12, 1961, ordered the Commissioner of Internal Revenue to stop from effecting further payments to Zamboanga del Norte and to return to Zamboanga City the sum of P57,373.46 taken from it out of the internal revenue allotment of Zamboanga del Norte. Zamboanga City admits that since the enactment of Republic Act 3039, P43,030.11 of the P57,373.46 has already been returned to it.

30

          This constrained plaintiff-appellee Zamboanga del Norte to file on March 5, 1962, a complaint entitled "Declaratory Relief with Preliminary Mandatory Injunction" in the Court of First Instance of Zamboanga del Norte against defendants-appellants Zamboanga City, the Secretary of Finance and the Commissioner of Internal Revenue. It was prayed that: (a) Republic Act 3039 be declared unconstitutional for depriving plaintiff province of property without due process and just compensation; (b) Plaintiff's rights and obligations under said law be declared; (c) The Secretary of Finance and the Internal Revenue Commissioner be enjoined from reimbursing the sum of P57,373.46 to defendant City; and (d) The latter be ordered to continue paying the balance of P704,220.05 in quarterly installments of 25% of its internal revenue allotments.

          On June 4, 1962, the lower court ordered the issuance of preliminary injunction as prayed for. After defendants filed their respective answers, trial was held. On August 12, 1963, judgment was rendered, the dispositive portion of which reads:

          WHEREFORE, judgment is hereby rendered declaring Republic Act No. 3039 unconstitutional insofar as it deprives plaintiff Zamboanga del Norte of its private properties, consisting of 50 parcels of land and the improvements thereon under certificates of title (Exhibits "A" to "A-49") in the name of the defunct province of Zamboanga; ordering defendant City of Zamboanga to pay to the plaintiff the sum of P704,220.05 payment thereof to be deducted from its regular quarterly internal revenue allotment equivalent to 25% thereof every quarter until said amount shall have been fully paid; ordering defendant Secretary of Finance to direct defendant Commissioner of Internal Revenue to deduct 25% from the regular quarterly internal revenue allotment for defendant City of Zamboanga and to remit the same to plaintiff Zamboanga del Norte until said sum of P704,220.05 shall have been fully paid; ordering plaintiff Zamboanga del Norte to execute through its proper officials the corresponding public instrument deeding to defendant City of Zamboanga the 50 parcels of land and the improvements thereon under the certificates of title (Exhibits "A" to "A-49") upon payment by the latter of the aforesaid sum of P704,220.05 in full; dismissing the counterclaim of defendant City of Zamboanga; and declaring permanent the preliminary mandatory injunction issued on June 8, 1962, pursuant to the order of the Court dated June 4, 1962. No costs are assessed against the defendants.

          It is SO ORDERED.

          Subsequently, but prior to the perfection of defendants' appeal, plaintiff province filed a motion to reconsider praying that Zamboanga City be ordered instead to pay the P704,220.05 in lump sum with 6% interest per annum. Over defendants' opposition, the lower court granted plaintiff province's motion.

          The defendants then brought the case before Us on appeal.

          Brushing aside the procedural point concerning the property of declaratory relief filed in the lower court on the assertion that the law had already been violated and that plaintiff sought to give it coercive effect, since assuming the same to be true, the Rules anyway authorize the conversion of the proceedings to an ordinary action, 5 We proceed to the

more important and principal question of the validity of Republic Act 3039.

          The validity of the law ultimately depends on the nature of the 50 lots and buildings thereon in question. For, the matter involved here is the extent of legislative control over the properties of a municipal corporation, of which a province is one. The principle itself is simple: If the property is owned by the municipality (meaning municipal corporation) in its public and governmental capacity, the property is public and Congress has absolute control over it. But if the property is owned in its private or proprietary capacity, then it is patrimonial and Congress has no absolute control. The municipality cannot be deprived of it without due process and payment of just compensation. 6

          The capacity in which the property is held is, however, dependent on the use to which it is intended and devoted. Now, which of two norms, i.e., that of the Civil Code or that obtaining under the law of Municipal Corporations, must be used in classifying the properties in question?

          The Civil Code classification is embodied in its Arts. 423 and 424 which provide:1äwphï1.ñët

          ART. 423. The property of provinces, cities, and municipalities is divided into property for public use and patrimonial property.

          ART. 424. Property for public use, in the provinces, cities, and municipalities, consists of the provincial roads, city streets, municipal streets, the squares, fountains, public waters, promenades, and public works for public service paid for by said provinces, cities, or municipalities.

All other property possessed by any of them is patrimonial and shall be governed by this Code, without prejudice to the provisions of special laws. (Stressed for emphasis).

          Applying the above cited norm, all the properties in question, except the two (2) lots used as High School playgrounds, could be considered as patrimonial properties of the former Zamboanga province. Even the capital site, the hospital and leprosarium sites, and the school sites will be considered patrimonial for they are not for public use. They would fall under the phrase "public works for public service" for it has been held that under the ejusdem generis rule, such public works must be for free and indiscriminate use by anyone, just like the preceding enumerated properties in the first paragraph of Art 424. 7 The playgrounds, however, would fit into this category.

          This was the norm applied by the lower court. And it cannot be said that its actuation was without jurisprudential precedent for in Municipality of Catbalogan v. Director of Lands, 8 and in Municipality of Tacloban v. Director of Lands,

9 it was held that the capitol site and the school sites in municipalities constitute their patrimonial properties. This result is understandable because, unlike in the classification regarding State properties, properties for public service in the municipalities are not classified as public. Assuming then the Civil Code classification to be the chosen norm, the lower court must be affirmed except with regard to the two (2) lots used as playgrounds.

          On the other hand, applying the norm obtaining under the principles constituting the law of Municipal Corporations, all those of the 50 properties in question which are devoted to public service are deemed public; the rest remain patrimonial. Under this norm, to be considered public, it is enough that the property be held and, devoted for governmental purposes like local administration, public education, public health, etc. 10

31

          Supporting jurisprudence are found in the following cases: (1) HINUNANGAN V. DIRECTOR OF LANDS, 11 where it was stated that "... where the municipality has occupied lands distinctly for public purposes, such as for the municipal court house, the public school, the public market, or other necessary municipal building, we will, in the absence of proof to the contrary, presume a grant from the States in favor of the municipality; but, as indicated by the wording, that rule may be invoked only as to property which is used distinctly for public purposes...." (2) VIUDA DE TANTOCO V. MUNICIPAL COUNCIL OF ILOILO 12 held that municipal properties necessary for governmental purposes are public in nature. Thus, the auto trucks used by the municipality for street sprinkling, the police patrol automobile, police stations and concrete structures with the corresponding lots used as markets were declared exempt from execution and attachment since they were not patrimonial properties. (3) MUNICIPALITY OF BATANGAS VS. CANTOS 13 held squarely that a municipal lot which had always been devoted to school purposes is one dedicated to public use and is not patrimonial property of a municipality.

          Following this classification, Republic Act 3039 is valid insofar as it affects the lots used as capitol site, school sites and its grounds, hospital and leprosarium sites and the high school playground sites — a total of 24 lots — since these were held by the former Zamboanga province in its governmental capacity and therefore are subject to the absolute control of Congress. Said lots considered as public property are the following:

          We noticed that the eight Burleigh lots above described are adjoining each other and in turn are between the two lots wherein the Burleigh schools are built, as per records appearing herein and in the Bureau of Lands. Hence, there is sufficient basis for holding that said eight lots constitute the appurtenant grounds of the Burleigh schools, and partake of the nature of the same.

          Regarding the several buildings existing on the lots above-mentioned, the records do not disclose whether they were constructed at the expense of the former Province of Zamboanga. Considering however the fact that said buildings must have been erected even before 1936 when Commonwealth Act 39 was enacted and the further fact that provinces then had no power to authorize construction of buildings such as those in the case at bar at their own expense, 14 it can be assumed that said buildings were erected by the National Government, using national funds. Hence, Congress could very well dispose of said buildings in the same manner that it did with the lots in question.

          But even assuming that provincial funds were used, still the buildings constitute mere accessories to the lands, which are public in nature, and so, they follow the nature of said lands, i.e., public. Moreover, said buildings, though located in the city, will not be for the exclusive use and benefit of city residents for they could be availed of also by the provincial residents. The province then — and its successors-in-interest — are not really deprived of the benefits thereof.

          But Republic Act 3039 cannot be applied to deprive Zamboanga del Norte of its share in the value of the rest of the 26 remaining lots which are patrimonial properties since they are not being utilized for distinctly, governmental purposes. Said lots are:

          Moreover, the fact that these 26 lots are registered strengthens the proposition that they are truly private in nature. On the other hand, that the 24 lots used for governmental purposes are also registered is of no significance since registration cannot convert public property to private. 16

          We are more inclined to uphold this latter view. The controversy here is more along the domains of the Law of Municipal Corporations — State vs. Province — than along that of Civil Law. Moreover, this Court is not inclined to hold that municipal property held and devoted to public service is in the same category as ordinary private property. The consequences are dire. As ordinary private properties, they

can be levied upon and attached. They can even be acquired thru adverse possession — all these to the detriment of the local community. Lastly, the classification of properties other than those for public use in the municipalities as patrimonial under Art. 424 of the Civil Code — is "... without prejudice to the provisions of special laws." For purpose of this article, the principles, obtaining under the Law of Municipal Corporations can be considered as "special laws". Hence, the classification of municipal property devoted for distinctly governmental purposes as public should prevail over the Civil Code classification in this particular case.

          Defendants' claim that plaintiff and its predecessor-in-interest are "guilty of laches is without merit. Under Commonwealth Act 39, Sec. 50, the cause of action in favor of the defunct Zamboanga Province arose only in 1949 after the Auditor General fixed the value of the properties in question. While in 1951, the Cabinet resolved transfer said properties practically for free to Zamboanga City, a reconsideration thereof was seasonably sought. In 1952, the old province was dissolved. As successor-in-interest to more than half of the properties involved, Zamboanga del Norte was able to get a reconsideration of the Cabinet Resolution in 1959. In fact, partial payments were effected subsequently and it was only after the passage of Republic Act 3039 in 1961 that the present controversy arose. Plaintiff brought suit in 1962. All the foregoing, negative laches.

          It results then that Zamboanga del Norte is still entitled to collect from the City of Zamboanga the former's 54.39% share in the 26 properties which are patrimonial in nature, said share to computed on the basis of the valuation of said 26 properties as contained in Resolution No. 7, dated March 26, 1949, of the Appraisal Committee formed by the Auditor General.

          Plaintiff's share, however, cannot be paid in lump sum, except as to the P43,030.11 already returned to defendant City. The return of said amount to defendant was without legal basis. Republic Act 3039 took effect only on June 17, 1961 after a partial payment of P57,373.46 had already been made. Since the law did not provide for retroactivity, it could not have validly affected a completed act. Hence, the amount of P43,030.11 should be immediately returned by defendant City to plaintiff province. The remaining balance, if any, in the amount of plaintiff's 54.39% share in the 26 lots should then be paid by defendant City in the same manner originally adopted by the Secretary of Finance and the Commissioner of Internal Revenue, and not in lump sum. Plaintiff's prayer, particularly pars. 5 and 6, read together with pars. 10 and 11 of the first cause of action recited in the complaint 17 clearly shows that the relief sought was merely the continuance of the quarterly payments from the internal revenue allotments of defendant City. Art. 1169 of the Civil Code on reciprocal obligations invoked by plaintiff to justify lump sum payment is inapplicable since there has been so far in legal contemplation no complete delivery of the lots in question. The titles to the registered lots are not yet in the name of defendant Zamboanga City.

          WHEREFORE, the decision appealed from is hereby set aside and another judgment is hereby entered as follows:.

          (1) Defendant Zamboanga City is hereby ordered to return to plaintiff Zamboanga del Norte in lump sum the amount of P43,030.11 which the former took back from the latter out of the sum of P57,373.46 previously paid to the latter; and

          (2) Defendants are hereby ordered to effect payments in favor of plaintiff of whatever balance remains of plaintiff's 54.39% share in the 26 patrimonial properties, after deducting therefrom the sum of P57,373.46, on the basis of Resolution No. 7 dated March 26, 1949 of the Appraisal Committee formed by the Auditor General, by way of quarterly payments from the allotments of defendant City, in the manner originally adopted by the Secretary of Finance and the Commissioner of Internal Revenue. No costs. So ordered.

32

G.R. No. L-12958             May 30, 1960

FAUSTINO IGNACIO, applicant-appellant, vs.THE DIRECTOR OF LANDS and LAUREANO VALERIANO, oppositors-appellees.

Acting Assistant Solicitor General Pacifico P. de Castro and Solicitor Crispin V. Bautista for appellee Director of Lands.Benjamin H. Aquino for appellee Laureano Veleriano.

MONTEMAYOR, J.:

Faustino Ignacio is appealing the decision of the Court of First Instance of Rizal, dismissing his application for the registration of a parcel of land.

On January 25, 1950, Ignacio filed an application for the registration of a parcel of land (mangrove), situated in barrio Gasac, Navotas, Rizal, with an area of 37,877 square meters. Later, he amended his application by alleging among others that he owned the parcel applied for by right of accretion. To the application, the Director of Lands, Laureano Valeriano and Domingo Gutierrez filed oppositions. Gutierrez later withdrew his opposition. The Director of Lands claimed the parcel applied for as a portion of the public domain, for the reason that neither the applicant nor his predecessor-in-interest possessed sufficient title thereto, not having acquired it either by composition title from the Spanish government or by possessory information title under the Royal Decree of February 13, 1894, and that he had not possessed the same openly, continuously and adversely under a bona fide claim of ownership since July 26, 1894. In his turn, Valeriano alleged he was holding the land by virtue of a permit granted him by the Bureau of Fisheries, issued on January 13, 1947, and approved by the President.

It is not disputed that the land applied for adjoins a parcel owned by the applicant which he had acquired from the Government by virtue of a free patent title in 1936. It has also been established that the parcel in question was formed by accretion and alluvial deposits caused by the action of the Manila Bay which boarders it on the southwest. Applicant Ignacio claims that he had occupied the land since 1935, planting it with api-api trees, and that his possession thereof had been continuous, adverse and public for a period of twenty years until said possession was distributed by oppositor Valeriano.

On the other hand, the Director of Lands sought to prove that the parcel is foreshore land, covered by the ebb and flow of the tide and, therefore, formed part of the public domain.

After hearing, the trial court dismissed the application, holding that the parcel formed part of the public domain. In his appeal, Ignacio assigns the following errors:

I. The lower court erred in holding that the land in question, altho an accretion to the land of the applicant-appellant, does not belong to him but forms part of the public domain.

II. Granting that the land in question forms part of the public domain, the lower court nevertheless erred in not declaring the same to be the necessary for any public use or purpose and in not ordering in the present registration proceedings.

III. The lower court erred in not holding that the land in question now belongs to the applicant-appellant by virtue of acquisitive prescription, the said land having ceased to be of the public domain and became the private or patrimonial property of the State.

IV. The lower court erred in not holding that the oppositor Director of Lands is now in estoppel

from claiming the land in question as a land of the public domain.

Appellant contends that the parcel belongs to him by the law of accretion, having been formed by gradual deposit by action of the Manila Bay, and he cites Article 457 of the New Civil Code (Article 366, Old Civil Code), which provides that:

To the owners of lands adjoining the banks of rivers belong the accretion which they gradually receive from the effects of the current of the waters.

The article cited is clearly inapplicable because it refers to accretion or deposits on the banks of rivers, while the accretion in the present case was caused by action of the Manila Bay.

Appellant next contends that Articles 1, 4 and 5 of the Law of Waters are not applicable because they refer to accretions formed by the sea, and that Manila Bay cannot be considered as a sea. We find said contention untenable. A bay is a part of the sea, being a mere indentation of the same:

Bay. — An opening into the land where the water is shut in on all sides except at the entrance; an inlet of the sea; an arm of the sea, distinct from a river, a bending or curbing of the shore of the sea or of a lake. 7 C.J. 1013-1014 (Cited in Francisco, Philippine Law of Waters and Water Rights p. 6)

Moreover, this Tribunal has some cases applied the Law of Waters on Lands bordering Manila Bay. (See the cases of Ker & Co. vs. Cauden, 6 Phil., 732, involving a parcel of land bounded on the sides by Manila Bay, where it was held that such land formed by the action of the sea is property of the State; Francisco vs. Government of the P.I., 28 Phil., 505, involving a land claimed by a private person and subject to the ebb and flow of the tides of the Manila Bay).

Then the applicant argues that granting that the land in question formed part of the public domain, having been gained from the sea, the trial court should have declared the same no longer necessary for any public use or purpose, and therefore, became disposable and available for private ownership. Article 4 of the Law of Waters of 1866 reads thus:

ART. 4. Lands added to the shores by accretions and alluvial deposits caused by the action of the sea, form part of the public domain. When they are no longer washed by the waters of the sea and are not necessary for purposes of public utility, or for the establishment of special industries, or for the coastguard service, the Government shall declare them to be the property of the owners of the estates adjacent thereto and as increment thereof.

Interpreting Article 4 of the Law of Waters of 1866, in the case of Natividad vs. Director of Lands, (CA) 37 Off. Gaz., 2905, it was there held that:

Article 4 of the Law of Waters of 1866 provides that when a portion of the shore is no longer washed by the waters of the sea and is not necessary for purposes of public utility, or for the establishment of special industries, or for coastguard service, the government shall declare it to be the property of the owners of the estates adjacent thereto and as an increment thereof. We believe that only the executive and possibly the legislative departments have the authority and the power to make the declaration that any land so gained by the sea, is not necessary for purposes of public utility, or for the establishment of special industries, on for coast-guard service. If no such declaration has been made by said departments, the lot in question forms part of the public domain. (Natividad vs. Director of Lands, supra.)

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The reason for this pronouncement, according to this Tribunal in the case of Vicente Joven y Monteverde vs. Director of Lands, 93 Phil., 134, (cited in Velayo's Digest, VI. I, p. 52).

. . . is undoubtedly that the courts are neither primarily called upon, nor indeed in a position to determine whether any public land are to be used for the purposes specified in Article 4 of the Law of Waters.

Consequently, until a formal declaration on the part of the Government, through the executive department or the Legislature, to the effect that the land in question is no longer needed for coast guard service, for public use or for special industries, they continue to be part of the public domain, not available for private appropriation or ownership.

Appellant next contends that he had acquired the parcel in question through acquisitive prescription, having possessed the same for over ten years. In answer, suffice it to say that land of the public domain is not subject to ordinary prescription. In the case of Insular Government vs. Aldecoa & Co., 19 Phil., 505 this Court said:

The occupation or material possession of any land formed upon the shore by accretion, without previous permission from the proper authorities, although the occupant may have held the same as owner for seventeen years and constructed a wharf on the land, is illegal and is a mere detainer, inasmuch as such land is outside of the sphere of commerce; it pertains to the national domain; it is intended for public uses and for the benefit of those who live nearby.

We deem it unnecessary to discuss the other points raised in the appeal.

In view of the foregoing, the appealed decision is hereby affirmed, with costs.

LAUREL V. GARCIA

187 SCRA 797

FACTS:

The subject Roppongi property is one of the properties acquired by the Philippines from Japan pursuant to a Reparations Agreement. The property is where the Philippine Embassy was once located, before it transferred to the Nampeidai property. It was decided that the properties would be

available to sale or disposition. One of the first properties opened up for public auction was the Roppongi property, despite numerous oppositions from different sectors.

HELD:

The Roppongi property was acquired together with the other properties through reparation agreements. They were assigned to the government sector and that the Roppongi property was specifically designated under the agreement to house the Philippine embassy.

It is of public dominion unless it is convincingly shown that the property has become patrimonial. The respondents have failed to do so.

As property of public dominion, the Roppongi lot is outside the commerce of man. It cannot be alienated. Its

ownership is a special collective ownership for general use and payment, in application to the satisfaction of collective needs, and resides in the social group. The purpose is not to serve the State as the juridical person but the citizens; it is intended for the common and public welfare and cannot be the object of appropriation.

The fact that the Roppongi site has not been used for a long time for actual Embassy service doesn’t automatically convert it to patrimonial property. Any such conversion happens only if the property is withdrawn from public use. A property continues to be part of the public domain, not available for private appropriation or ownership until there is a formal declaration on the part of the government to withdraw it from being such.

G.R. No. 92013 July 25, 1990

SALVADOR H. LAUREL, petitioner, vs.RAMON GARCIA, as head of the Asset Privatization Trust, RAUL MANGLAPUS, as Secretary of Foreign Affairs, and CATALINO MACARAIG, as Executive Secretary, respondents.

G.R. No. 92047 July 25, 1990

DIONISIO S. OJEDA, petitioner, vs.EXECUTIVE SECRETARY MACARAIG, JR., ASSETS PRIVATIZATION TRUST CHAIRMAN RAMON T. GARCIA, AMBASSADOR RAMON DEL ROSARIO, et al., as members of the PRINCIPAL AND BIDDING COMMITTEES ON THE UTILIZATION/DISPOSITION PETITION OF PHILIPPINE GOVERNMENT PROPERTIES IN JAPAN, respondents.

Arturo M. Tolentino for petitioner in 92013.

GUTIERREZ, JR., J.:

These are two petitions for prohibition seeking to enjoin respondents, their representatives and agents from proceeding with the bidding for the sale of the 3,179 square meters of land at 306 Roppongi, 5-Chome Minato-ku Tokyo, Japan scheduled on February 21, 1990. We granted the prayer for a temporary restraining order effective February 20, 1990. One of the petitioners (in G.R. No. 92047) likewise prayes for a writ of mandamus to compel the respondents to fully disclose to the public the basis of their decision to push through with the sale of the Roppongi property inspire of strong public opposition and to explain the proceedings which effectively prevent the participation of Filipino citizens and entities in the bidding process.

The oral arguments in G.R. No. 92013, Laurel v. Garcia, et al. were heard by the Court on March 13, 1990. After G.R. No. 92047, Ojeda v. Secretary Macaraig, et al. was filed, the respondents were required to file a comment by the Court's resolution dated February 22, 1990. The two petitions were consolidated on March 27, 1990 when the memoranda of the parties in the Laurel case were deliberated upon.

The Court could not act on these cases immediately because the respondents filed a motion for an extension of thirty (30) days to file comment in G.R. No. 92047, followed by a second motion for an extension of another thirty (30) days which we granted on May 8, 1990, a third motion for extension of time granted on May 24, 1990 and a fourth motion for extension of time which we granted on June 5, 1990 but calling the attention of the respondents to the length of time the petitions have been pending. After the comment was filed, the petitioner in G.R. No. 92047 asked for thirty (30) days to file a reply. We noted his motion and resolved to decide the two (2) cases.

I

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The subject property in this case is one of the four (4) properties in Japan acquired by the Philippine government under the Reparations Agreement entered into with Japan on May 9, 1956, the other lots being:

(1) The Nampeidai Property at 11-24 Nampeidai-machi, Shibuya-ku, Tokyo which has an area of approximately 2,489.96 square meters, and is at present the site of the Philippine Embassy Chancery;

(2) The Kobe Commercial Property at 63 Naniwa-cho, Kobe, with an area of around 764.72 square meters and categorized as a commercial lot now being used as a warehouse and parking lot for the consulate staff; and

(3) The Kobe Residential Property at 1-980-2 Obanoyama-cho, Shinohara, Nada-ku, Kobe, a residential lot which is now vacant.

The properties and the capital goods and services procured from the Japanese government for national development projects are part of the indemnification to the Filipino people for their losses in life and property and their suffering during World War II.

The Reparations Agreement provides that reparations valued at $550 million would be payable in twenty (20) years in accordance with annual schedules of procurements to be fixed by the Philippine and Japanese governments (Article 2, Reparations Agreement). Rep. Act No. 1789, the Reparations Law, prescribes the national policy on procurement and utilization of reparations and development loans. The procurements are divided into those for use by the government sector and those for private parties in projects as the then National Economic Council shall determine. Those intended for the private sector shall be made available by sale to Filipino citizens or to one hundred (100%) percent Filipino-owned entities in national development projects.

The Roppongi property was acquired from the Japanese government under the Second Year Schedule and listed under the heading "Government Sector", through Reparations Contract No. 300 dated June 27, 1958. The Roppongi property consists of the land and building "for the Chancery of the Philippine Embassy" (Annex M-D to Memorandum for Petitioner, p. 503). As intended, it became the site of the Philippine Embassy until the latter was transferred to Nampeidai on July 22, 1976 when the Roppongi building needed major repairs. Due to the failure of our government to provide necessary funds, the Roppongi property has remained undeveloped since that time.

A proposal was presented to President Corazon C. Aquino by former Philippine Ambassador to Japan, Carlos J. Valdez, to make the property the subject of a lease agreement with a Japanese firm - Kajima Corporation — which shall construct two (2) buildings in Roppongi and one (1) building in Nampeidai and renovate the present Philippine Chancery in Nampeidai. The consideration of the construction would be the lease to the foreign corporation of one (1) of the buildings to be constructed in Roppongi and the two (2) buildings in Nampeidai. The other building in Roppongi shall then be used as the Philippine Embassy Chancery. At the end of the lease period, all the three leased buildings shall be occupied and used by the Philippine government. No change of ownership or title shall occur. (See Annex "B" to Reply to Comment) The Philippine government retains the title all throughout the lease period and thereafter. However, the government has not acted favorably on this proposal which is pending approval and ratification between the parties. Instead, on August 11, 1986, President Aquino created a committee to study the disposition/utilization of Philippine government properties in Tokyo and Kobe, Japan through Administrative Order No. 3, followed by Administrative Orders Numbered 3-A, B, C and D.

On July 25, 1987, the President issued Executive Order No. 296 entitling non-Filipino citizens or entities to avail of separations' capital goods and services in the event of sale, lease or disposition. The four properties in Japan including

the Roppongi were specifically mentioned in the first "Whereas" clause.

Amidst opposition by various sectors, the Executive branch of the government has been pushing, with great vigor, its decision to sell the reparations properties starting with the Roppongi lot. The property has twice been set for bidding at a minimum floor price of $225 million. The first bidding was a failure since only one bidder qualified. The second one, after postponements, has not yet materialized. The last scheduled bidding on February 21, 1990 was restrained by his Court. Later, the rules on bidding were changed such that the $225 million floor price became merely a suggested floor price.

The Court finds that each of the herein petitions raises distinct issues. The petitioner in G.R. No. 92013 objects to the alienation of the Roppongi property to anyone while the petitioner in G.R. No. 92047 adds as a principal objection the alleged unjustified bias of the Philippine government in favor of selling the property to non-Filipino citizens and entities. These petitions have been consolidated and are resolved at the same time for the objective is the same - to stop the sale of the Roppongi property.

The petitioner in G.R. No. 92013 raises the following issues:

(1) Can the Roppongi property and others of its kind be alienated by the Philippine Government?; and

(2) Does the Chief Executive, her officers and agents, have the authority and jurisdiction, to sell the Roppongi property?

Petitioner Dionisio Ojeda in G.R. No. 92047, apart from questioning the authority of the government to alienate the Roppongi property assails the constitutionality of Executive Order No. 296 in making the property available for sale to non-Filipino citizens and entities. He also questions the bidding procedures of the Committee on the Utilization or Disposition of Philippine Government Properties in Japan for being discriminatory against Filipino citizens and Filipino-owned entities by denying them the right to be informed about the bidding requirements.

II

In G.R. No. 92013, petitioner Laurel asserts that the Roppongi property and the related lots were acquired as part of the reparations from the Japanese government for diplomatic and consular use by the Philippine government. Vice-President Laurel states that the Roppongi property is classified as one of public dominion, and not of private ownership under Article 420 of the Civil Code (See infra).

The petitioner submits that the Roppongi property comes under "property intended for public service" in paragraph 2 of the above provision. He states that being one of public dominion, no ownership by any one can attach to it, not even by the State. The Roppongi and related properties were acquired for "sites for chancery, diplomatic, and consular quarters, buildings and other improvements" (Second Year Reparations Schedule). The petitioner states that they continue to be intended for a necessary service. They are held by the State in anticipation of an opportune use. (Citing 3 Manresa 65-66). Hence, it cannot be appropriated, is outside the commerce of man, or to put it in more simple terms, it cannot be alienated nor be the subject matter of contracts (Citing Municipality of Cavite v. Rojas, 30 Phil. 20 [1915]). Noting the non-use of the Roppongi property at the moment, the petitioner avers that the same remains property of public dominion so long as the government has not used it for other purposes nor adopted any measure constituting a removal of its original purpose or use.

The respondents, for their part, refute the petitioner's contention by saying that the subject property is not governed by our Civil Code but by the laws of Japan where the property is located. They rely upon the rule of lex situs which is used in determining the applicable law regarding the acquisition, transfer and devolution of the title to a property. They also invoke Opinion No. 21, Series of 1988, dated

35

January 27, 1988 of the Secretary of Justice which used the lex situs in explaining the inapplicability of Philippine law regarding a property situated in Japan.

The respondents add that even assuming for the sake of argument that the Civil Code is applicable, the Roppongi property has ceased to become property of public dominion. It has become patrimonial property because it has not been used for public service or for diplomatic purposes for over thirteen (13) years now (Citing Article 422, Civil Code) and because the intention by the Executive Department and the Congress to convert it to private use has been manifested by overt acts, such as, among others: (1) the transfer of the Philippine Embassy to Nampeidai (2) the issuance of administrative orders for the possibility of alienating the four government properties in Japan; (3) the issuance of Executive Order No. 296; (4) the enactment by the Congress of Rep. Act No. 6657 [the Comprehensive Agrarian Reform Law] on June 10, 1988 which contains a provision stating that funds may be taken from the sale of Philippine properties in foreign countries; (5) the holding of the public bidding of the Roppongi property but which failed; (6) the deferment by the Senate in Resolution No. 55 of the bidding to a future date; thus an acknowledgment by the Senate of the government's intention to remove the Roppongi property from the public service purpose; and (7) the resolution of this Court dismissing the petition in Ojeda v. Bidding Committee, et al., G.R. No. 87478 which sought to enjoin the second bidding of the Roppongi property scheduled on March 30, 1989.

III

In G.R. No. 94047, petitioner Ojeda once more asks this Court to rule on the constitutionality of Executive Order No. 296. He had earlier filed a petition in G.R. No. 87478 which the Court dismissed on August 1, 1989. He now avers that the executive order contravenes the constitutional mandate to conserve and develop the national patrimony stated in the Preamble of the 1987 Constitution. It also allegedly violates:

(1) The reservation of the ownership and acquisition of alienable lands of the public domain to Filipino citizens. (Sections 2 and 3, Article XII, Constitution; Sections 22 and 23 of Commonwealth Act 141).i•t•c-aüsl

(2) The preference for Filipino citizens in the grant of rights, privileges and concessions covering the national economy and patrimony (Section 10, Article VI, Constitution);

(3) The protection given to Filipino enterprises against unfair competition and trade practices;

(4) The guarantee of the right of the people to information on all matters of public concern (Section 7, Article III, Constitution);

(5) The prohibition against the sale to non-Filipino citizens or entities not wholly owned by Filipino citizens of capital goods received by the Philippines under the Reparations Act (Sections 2 and 12 of Rep. Act No. 1789); and

(6) The declaration of the state policy of full public disclosure of all transactions involving public interest (Section 28, Article III, Constitution).

Petitioner Ojeda warns that the use of public funds in the execution of an unconstitutional executive order is a misapplication of public funds He states that since the details of the bidding for the Roppongi property were never publicly disclosed until February 15, 1990 (or a few days before the scheduled bidding), the bidding guidelines are available only in Tokyo, and the accomplishment of requirements and the selection of qualified bidders should be done in Tokyo, interested Filipino citizens or entities owned by them did not have the chance to comply with Purchase Offer Requirements on the Roppongi. Worse, the Roppongi shall be sold for a minimum price of $225 million from which price capital gains tax under Japanese law of about 50 to 70% of the floor price would still be deducted.

IV

The petitioners and respondents in both cases do not dispute the fact that the Roppongi site and the three related properties were through reparations agreements, that these were assigned to the government sector and that the Roppongi property itself was specifically designated under the Reparations Agreement to house the Philippine Embassy.

The nature of the Roppongi lot as property for public service is expressly spelled out. It is dictated by the terms of the Reparations Agreement and the corresponding contract of procurement which bind both the Philippine government and the Japanese government.

There can be no doubt that it is of public dominion unless it is convincingly shown that the property has become patrimonial. This, the respondents have failed to do.

As property of public dominion, the Roppongi lot is outside the commerce of man. It cannot be alienated. Its ownership is a special collective ownership for general use and enjoyment, an application to the satisfaction of collective needs, and resides in the social group. The purpose is not to serve the State as a juridical person, but the citizens; it is intended for the common and public welfare and cannot be the object of appropration. (Taken from 3 Manresa, 66-69; cited in Tolentino, Commentaries on the Civil Code of the Philippines, 1963 Edition, Vol. II, p. 26).

The applicable provisions of the Civil Code are:

ART. 419. Property is either of public dominion or of private ownership.

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 the preceding article, is patrimonial property.

The Roppongi property is correctly classified under paragraph 2 of Article 420 of the Civil Code as property belonging to the State and intended for some public service.

Has the intention of the government regarding the use of the property been changed because the lot has been Idle for some years? Has it become patrimonial?

The fact that the Roppongi site has not been used for a long time for actual Embassy service does not automatically convert it to patrimonial property. Any such conversion happens only if the property is withdrawn from public use (Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481 [1975]). A property continues to be part of the public domain, not available for private appropriation or ownership until there is a formal declaration on the part of the government to withdraw it from being such (Ignacio v. Director of Lands, 108 Phil. 335 [1960]).

The respondents enumerate various pronouncements by concerned public officials insinuating a change of intention. We emphasize, however, that an abandonment of the intention to use the Roppongi property for public service and

36

to make it patrimonial property under Article 422 of the Civil Code must be definite Abandonment cannot be inferred from the non-use alone specially if the non-use was attributable not to the government's own deliberate and indubitable will but to a lack of financial support to repair and improve the property (See Heirs of Felino Santiago v. Lazaro, 166 SCRA 368 [1988]). Abandonment must be a certain and positive act based on correct legal premises.

A mere transfer of the Philippine Embassy to Nampeidai in 1976 is not relinquishment of the Roppongi property's original purpose. Even the failure by the government to repair the building in Roppongi is not abandonment since as earlier stated, there simply was a shortage of government funds. The recent Administrative Orders authorizing a study of the status and conditions of government properties in Japan were merely directives for investigation but did not in any way signify a clear intention to dispose of the properties.

Executive Order No. 296, though its title declares an "authority to sell", does not have a provision in its text expressly authorizing the sale of the four properties procured from Japan for the government sector. The executive order does not declare that the properties lost their public character. It merely intends to make the properties available to foreigners and not to Filipinos alone in case of a sale, lease or other disposition. It merely eliminates the restriction under Rep. Act No. 1789 that reparations goods may be sold only to Filipino citizens and one hundred (100%) percent Filipino-owned entities. The text of Executive Order No. 296 provides:

Section 1. The provisions of Republic Act No. 1789, as amended, and of other laws to the contrary notwithstanding, the above-mentioned properties can be made available for sale, lease or any other manner of disposition to non-Filipino citizens or to entities owned by non-Filipino citizens.

Executive Order No. 296 is based on the wrong premise or assumption that the Roppongi and the three other properties were earlier converted into alienable real properties. As earlier stated, Rep. Act No. 1789 differentiates the procurements for the government sector and the private sector (Sections 2 and 12, Rep. Act No. 1789). Only the private sector properties can be sold to end-users who must be Filipinos or entities owned by Filipinos. It is this nationality provision which was amended by Executive Order No. 296.

Section 63 (c) of Rep. Act No. 6657 (the CARP Law) which provides as one of the sources of funds for its implementation, the proceeds of the disposition of the properties of the Government in foreign countries, did not withdraw the Roppongi property from being classified as one of public dominion when it mentions Philippine properties abroad. Section 63 (c) refers to properties which are alienable and not to those reserved for public use or service. Rep Act No. 6657, therefore, does not authorize the Executive Department to sell the Roppongi property. It merely enumerates possible sources of future funding to augment (as and when needed) the Agrarian Reform Fund created under Executive Order No. 299. Obviously any property outside of the commerce of man cannot be tapped as a source of funds.

The respondents try to get around the public dominion character of the Roppongi property by insisting that Japanese law and not our Civil Code should apply.

It is exceedingly strange why our top government officials, of all people, should be the ones to insist that in the sale of extremely valuable government property, Japanese law and not Philippine law should prevail. The Japanese law - its coverage and effects, when enacted, and exceptions to its provision — is not presented to the Court It is simply asserted that the lex loci rei sitae or Japanese law should apply without stating what that law provides. It is a ed on faith that Japanese law would allow the sale.

We see no reason why a conflict of law rule should apply when no conflict of law situation exists. A conflict of law situation arises only when: (1) There is a dispute over the title or ownership of an immovable, such that the capacity to take and transfer immovables, the formalities of conveyance, the essential validity and effect of the transfer, or the interpretation and effect of a conveyance, are to be determined (See Salonga, Private International Law, 1981 ed., pp. 377-383); and (2) A foreign law on land ownership and its conveyance is asserted to conflict with a domestic law on the same matters. Hence, the need to determine which law should apply.

In the instant case, none of the above elements exists.

The issues are not concerned with validity of ownership or title. There is no question that the property belongs to the Philippines. The issue is the authority of the respondent officials to validly dispose of property belonging to the State. And the validity of the procedures adopted to effect its sale. This is governed by Philippine Law. The rule of lex situs does not apply.

The assertion that the opinion of the Secretary of Justice sheds light on the relevance of the lex situs rule is misplaced. The opinion does not tackle the alienability of the real properties procured through reparations nor the existence in what body of the authority to sell them. In discussing who are capable of acquiring the lots, the Secretary merely explains that it is the foreign law which should determine who can acquire the properties so that the constitutional limitation on acquisition of lands of the public domain to Filipino citizens and entities wholly owned by Filipinos is inapplicable. We see no point in belaboring whether or not this opinion is correct. Why should we discuss who can acquire the Roppongi lot when there is no showing that it can be sold?

The subsequent approval on October 4, 1988 by President Aquino of the recommendation by the investigating committee to sell the Roppongi property was premature or, at the very least, conditioned on a valid change in the public character of the Roppongi property. Moreover, the approval does not have the force and effect of law since the President already lost her legislative powers. The Congress had already convened for more than a year.

Assuming for the sake of argument, however, that the Roppongi property is no longer of public dominion, there is another obstacle to its sale by the respondents.

There is no law authorizing its conveyance.

Section 79 (f) of the Revised Administrative Code of 1917 provides

Section 79 (f ) Conveyances and contracts to which the Government is a party. — In cases in which the Government of the Republic of the Philippines is a party to any deed or other instrument conveying the title to real estate or to any other property the value of which is in excess of one hundred thousand pesos, the respective Department Secretary shall prepare the necessary papers which, together with the proper recommendations, shall be submitted to the Congress of the Philippines for approval by the same. Such deed, instrument, or contract shall be executed and signed by the President of the Philippines on behalf of the Government of the Philippines unless the Government of the Philippines unless the authority therefor be expressly vested by law in another officer. (Emphasis supplied)

The requirement has been retained in Section 48, Book I of the Administrative Code of 1987 (Executive Order No. 292).

37

SEC. 48. Official Authorized to Convey Real Property. — Whenever real property of the Government is authorized by law to be conveyed, the deed of conveyance shall be executed in behalf of the government by the following:

(1) For property belonging to and titled in the name of the Republic of the Philippines, by the President, unless the authority therefor is expressly vested by law in another officer.

(2) For property belonging to the Republic of the Philippines but titled in the name of any political subdivision or of any corporate agency or instrumentality, by the executive head of the agency or instrumentality. (Emphasis supplied)

It is not for the President to convey valuable real property of the government on his or her own sole will. Any such conveyance must be authorized and approved by a law enacted by the Congress. It requires executive and legislative concurrence.

Resolution No. 55 of the Senate dated June 8, 1989, asking for the deferment of the sale of the Roppongi property does not withdraw the property from public domain much less authorize its sale. It is a mere resolution; it is not a formal declaration abandoning the public character of the Roppongi property. In fact, the Senate Committee on Foreign Relations is conducting hearings on Senate Resolution No. 734 which raises serious policy considerations and calls for a fact-finding investigation of the circumstances behind the decision to sell the Philippine government properties in Japan.

The resolution of this Court in Ojeda v. Bidding Committee, et al., supra, did not pass upon the constitutionality of Executive Order No. 296. Contrary to respondents' assertion, we did not uphold the authority of the President to sell the Roppongi property. The Court stated that the constitutionality of the executive order was not the real issue and that resolving the constitutional question was "neither necessary nor finally determinative of the case." The Court noted that "[W]hat petitioner ultimately questions is the use of the proceeds of the disposition of the Roppongi property." In emphasizing that "the decision of the Executive to dispose of the Roppongi property to finance the CARP ... cannot be questioned" in view of Section 63 (c) of Rep. Act No. 6657, the Court did not acknowledge the fact that the property became alienable nor did it indicate that the President was authorized to dispose of the Roppongi property. The resolution should be read to mean that in case the Roppongi property is re-classified to be patrimonial and alienable by authority of law, the proceeds of a sale may be used for national economic development projects including the CARP.

Moreover, the sale in 1989 did not materialize. The petitions before us question the proposed 1990 sale of the Roppongi property. We are resolving the issues raised in these petitions, not the issues raised in 1989.

Having declared a need for a law or formal declaration to withdraw the Roppongi property from public domain to make it alienable and a need for legislative authority to allow the sale of the property, we see no compelling reason to tackle the constitutional issues raised by petitioner Ojeda.

The Court does not ordinarily pass upon constitutional questions unless these questions are properly raised in appropriate cases and their resolution is necessary for the determination of the case (People v. Vera, 65 Phil. 56 [1937]). The Court will not pass upon a constitutional question although properly presented by the record if the case can be disposed of on some other ground such as the application of a statute or general law (Siler v. Louisville and

Nashville R. Co., 213 U.S. 175, [1909], Railroad Commission v. Pullman Co., 312 U.S. 496 [1941]).

The petitioner in G.R. No. 92013 states why the Roppongi property should not be sold:

The Roppongi property is not just like any piece of property. It was given to the Filipino people in reparation for the lives and blood of Filipinos who died and suffered during the Japanese military occupation, for the suffering of widows and orphans who lost their loved ones and kindred, for the homes and other properties lost by countless Filipinos during the war. The Tokyo properties are a monument to the bravery and sacrifice of the Filipino people in the face of an invader; like the monuments of Rizal, Quezon, and other Filipino heroes, we do not expect economic or financial benefits from them. But who would think of selling these monuments? Filipino honor and national dignity dictate that we keep our properties in Japan as memorials to the countless Filipinos who died and suffered. Even if we should become paupers we should not think of selling them. For it would be as if we sold the lives and blood and tears of our countrymen. (Rollo- G.R. No. 92013, p.147)

The petitioner in G.R. No. 92047 also states:

Roppongi is no ordinary property. It is one ceded by the Japanese government in atonement for its past belligerence for the valiant sacrifice of life and limb and for deaths, physical dislocation and economic devastation the whole Filipino people endured in World War II.

It is for what it stands for, and for what it could never bring back to life, that its significance today remains undimmed, inspire of the lapse of 45 years since the war ended, inspire of the passage of 32 years since the property passed on to the Philippine government.

Roppongi is a reminder that cannot — should not — be dissipated ... (Rollo-92047, p. 9)

It is indeed true that the Roppongi property is valuable not so much because of the inflated prices fetched by real property in Tokyo but more so because of its symbolic value to all Filipinos — veterans and civilians alike. Whether or not the Roppongi and related properties will eventually be sold is a policy determination where both the President and Congress must concur. Considering the properties' importance and value, the laws on conversion and disposition of property of public dominion must be faithfully followed.

WHEREFORE, IN VIEW OF THE FOREGOING, the petitions are GRANTED. A writ of prohibition is issued enjoining the respondents from proceeding with the sale of the Roppongi property in Tokyo, Japan. The February 20, 1990 Temporary Restraining Order is made PERMANENT.

SO ORDERED.

Haystack: Harty v. Victoria, Tarlac (GR 5013, 11 March

1909)

Harty v. Victoria, Tarlac

[G.R. No. 5013. March 11, 1909.]

En Banc, Torres (J): 5 concur

38

Facts: On 17 January 1908, the representative of Monsignor

Jeremiah J. Harty, archbishop of the Roman Catholic

Church, as the legal administrator of the properties and

rights of the Catholic Church within the archbishopric of

Manila, filed a written complaint in the CFI Tarlac against the

municipality of Victoria, alleging that the parish of the said

town had been and was then the owner of a parcel of land

within the said municipality, known as the plaza of the

church of Victoria; that it had acquired said parcel of land

more than 60 years previously, and had continued to

possess the same ever since up to 1901, in which year the

municipality unlawfully and forcibly seized the said property,

claiming to be entitled thereto and retaining it to the present

day. On 15 June 1908, the trial court rendered judgment,

holding that the parish of Victoria of the Roman Catholic

Apostolic Church, had a better right to the possession of the

land described in the complaint, and sentenced the

Municipality to vacate the same and to pay the costs. To

said judgment the representative of the Municipality

excepted and moved for a new trial on the ground that it was

contrary to the weight of the evidence, and he notified the

court that, if his motion were overruled, he would appeal to

the Supreme Court. The motion for a new trial was

overruled; the Municipality excepted, and presented the

corresponding bill of exceptions which, after receipt of a

copy had been acknowledged by the adverse party, was

approved. On 1 September, the Municipality was ordered to

furnish bond in the sum of P1,000 to insure the fulfillment of

the judgment in the event that it should be totally or partially

affirmed. To said order the Municipality excepted, but

furnished the bond as directed by the court.

The Supreme Court reversed the judgment appealed from,

and held that the whole of the land not occupied by the

church of the town of Victoria and its parish house, is a

public plaza of the said town, of public use, and that in

consequence thereof, the Municipality is absolved of the

complaint without any special ruling as to the costs of both

instances.

1. Property of public ownership

Article 339 of the Civil Code provides that "property of public

ownership is (1) that destined to the public use, such as

roads, canals, rivers, torrents, ports, and bridges constructed

by the State, and banks, shores, roadsteads, and that of a

similar character." Further, Article 344 of said code provides

that "property for public use in provinces and in towns

comprises the provincial and town roads, the squares,

streets, fountains, and public waters, the promenades, and

public works of general service supported by the said towns

or provinces."

2. History of the municipality of Victoria, Tarlac;

Customs in creation of new town under the old Laws of

the Indies

The town of Victoria was formerly only a barrio of the town of

Tarlac and known as Canarum. It was converted into a town

in 1855, and named Victoria. To this end they must have laid

out the streets and the plaza of the town, in the center of

which were situated the church and parish house from the

commencement, and at the expiration of about 12 years the

parish of said town was constituted and the priest who was

to perform the office of curate was appointed; that from the

very beginning, the large tract of land that surrounds the

church and the parish house was known as a public plaza,

destined to the use of all the residents of the recently

founded town; public performances and religious

processions were held thereon without hindrance either on

the part of the local authorities or of the curate of said town.

Further, it was a custom observed by all the towns

established administratively in these Islands under the old

Laws of the Indies, that on their creation, a certain amount of

land was always reserved for plazas, commons, and special

and communal property, and as it is unquestionable that the

said large space of land was left vacant in the center of the

town of Victoria when it was constituted as a civil town.

3. The late Tanedo donated the land occupied by the

Church to the church and not to the parish curate

There are good grounds to suppose that the late Vicente

Tanedo donated the land now occupied by the church and

parish house in said municipality for religious purposes, or to

the church, but not to the parish curate, because at the time

there was no curate at the new town of Victoria.

4. Proof lacking if the land Tanedo donated include the

whole large tract constituting the town plaza; Waiver of

rights thereon in favor of the public presumed

It may be true that the father of the witness Casimiro

Tañedo, who owned the space of land where the church and

parish house were erected, had voluntarily donated it to the

Catholic Church but proper proof is lacking that the donation

affirmed by the said Tanedo comprehended the whole of the

large tract which at the present time constitutes the plaza of

the town. Even though all the remaining space of land which

now forms the great plaza of the town of Victoria had been

owned by the said Tanedo, it must be presumed that he

waived his right thereto for the benefit of the townspeople,

since all the residents have enjoyed the free use of said

plaza. It has not been satisfactorily shown that the

municipality or the principales of the town of Victoria had

donated the whole of said land to the curate of Victoria or to

the Catholic Church, nor could it have been so donated, it

being a public plaza destined to public use and was not

private ownership, or patrimony of the town of Victoria, or of

the Province of Tarlac. Certain it is that the Curate has not

proven that the Catholic Church or the parish of Victoria was

the owner or proprietor of the said extensive piece of land

which now forms the public plaza of said town, nor that it

was in possession thereof under the form and conditions

required by law, inasmuch as it has been fully proven that

said plaza has been used without let or hindrance by the

public and the residents of the town of Victoria ever since its

creation.

5. Plazas destined for public use not subject to

prescription

Pursuant to Article 1936 of the Civil Code, plazas, among

other things, destined to the public use are not subject to

prescription.

6. Procured trees set out in the plaza does not constitute

an act of private ownership

That both the curates and the gobernadorcillos of the said

town procured fruit trees and plants to be set out in the

plaza, does not constitute an act of private ownership, but

evidences the public use thereof, or perhaps the intention to

39

improve the and embellish the said plaza for the benefit of

the townspeople.

G.R. No. L-5013 March 11, 1909

JEREMIAH J. HARTY, Roman Catholic Archbishop of Manila, plaintiff-appellee,

vs.

THE MUNICIPALITY OF VICTORIA, Province of Tarlac, defendant-appellant.

F. Buencamino for appellant. Hartigan and Rohde for appellee.

TORRES, J.:

On January 17, 1908, the representative of Mgr. Jeremiah J. Harty, archbishop of the Roman Catholic Church, as the legal administrator of all the properties and rights of the Catholic Church within the archbishopric of Manila, filed a written complaint in the Court of First Instance of Tarlac against the municipality of Victoria, alleging that the parish of the said town had been and was then the owner of a parcel of land within the said municipality, known as the plaza of the church of Victoria; that it had acquired said parcel of land more than sixty years previously, and had continued to possess the same ever since up to 1901, in which year the defendant municipality unlawfully and forcibly seized the said property, claiming to be entitled thereto and retaining it to the present day. For the purposes of the complaint, a description of the meters and bounds of the land in question was set forth in the writing, and plaintiff prayed that, in view of what was therein set forth, judgment be entered holding that the said land was the property of the parish of Victoria, of the Roman Catholic Apostolic Church, and that the defendant be ordered to vacate the same and to pay the costs of the action.

The defendant municipality answered the complaint through its attorney and offered a general denial of all the facts stated therein, especially of those numbered 4, 5, 6, and 7; in special defense it alleged that the plaza described in No. 4 of the complaint was founded when the sitio denominated Canarum, a barrio of the town of Tarlac, was converted into a civil town in 1855; that the parish of Tarlac was established many years after the civil town, and that therefore, it neither had then, nor has now any title to the plaza claimed, and that the complaint injured the defendant, and for this reason it prayed that judgment be entered absolving the defendant of the complaint with costs and damages against the plaintiff.

Evidence was adduced by both parties, and the documents exhibited, to one of which the plaintiff objected, were made of record; the trial court rendered judgment on the 15th of June, 1908, holding that the parish of Victoria of the Roman Catholic Apostolic Church, had a better right to the possession of the land described in the complaint, and sentenced the defendant to vacate the same and to pay the costs. To said judgment the representative of the defendant excepted and moved for a new trial on the ground that it was contrary to the weight of the evidence, and he notified the court that, if his motion were overruled, he would appeal to the Supreme Court. The motion for a new trial was overruled; the defendant excepted, and presented the corresponding bill of exceptions which, after receipt of a copy had been acknowledged by the adverse party, was approved. On the 1st of September last, the appellant was ordered to furnish bond in the sum of P1,000 to insure the fulfillment of the judgment in the event that it should be totally or partially affirmed. To said order the defendant excepted, but furnished the bond as directed by the court.

In view of the nature of the action brought by the plaintiff against the municipality of Victoria, Province of Tarlac, the question that has arisen between the contending parties consists only in determining who is the owner and proprietor of the parcel of land that surrounds the parish church of the said town, and which is called the public plaza of the same.

Article 339 of the Civil Code reads:

Property of public ownership is:

1. That destined to the public use, such as roads, canals, rivers, torrents, ports, and bridges constructed by the State, and banks, shores, roadsteads, and that of a similar character.

Article 344 of said code also reads:

Property for public use in provinces and in towns comprises the provincial and town roads, the squares, streets, fountains, and public waters, the promenades, and public works of general service supported by the said towns or provinces.

From the evidence presented by both parties it appears that the town of Victoria, which was formerly only a barrio of the town of Tarlac and known as Canarum, was converted into a town in 1855, and named Victoria; to this end they must have laid out the streets and the plaza of the town, in the center of which were situated the church and parish house from the commencement, and at the expiration of about twelve years the parish of said town was constituted and the parish who was to perform the office of curate was appointed; that from the very beginning, the large tract of land that surrounds the church and the parish house was known as a public plaza , destined to the use of all the residents of the recently founded town; public performances and religious processions were held thereon without hindrance either on the part of the local authorities or of the curate of said town.

It must be assumed that the principal residents of the old barrio, being interested in the conversion of the barrio into a civil town, arranged in such a way that the barrio, as the center of the future town which was subsequently called Victoria, should have streets and a public plaza with its church and parish house, and also a tribunal or building destined for the use of the municipality and the local official at that time called the gobernadorcillo and later on capitán municipal, as has occurred in the foundation of all the towns in these Islands, under the old administrative laws.

It may be true that the father of the witness Casimiro Tañedo, who owned the space of land where the church and parish house were erected, had voluntarily donated it to the Catholic Church, the only one known at the time, but proper proof is lacking that the donation affirmed by the said Tañedo comprehended the whole of the large tract which at the present time constitute the plaza of the town.

It was a custom observed by all the towns established administratively in these Islands under the old Laws of the Indies, that on their creation, a certain amount of land was always reserved for plazas , commons, and special and communal property, and as it is unquestionable that the said large space of land was left vacant in the center of the town of Victoria when it was constituted as a civil town, more than twelve years prior to the appointment of a permanent curate therein, there are good grounds to suppose that the late Vicente Tañedo donated the land now occupied by the church and the parish house in said municipality for religious purposes, or to the church, but not to the parish curate because at the time there was no curate at the new town of Victoria.

Even though all the remaining space of land which now forms the great plaza of the town of Victoria had been owned by the said Tañedo, it must be presumed that he waived his right thereto for the benefit of the townspeople, since from the creation or establishment of the town, down to the present day, all the residents, including the curate of said town, have enjoyed the free use of said plaza ; it has not been satisfactorily shown that the municipality or the principales of the town of Victoria had donated the whole of said land to the curate of Victoria or to the Catholic Church, as alleged, nor could it have been so donated, it being a public plaza destined to public use and was not of private

40

ownership, or patrimony of the town of Victoria, or of the Province of Tarlac.

It should be noted that, among other things, plaza s destined to the public use are not subject to prescription. (Art. 1936, Civil Code.)

That both the curates and the gobernadorcillos of the said town procured fruit trees and plants to be set out in the plaza , does not constitute an act of private ownership, but evidences the public use thereof, or perhaps the intention to improve and embellish the said plaza for the benefit of the townspeople.

Certain it is that the plaintiff has not proven that the Catholic Church or the parish of Victoria was the owner or proprietor of the said extensive piece of land which now forms the public plaza of said town, nor that it was in possession thereof under the form and conditions required by law, inasmuch as it has been fully proven that said plaza has been used without let or hindrance by the public and the residents of the town of Victoria ever since its creation. For the above reasons it is our opinion that the judgment appealed from should be reversed, and that it should be held, as we do hereby hold, that the whole of the land not occupied by the church of the town of Victoria and its parish house, is a public plaza of the said town, of public use, and that in consequence thereof, the defendant is absolved of the complaint without any special ruling as to the costs of both instances.

G.R. No. L-40851             July 31, 1935

THE DIRECTOR OF LANDS, applicant-appellee, vs.THE ROMAN CATHOLIC BISHOP OF ZAMBOANGA, oppositor-appellant. THE MUNICIPALITY OF MISAMIS, oppositor-appellee.

Evangelista and Santos for appellant.Eugenio S. del Rosario for appellee.

IMPERIAL, J.:

In cadastral case No. 2 of Occidental Misamis, G.L.R.O. Record No. 1210, the Roman Catholic Bishop of Zamboanga sought the registration in the name of the Roman Catholic Apostolic Church of four (4) parcels of land, known as lots Nos. 1, 2, 3 and 4, and the improvements thereon, situated in the center of the town of the municipality of Misamis. The Director of Lands claimed said properties alleging them to be of the public domain, having been reserved for parks by virtue of the Governor-General's Proclamation No. 360, dated February 7, 1931. The municipality of Misamis likewise claimed lots No. 1, 2, and 3, and a southwestern portion of lot No. 4, having an area of 5,539 square meters, alleging them to be public plazas.

After the necessary hearing wherein the parties presented their respective evidence, the court rendered judgment ordering the registration of lot No. 4 with the improvements thereon in favor of the Roman Catholic Bishop of Zamboanga and the registration of lots Nos. 1, 2 and 3 in favor of the municipality of Misamis, thereby overruling the claim of the Director of Lands. Only the Roman Catholic Bishop of Zamboanga appealed.

The four lots are really only one parcel and are bounded on the four sides thereof by Norte America, Ledesma, Washington and Commercial streets. These four streets existed from time immemorial, although with different names. Said four lots were already in the possession of the Roman Catholic Apostolic Church some years prior to the year 1789, and the church, belfry and convert which served as dwelling for the parish priests were built on lot No. 4. Heretofore its possession has been quiet, open, public, continuous and under claim of ownership. The land identified as lot No. 1 always formed part of lot No. 4. The so-called lot No. 2 was occupied by nobody except the church through its parish priests, until the local authorities converted it into an

extension of Mabini Street which terminated at Norte America Street. As to lot No. 3, it has always been in the possession of the church but it was occupied by two schools for children of both sexes during the Spanish regime. The girl's school was destroyed upon the arrival of the Americans and the other school for boys was destroyed and it ceased to exist about the year 1915. On one side of this land the municipal authorities succeeded in erecting a monument of Rizal, which still stands.

The possession by the Roman Catholic Apostolic Church of the lands in dispute for a period of about a century and a half, under the conditions above stated, can mean nothing more than that said lands were designated by the State itself to be devoted to the building of the church, belfry and convent for the purpose of implanting the Roman Catholic Apostolic Religion and maintaining the cult thereof.

In the case of Barlin vs. Ramirez and Municipality of Lagonoy (7 Phil., 41 et seq.), this court said:

(2) The municipality of Lagonoy, in its answer, claims as such, to be the owner of the property. As we have said before, the evidence shows that it never was in the physical possession of the property. But waiving this point and assuming that the possession of Ramirez, which he alleges in his answer is the possession of the municipality, gives the municipality the rights of a possessor, the question still arises, Who has the better right to the present possession of the property? The plaintiff, in 1902, had been in the lawful possession thereof for more than thirty years and during all that time its possession had never been questioned or disturbed. That possession has been taken away from it and it has the right now to recover the possession from the persons who have so deprived it of such possession, unless the latter can show that they have a better right thereto. This was the proposition which was discussed and settled in the case of the Bishop of Cebu vs. Mangaron, No. 1748 (6 Phil., 286, decided June 1, 1906). That decision holds that as against one who has been in possession for the length of time the plaintiff has been in possession, and who has been deprived of his possession, and who cannot produce any written evidence of title, the mere fact that the defendant is in possession does not entitle the defendant to retain that possession. In order that he may continue in possession, he must show a better right thereto.

The evidence in this case does not show that the municipality has, as such, any right whatever in the property in question. It has produced no evidence of ownership. Its claim of ownership is rested in its brief in this court upon the following propositions: That the property in question belonged prior the Treaty of Paris to the Spanish Government; that by the Treaty of Paris the ownership thereof passed to the Government of the United States; that by section 12 of the Act of Congress of July 1, 1902, such property was transferred to the Government of the Philippine Islands, and that by the circular of that Government, dated November 11, 1902, the ownership and the right to the possession of this property passed to the municipality of Lagonoy. If, for the purposes of the argument, we should admit that the other propositions are true, there is no evidence whatever to support the last proposition, namely that the Government of the Philippine Islands has transferred the ownership of this church to the municipality of Lagonoy. We have found no circular of the date above referred to. The one of February 10, 1903, which is probably the one intended, contains nothing that indicates any such transfer. As to the municipality of Lagonoy, therefore, it is very clear that it has neither title, ownership, nor right to possession.

(3) We have said that it would have no such title or ownership even admitting that the Spanish

41

Government was the owner of the property and that it passed by the Treaty of Paris to the American Government. But this assumption is not true. As a matter of law, the Spanish Government at the time the treaty of peace was signed, was not the owner of this property, nor of any other property like it, situated in the Philippine Islands.

It does not admit of doubt that from the earliest times the parish churches in the Philippine Islands were built by the Spanish Government. Law 2, title 2, book 1, of the Compilation of the Laws of the Indies is, in part, as follows:

"Having erected all the churches, cathedrals, and parish houses of the Spaniards and natives of our Indian possessions from their discovery at the cost and expense of our royal treasury, and applied for their service and maintenance the part of the tithes belonging to us by apostolic concession according to the division we have made."

The syllabus of the case of the Roman Catholic Apostolic Church vs. Municipality of Placer (11 Phil., 315), reads:

ROMAN CATHOLIC CHURCH PROPERTY; OWNERSHIP. — On the authority of the Municipality of Ponce vs. Roman Catholic Apostolic Church in Porto Rico, decided by the United States Supreme Court June 1, 1908; Held, That under the Spanish law heretofore existing in these Islands and the provisions of the treaty of Paris, the Roman Catholic Apostolic Church is the owner of a church building, convent, and cemetery, and that the municipality wherein the same are situated has no right of ownership therein by reason of funds or land contributed for the foundation or erection thereof.

In the case of the Roman Catholic Apostolic Church vs. Municipalities of Caloocan, Morong and Malabon, of the Province of Rizal (12 Phil., 639 et seq.), this court in analyzing the laws governing the temporal properties of the church in these Islands again stated:

The evidence discloses, beyond peradventure of doubt, that the plaintiff had been in the quiet and peaceable possession of the different parcels of property, with reference to which evidence was presented, for a period immemorial, until some time between the years 1896-1899, when they were molested in their possession and deprived of the same by some of the defendants. This court has repeatedly decided that where a person has been in the long possession or real property and has been deprived of the possession thereof, he may recover it as against one in possession, unless the latter can show a better right thereto. (Bishop of Cebu vs. Mangaron, 6 Phil., 286; Barlin vs. Ramirez, 7 Phil, 41; Roman Catholic Apostolic Church vs. Santos, 7 Phil., 66; City of Manila vs. Roman Catholic Apostolic Church, 8 Phil., 763; Roman Catholic Apostolic Church vs. Municipality of Tarlac, 9 Phil, 450; Roman Catholic Apostolic Church vs. Certain Municipalities, etc., 10 Phil., 1; Roman Catholic Apostolic Church vs. Municipality of Badoc, 10 Phil., 659; Roman Catholic Apostolic Church vs. Municipality of Cuyapo, 9 Phil., 457; Roman Catholic Apostolic Church vs. Certain Municipalities, etc., 9 Phil., 691.)

x x x           x x x           x x x

In the case of the Roman Catholic Apostolic Church vs. Municipality of Placer (11 Phil., 315), the facts therein being very analogous to the facts in the present case, this court followed the said decision of the Supreme Court of the United States, holding that, under the Spanish law heretofore existing in these Islands, and the provisions of the Treaty of Paris, the Roman Catholic Apostolic Church is the owner of the church buildings, convents, and cemeteries and

the municipalities wherein the same are situated have no right of ownership therein by reason of funds or lands contributed for the foundation or erection thereof.

Our attention has not been called to any express granted or grants of land by the Crown of Spain for the purposes of the church upon which particular churches were erected, and it is believed that, during the early history of the sovereignty of Spain in the Indies, no such grants can be found, but no fact is better established in both secular and ecclesiastical history than the fact that the Crown of Spain and the Pope always cooperated from the very earliest history of the possession of the Indies in the extension of the great benefits offered by the Roman Catholic Apostolic Church to the Indio, as well as to the peoples of Europe. If any difference whatever existed in the efforts thus made in the great interest which the church took in the different peoples, it was in favor of the Indio. Scarcely had the Indies been discovered until the Pope and the Crown of Spain began to manifest a deep interest in the religious and educational welfare of the people of the Indies. (Bula de Alejandro VI of the 4th of May, 1493; also the Bula of 16th of December, 1501; Ordenanza 5 (a) por el Consejo de Las Indias, 1575; law 10, title 1, book 1 of Laws of the Indias, of the 1st of June, 1574; law 14, title 2, book 1 of the Laws of the Indias, and many others, the collection of which may be found in vol. 7 of Legislacion Ultramarina, p. 476.)

From the reading of these various bulas and royal decrees and ordenanzas, it will be seen that the government and the church were constantly working together for the advancement of the religious and educational welfare of the Indios. The government lent its most enthusiastic support to the efforts that were made by the church in this regard, even to the extent of paying out of the public exchequer, funds, together with funds contributed by the encomenderos and the people of the pueblos, for the purpose of erecting the magnificent Catholic churches existing everywhere throughout the Spanish island possessions. While the Crown of Spain always reserved a certain control over the operations of the Catholic Church, yet no one can doubt that, when these lands were donated or designated and the church edifices were erected thereon, it was the intention of the Crown that such lands and such edifices should be devoted absolutely to the use of the church. It is a well-known fact that, when a church edifice of the Roman Catholic Apostolic Church was once accepted and dedicated for religious purposes, it thereafter could never be used for any other purpose. The Catholic Church certainly had a right to believe at least that, during the three hundred years or more that it occupied its churches in the Philippine Islands, without protest or objection on the part of the Crown of Spain, the Crown had intended at least that they should become the absolute owners of such properties. And no protest has been called to our attention during a time immemorial and no protest or objection by the different pueblos to the right of ownership which the church has exercised for from two to three hundred years over the properties upon which the edifices of the Roman Catholic Apostolic Church were erected. Not only is it believed that the Crown of Spain intended that the Roman Catholic Apostolic Church should exercise absolute dominion over such properties, but under the treaty of Paris the Government of the United States obligated itself to protect all such interests. The Roman Catholic Apostolic Church occupied the different properties in question in this case for a time so long that no one in the pueblos could remember when such properties were not occupied and used for the benefit of said church, until about the years 1896-99. The occupancy of property for from two to three hundred years without protest of any kind whatever from the donors would seem at least two be sufficient time, in the absence of positive proof to the contrary,

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that such donation was made for the purpose of transferring to the donee all rights and interests in such property.

Therefore, adhering to and following the decision of the Supreme Court of the United States in the case of the Municipality of Ponce vs. Roman Catholic Apostolic Church in Porto Rico (28 Sup. Ct. Rep., 737; 6 Off. Gaz., 1213) and the decision of this court in the case of the Roman Catholic Apostolic Church vs. Municipality of Placer, supra, we do hereby find that the plaintiff herein is entitled to the right of possession and ownership of the following properties:

La visita de Dampalit;La visita de Ningan;La visita de Catmon;La visita de Tinajeros;La visita de Maysilo;La visita de Matahong;La visita de Muson;La visita de Julong-Dujat,

each situated in barrios of the same names, in the pueblo of Malabon, Province of Rizal; and also to the right of possession and ownership of the cementerio of the pueblo of Morong and the cementerio of Cardona in the pueblo of Morong.

The circumstance that public schools for children of both sexes were erected on lot No. 3 during the Spanish regime is not conclusive evidence that the land was segregated from the great portion thereof designated for the Roman Catholic Apostolic Church and its cults particularly it we take into account the fact that primary instruction was then under the direct supervision of the parish priests who received subsidy from the government.

In the case of the Municipality of Nueva Caceres vs. Director of Lands and Roman Catholic Bishop of Nueva Caceres (24 Phil., 485 et seq.), it was stated:

Therefore, it will be seen from a reading of the above royal decrees and regulations governing the primary instruction of the boys, that boys' schools were under the direction and control of both the church and the state. It was only natural that the schools of the church should be governed by the general laws regulating primary instruction inasmuch as all the schools were under its supervision; and as by throwing open the school to the public, boys generally would be instructed in the faith, it was to the advantage of the church to make its schools as public as possible.

So, the fact that the Government intervened in the administration of the school in no way tends to show or prove that the church had ceded the building or the lot in question to either the local or central government of Spain in the Philippines. On the contrary, it would have been highly unreasonable that such should have been the case, for the church is very jealous of its property and especially of its educational institutions for the instruction of the young, and especially of a lot and building which faced its cathedral in Nueva Caceres and adjoined the same lot on which its seminary for the instruction of aspirants to the priesthood was built. In fact, there is no doubt that until the revolution and separation of church and state, brought about by the advent of American sovereignty, the church was in possession of the school in question, considering it as its own exclusive property.

Neither does the existence of a monument of Rizal on said land prove the ownership of the municipality of Misamis, nor can the recent occupation thereof be invoked as a title thereto. It should be interpreted as a tolerated possession in accordance with articles 444 and 447 of the Civil Code which in no way can be made the basis for the adjudication of a title.

The circumstance that these lands have been reversed for park purposes by Proclamation No. 360, dated February 7, 1931, is of no importance. Inasmuch as they were not public lands, lands of the public domain or lands particularly belonging to the Government, but properties of private ownership, they could not be lawfully segregated in order to be converted into public parks.

As stated in the beginning, the court found that lots Nos. 1, 2 and 3 are public plazas, as claimed by the municipality of Misamis, and decreed the registration thereof in the name of the said municipality. This decree is untenable. If they are public plazas they are not susceptible or registration in the name of any branch of the State. (Nicolas vs. Jose, 6 Phil., 589; Harty vs. Municipality of Victoria, 13 Phil., 152; 226 U.S., 12; 57 Law. ed., 103.)

For the foregoing considerations, and without the necessity of passing upon the various assignments of error of the appellant separately, the appealed judgment is reversed and it is ordered that the registration of lots Nos. 1, 2, 3 and 4 with the improvements thereof, except the Rizal monument, be decreed in favor of the Roman Catholic Bishop of Zamboanga, without costs. So ordered.

G.R. No. 69138 May 19, 1992

REPUBLIC OF THE PHILIPPINES (Bureau of Forest Development), petitioner, vs.INTERMEDIATE APPELLATE COURT (First Civil Cases Division) and HILARIO P. RAMA, respondents.

 

GUTIERREZ, JR., J.:

The decision of the trial court in this case declared the disputed parcels of land to be forest land and, therefore, inalienable. The appellate court sustained the factual finding. The issue raised in this petition refers to the propriety of awarding necessary expenses to the alleged possessor in good faith with right of retention until the expenses are paid.

In May 1974, Anselmo Logronio, in his official capacity as officer-in-charge of the Bohol Reforestation Project of the Bureau of Forest Development, bulldozed portions of two (2) parcels of land which he believed to be forest lands located at Talibon, Bohol, occupied the same, and planted mulberry and other trees.

Soon thereafter, respondent Hilario P. Rama commenced in the then Court of First Instance, now Regional Trial Court of Bohol, a complaint for recovery of possession, ownership and damages against Logronio alleging that he is the absolute owner and possessor of the two (2) parcels of land occupied by Logronio. He specifically described the two (2) parcels of land as follows:

A. A parcel of land, Lot 1, Psu-218360 beginning at a point marked "1" of Lot 1, Psu 218360, being N. 41-39 E., 15391.24 m. from B.L.L.M. No. 1, Municipality of Carmen, Province of Bohol, thence N. 47-35 W., 163.40 m. to point 2; S. 67-59 W., 173.82 m. to point 3; N.5-17 E., 250.71 m. to point 4; S. 71-33 E., 168.51 m. to point 5; S. 82-11 E., 107.55 m. to point 6; S. 0-45 W., 228.32 m. to point 1; point of beginning . . . containing an area of FIFTY ONE THOUSAND TWO HUNDRED AND TWENTY SIX (51,226) square meters . . . evidenced by Original Certificate of Title No. 6148 (Free Patent No. 319750) Office of the Register of Deeds for the Province of Bohol . . . also covered by Tax Dec. No. R-3859 in the name of Plaintiff . . . assessed at P990.00 . . .

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B. A parcel of land (as shown on plant H-154932, LRC Rec. No.), situated in the Barrio of Malitbog, Municipality of Trinidad, Province of Bohol. Bounded on the H., (sic) along lines 1-2-3 by the property of Rufino Autida (H-166571), on the E., along lines 4-5-6-7 by Creek; on the S., along lines 7-8-9-10, by the Marinas Creek 4.00 m. wide; on the W., along line 10-11 by Public Land (Forest Zone), and on the N., along lines 11-12-1 by the property of Angel Jumawan . . . containing an area of Ninety Six Thousand Three Hundred Forty Three (96,343) square meters . . . covered by Tax Dec. No. R-4019 in the name of Plaintiff . . . with an assessed value of Pl,390.00 . . .

xxx xxx xxx

(Record on Appeal, pp. 54-56)

In his answer, Logronio claimed that the two parcels of land are forest lands and that the questioned acts were performed by him in the regular and lawful performance of his duties as officer-in-charge of the Bohol Reforestation Project of the Bureau of Forest Development. He prayed for the dismissal of the complaint.

Petitioner Republic filed a motion for leave to intervene attaching its complaint-in-intervention.

The complaint-in-intervention alleged that Logronio's acts were authorized by the government through the Director of the Bureau of Forest Development in connection with the reforestation program of the government; that the two (2) subject parcels of land are located within the timberland Block D, L. C. Project No. 33 of Talibon, Bohol per BF Map L. C. 686 and, therefore, are forest lands; that the said lands were never released by the government as alienable and disposable lands, hence, are not susceptible of disposition or private appropriation under the provisions of the Public Land Act (Commonwealth Act No. 41), as amended, nor were the said parcels of land registered under the provisions of the Land Registration Law (Act No. 496), as amended. It prayed that Free Patent No. 319750 covering the forest portion of the first lot be declared null and void; that the Register of Deeds be ordered to cancel OCT No. 6148 covering the said forest portion; that both forest lands be reverted back to the public domain; and that the complaint against Logronio be dismissed.

The motion was granted and the complaint-in-intervention was admitted by the lower court.

Rama, then, filed an answer to the complaint-in-intervention alleging that the Republic has no cause of action, and is guilty of estoppel for having caused the issuance of the certificate of title covering the forest land. He claimed that if his title is to be cancelled, and he is deprived of ownership over the parcels of land, he should be paid by the Republic for all existing improvements plus whatever expenses he has incurred in connection with the improvement of said lands.

The trial of the case resulted in the following undisputed facts stated in the decision of the lower court:

xxx xxx xxx

1. On parcel A in the complaint. The evidence discloses that Lot 1, Psu-218360, as described in the complaint, and containing an area of 51,226 square meters, is one of the two lots covered by OCT No. 6148 (Free Patent Title No. 319750) in the name of Hilario Piscos Rama (Exhs. A and A-1) and is, according to the plaintiff, free from any liens or encumbrances.

Thus, plaintiff Hilario P. Rama, 42 testified that of the two parcels of land mentioned in the complaint, one parcel was covered by title, as shown by a xerox copy of OCT No. 6148 (Exhs. A and A-1), and by tax declaration No. R-3859 (Exh. B); that he secured a certification from the Office of the District Forester, Tagbilaran City, regarding the status of the land covered by OCT 6148 (Exh. C); that he had a plan of the land covered by OCT No. 6148 (Exh. D); that in the memorandum of encumbrances on OCT No. 6148 (Exh. A-1), Entry No. 3382 referred to a real-estate mortgage executed on 23 November 1967 by Hilario Piscos Rama and Socorro Regañon in favor of the Development Bank of the Philippines, but the obligation was already paid, and there was a written release of the mortgage in 1975, which was not yet registered because when he went to the Registry of Deeds payment was required for registering the release and he did not have money at that time.

As shown in OCT No. 6148 (Exh. A), the free patent title was given on 13 January 1967, and the certificate of title was issued on 4 May 1967. Then on 7 November 1967, the Office of the District Forester, Tagbilaran City, issued Certification No. 57 (Exh. C) to the effect "that according to the records of this Office, there is no pending case as far as the Bureau of Forestry is concerned, involving the validity of the title over a parcel of land containing an area of 10.2450 hectares covered by Original Certificate of Title No. 6148 Free Patent No. 319750 situated in barrio of Malitbog, Municipality of Dagohoy, Province of Bohol issued by the Register of Deeds of Tagbilaran City on January 13, 1967 in the name of Hilario Piscos Rama, Filipino, of legal age, married to Socorro Riganon, and resident in Malitbog, Dagohoy, Bohol."

Meantime, on 11 September 1967, Hipolito Amihan, Forester in Charge of the Bohol Reforestation Project, Dagohoy, Bohol, addressed a letter to the Administrator, Reforestation Administration, Diliman, Quezon City, thru the Regional Officer, Cebu City, (Exh. 8), stating that relative to OCT No. 6148 in the name of Hilario Piscos Rama —

Upon verification of the area in question it is found out that Lot I in an area of 51,226 sq. m. is within the area of Bohol Reforestation Project, Dagohoy, Bohol. . . .

and recommending "that Lot No. 1 under PSU-21-8360 with an area of 51,226 sq. m. under Free Patent No. 318750 issued in favor of Mr. Hilario Piscos Rama be cancelled."

On 29 October 1974, Lope D. Reyes, Assistant OIC, Legal Staff, Bureau of Forest Development, Diliman, Quezon City, sent a memorandum to the OIC Silviculture Division (Exh. 1), requesting that OCT No. 6148 issued in favor of

44

Hilario Piscos Rama "be verified as to whether or not the area is inside a timberland of alienable or disposable land." And on 22 November 1974, Primo P. Andres, Officer in Charge, Silviculture Division, Bureau of Forest Development, Diliman, Quezon City, returned by first endorsement (Exh. 2) the aforesaid memorandum with the information that per verification and control —

1. Lot 1, PSU-218360 is within the Timberland Block-A of LC Project No. 33 of Talibon, Bohol, per BF Map LC-635, and;

2. Lot 2, PSU-218360, is within the Alienable or Disposable Block-I, of LC Project 33 of Talibon, Bohol, certified as such on September 7, 1927, per BF Map LC-685.

And the Commissioner's Report (Exh. A-Commissioner) finds that —

On Lot 1, Psu-218360 and (sic) approximate area of 45,826 sq. m. colored green on the sketch is inside the Timberland and 5,400 sq. m. more or less is in the Alienable and Disposable Area.

And the Commissioner, Emmanuel Maboloc, 38, Junior Geodetic Engineer, Bureau of Forest Development, Region VII, Cebu City, testified to this effect, stating, however, that he did not make technical descriptions of the portion of the lot within the Bohol Reforestation Project and the portion outside it, so that, if required, he would have to go to the field again to make such technical descriptions. (Record on Appeal, pp. 61-65)

xxx xxx xxx

2. On parcel B in the complaint.— . . .

The land is covered by TD No. R-4019 in the name of plaintiff Hilario Piscos Rama (Exh. F) and was surveyed for the Heirs of German Remarata in 1952, as shown by the technical description (Exh. G) and plan H-154932 (Exh. H). But the land is not covered by any certificate of title.

On 12 March 1968, the Office of the District Forester, Tagbilaran City, issued Certification No. 90 (Exh. I) to the effect "that the parcel of land containing an approximate area of 9.6345 hectares situated in Barrio Malitbog, Municipality of Dagohoy, Province of Bohol, described in the Tax Declaration proposed in the name of German

Remarata, a resident of Bo. Malitbog, Dagohoy, Bohol was verified by a representative of this Office and was found to be within the Alienable and Disposable Block "1", Land Classification Project No. 33, Talibon, Bohol, L.C. Map No. 685, certified on September 7, 1927." And on 4 March 1970, the Office of the District Forester, City of Tagbilaran, thru Acting District Forester Pastor O. Ibarra, issued Certification No. 101 (Exh. J), which is similarly worded as Certification No. 90 (Exh. I), except that the proposed tax declaration is in the name of HILARIO PISCOS RAMA.

But on 15 May 1974, the Office of the District Forester, City of Tagbilaran, thru District Forester Pastor O. Ibarra, sent a letter to Hilario P. Rama (Exh. 4) informing him "that CERTIFICATION NO. 101, issued to you on March 4, 1970, by the District Forester of Tagbilaran City, is hereby revoked on the ground that after thorough (sic) investigation by representative of this Office the parcel of land which you claim and the subject matter in the above-mentioned CERTIFICATION NO. 101, is found to be within the Bohol Reforestation Project." And on the same date, a letter to the same effect was sent by District Forester Ibarra to the Provincial Assessor, City of Tagbilaran (Exh. 5).

The Commissioner's Report (Exh. A-Commissioner) inter alia states:

It was found out that on lot H-154932 an approximate area of 94,719 Sq. M. is inside Timberland block A, Project No. 33 a part of Bohol Reforestation Project (colored green on the sketch plan) and only approximately 1,624 Sq. M. is inside the Alienable and Disposable area colored orange on the sketch plan.

Likewise, Commissioner Maboloc declared that he did not make technical descriptions of the portion of said lot within the Bohol Reforestation Project and the portion outside it. (Record on Appeal, pp. 66-68)

In view of its findings that the two (2) subject parcels of land are forest lands, the lower court declared as null and void the Certificate of Title covering the first lot in the name of Rama and ordered him to vacate the said parcel "upon being reimbursed by the intervenor in the sum of SIX THOUSAND PESOS (P6,000.00) as necessary expenses." As regards the second parcel of land, the lower court ordered Rama to vacate the same parcel of land "with right to refund from the intervenor for the necessary expenses in the sum of THREE THOUSAND PESOS (P3,000.00), but without rights of retention." The dispositive portion of the decision reads:

WHEREFORE, judgment is hereby rendered, as follows:

45

1. Relative to Lot 1, Psu-218360, (parcel A in the complaint): declaring that portion thereof indicated in the Commissioner's Report (Exh. A-Commissioner) as having an "approximate area of 45,836 Sq. M. and shown on the sketch (Exh. B-Commissioner) as timberland and therefore part of the public domain (colored green, Parcel B in said sketch); declaring null and void Original Certificate of Title No. 6148 in the name of HILARIO PISCOS RAMA insofar as it includes the aforesaid portion; and ordering the plaintiff to vacate said portion upon being reimbursed by the intervenor in the sum of SIX THOUSAND PESOS (P6,000.00) as necessary expenses;

2. Relative to the parcel of land shown on plan H-154932 (parcel B in the complaint): declaring that the portion thereof indicated in the Commissioner's Report (Exh. A-Commissioner) as having "an approximate area of 94,719 Sq. M." and shown on the sketch (Exh. B-Commissioner) as timberland and therefore part of the public domain (colored green, Parcel A in said sketch); declaring null and void Tax Declaration No. R-4019 (Exh. F) insofar as it includes the aforesaid portion; and ordering the plaintiff to vacate said portion, with right to refund from the intervenor for the necessary expenses in the sum of THREE THOUSAND PESOS (P3,000.00), but without right of retention;

3. Dismissing the complaint as against defendant Anselmo Logroño, both in his private and in his official capacity;

4. Dismissing defendant Logroño's counterclaim; and

5. Ordering the Register of Deeds of the Province of Bohol to annotate the judgment relative to Lot 1, Psu-2l8360 at the back of Original Certificate of Title No. 6148.

Without pronouncement of costs.

(Record on Appeal, pp. 77-79)

Petitioner Republic appealed the lower court's decision to the then Intermediate Appellate Court, now Court of Appeals, insofar as it ordered petitioner Republic to pay Rama the necessary expenses with the right of retention over the titled parcel of land.

The appellate court, however, did not only affirm the questioned decision, but modified it by ruling that as regards the second parcel which is not covered by any certificate of title, Rama has also the right of retention until the necessary expenses awarded to him are paid by petitioner Republic.

A motion for reconsideration was denied. Hence, the instant petition.

In a resolution dated March 27, 1985, the Court gave due course to the petition. Because of the reorganization of the Court after the 1986 political upheaval and subsequent changes caused by retirement of certain Justices, the case could not be decided until its recent assignment to the undersigned ponente.

On May 5, 1989, we issued another resolution stating therein:

Considering the length of time that this case has remained pending and as a practical measure to ease the backlog of this Court, the parties shall, within ten (10) days from notice, MANIFEST whether or not they are still interested in prosecuting this case, or supervening events have transpired which render this case moot and academic or otherwise substantially affect the same. (Rollo, p. 70)

In response to this resolution, the Solicitor General, representing petitioner Republic, filed on August 4, 1989, a manifestation stating that he is not aware of any supervening event that may have transpired which would render the case moot and academic.

As stated earlier, the only issue in this petition is the propriety of awarding necessary expenses with right of retention over the two (2) parcels of land in favor of the possessor in this case, Rama, until the payment of the necessary expenses by petitioner Republic on the ground that Rama is a possessor in good faith as defined in Article 526 of the Civil Code.

In ruling that private respondent Rama, the possessor of the two forest lands is entitled to payment of necessary expenses, the appellate court cited the case of Dizon v. Rodriguez, (13 SCRA 704 [1965]).

The background facts of the Dizon case are as follows:

Hacienda Calatagan owned by Alfonso and Jacobo Zobel was originally covered by TCT No. T-722. In 1938, the Hacienda constructed a pier, called "Santiago Landing," about 600 meters long from the shore into the navigable waters of the Pagaspas Bay, to be used by vessels loading sugar produced by the Hacienda sugar mill. When the sugar mill ceased its operation in 1948, the owners of the Hacienda converted the pier into a fishpond dike and built additional strong dikes enclosing an area of about 30 hectares (of the Bay) and converted the same into a fishpond. The Hacienda owners also enclosed a similar area of about 37 hectares of the Bay on the other side of the pier which was also converted into a fishpond.

In 1949, the Zobels ordered the subdivision of the Hacienda by ordering the preparation of the subdivision plan Psd-27941 wherein fishpond No. 1 (with 30 hectares) was referred to as Lot No. 1 and fishpond No. 2 (with 37 hectares) was referred to as Lot No. 49. The plan was approved by the Director of Lands, and the Register of Deeds issued, from TCT No. T-722, TCT No. 2739 for lots 49 and 1 in the name of Jacobo Zobel.

In 1950, Jacobo Zobel sold to Antonino Dizon, et al. Lot 49 for which said purchasers obtained at first TCT No. T-2740 and later T-4718, Lot 1, on the other hand, was purchased by Carlos Goco, et al., who in turn, sold one-half thereof to Manuel Sy-Juco, et al. Transfer Certificate of Title No. 4159 was issued in the names of the Gocos and Sy-Jucos.

On May 24, 1952, Miguel Tolentino filed with the Bureau of Fisheries an

46

application for ordinary fishpond permit or lease for Lot 49, and an application for a similar permit, for Lot 1, was filed by his daughter Clemencia Tolentino.

The Dizons, Sy-Jucos, and Gocos filed a protest with the Bureau of Fisheries, claiming the properties to be private land covered by a certificate of title. This protest was dismissed by the Director of Fisheries, on the ground that the areas applied for are outside the boundaries of TCT No. T-722 of Hacienda Calatagan. This ruling was based upon the findings of the committee created by the Secretary of Agriculture and Natural Resources to look into the matter, that Lots 1 and 49 are not originally included within the boundaries of the hacienda.

On October 1, 1954, the protestants Dizons, Sy-Jucos, and Gocos filed an action in the Court of First Instance of Manila (Civ. Case No. 24237) to restrain the Director of Fisheries from issuing the fishpond permits applied for by the Tolentinos. The court dismissed this petition for non-exhaustion of administrative remedy, it appearing that petitioners had not appealed from the decision of the Director of Fisheries to the Secretary of Agriculture and Natural Resources. On appeal to this Court, the decision of the lower court was sustained (G.R. No. 8654, promulgated April 28, 1956). The protestants then filed an appeal with the Secretary of Agriculture and Natural Resources. This time, the same was dismissed for being filed out of time.

On August 16, 1956, the Dizons filed Civil Case 135 and the Sy-Jucos and Gocos, Civil Case 136, in the Court of First Instance of Batangas, to quiet their titles over Lots 49 and 1. Named defendants were the Secretary of Agriculture and Natural Resources and applicants Tolentinos. The Republic of the Philippines was allowed to intervene in view of the finding by the investigating committee created by the respondent Secretary, that the lots were part of the foreshore area before their conversion into fishponds by the hacienda-owners.

On January 30, 1958, after due hearing, the Court of First Instance of Batangas promulgated a joint decision making the finding, among others, that the subdivision plan Psd-27941 was prepared in disregard of the technical description stated in TCT No. T-722, because the surveyor merely followed the existing shoreline and placed his monuments on the southwest lateral of Lot 49, which was the pier abutting into the sea; and made the conclusion that Lots 1 and 49 of Psd-27941 were part of the foreshore lands. As the certificate of title obtained by petitioners covered lands not subject to registration, the same were declared null and void, and Lots 1 and 49 were declared properties of the public domain. Petitioners appealed to the Court of Appeals.

In its decision of October 31, 1961, as well as the resolution of August 20, 1962, the appellate court adopted the findings of the lower court, that the lots in question are part of the foreshore area and affirmed the ruling cancelling

the titles to plaintiffs. Although in the decision of October 31, 1961, the Court of Appeals awarded to applicants Tolentinos damages in the amount of P200.00 per hectare from October 1, 1954, when plaintiffs were notified of the denial of their protest by the Director of Fisheries, such award was eliminated in the resolution of August 20, 1962, for reason that plaintiffs, who relied on the efficacy of their certificates of title, cannot be considered possessors in bad faith until after the legality of their said titles has been finally determined. Appellants were thus declared entitled to retention of the properties until they are reimbursed by the landowner, the Republic of the Philippines, of the necessary expenses made on the lands, in the sums of P40,000.00 (for Lot 49) and P25,000.00 (for Lot 1). It is from this portion of the decision as thus modified that defendants Tolentinos and the intervenor Republic of the Philippines appealed (in G.R. Nos. L-20355-56), claiming that plaintiffs' possession became in bad faith when their protest against the application for lease was denied by the Director of Fisheries. In addition, the intervenor contends that being such possessors in bad faith, plaintiffs are not entitled to reimbursement of the expenses made on the properties. (at pp. 705-708; Emphasis supplied)

The appellate court's decision was appealed to us by both the Republic and the Dizons, et al.

We dismissed both appeals.

A comparative study of the present case and the Dizon case shows different circumstances which make the Dizon case not applicable to the instant case.

In the present case, the parcel of land titled in the name of Hilario P. Rama is covered by an original torrens title issued in Rama's name on May 4, 1967. Earlier, he applied for the issuance of title based on a patent which was given on January 13, 1967. The fact that he applied for a patent title shows a recognition on his part that the parcel is part of the public domain. True, government officials caused the issuance of the patent title and the original torrens title covering the land in Rama's name. However, the well-entrenched principle is that the State cannot be put in estoppel by the mistakes or errors of its officials or agents. (Republic v. Court of Appeals, 135 SCRA 156 [1985]; and Republic v. Aquino, 120 SCRA 186 [1983])

Considering that the subject parcel of land is forest land, the patent and original certificate of title covering the subject parcel issued to Rama did not confer any validity to his possession or claim of ownership. (Sunbeam Convenience Foods, Inc. v. Court of Appeals, 181 SCRA 443 [1990]; Vallarta v. Intermediate Appellate Court, 151 SCRA 679 [1987]; Republic v. Court of Appeals, 148 SCRA 480 [1987]; Republic v. Court of Appeals, 135 SCRA 156 [1985])

The titles are void ab initio. (Heirs of Amunategui v. Director of Forestry, 126 SCRA 69 [1983]; Republic v. Animas, 56 SCRA 499 [1974]) The titles issued cannot ripen into private ownership. (Director of Forestry v. Muñoz, 23 SCRA 1183 [1968]; Heirs of Amunategui v. Director of Forestry, supra; Vallarta v. Intermediate Appellate Court, supra) In effect, Rama's possession of the parcel from the beginning was fraudulent and illegal. He was merely a squatter on the parcel. Under these circumstances, we cannot see any reason why Rama should be considered a possessor in good faith as defined in Article 526 of the Civil Code.

In the Dizon case, however, the occupants of the parcels of land which were adjudged as part of these ashore or

47

foreshore area and part of the public domain bought the land from Alfonso and Jacobo Zobel relying on the original certificate of title covering the parcels. This intervening event constitutes the difference between the Dizon case and the present case. Dizon, et al. buyers of the foreshore lands were protected by the principle that an innocent buyer of a registered land may rely on the torrens title of the seller. In the absence of anything to excite suspicion, the buyer is not obligated to look beyond the certificate to investigate the title of the sellers appearing on the face of the certificate. (Philippine National Bank v. Court of Appeals, 187 SCRA 735 [1990]; Gonzales v. Intermediate Appellate Court, 157 SCRA 587 [1988]; Philippine National Cooperative Bank v. Carandang-Villalon, 139 SCRA 570 [1985]); Penullar v. Philippine National Bank, 120 SCRA 171 [1983])

Another distinction between the two (2) cases is in the degree of participation of the parties and the public officials in the titling of the subject parcels of land. In the present case, respondent Rama was the one who secured a certificate from the office of the District Forester, Tagbilaran City as regards the status of the parcel of land with his representations that "he had a plan of the land." It appears, therefore, that it was through the representations of Rama that the land was titled in his name. Some months later, however, or on November 7, 1967, the Office of the District Forester suspected that the parcel of land thus titled was forest land. Why this angle was not pursued is not shown in the records. It, however, negates the good faith of Rama who actively pursued the titling of the parcel in his name.

Good faith which entitles the possessors to necessary expenses with right of retention until reimbursement was explained in the Dizon case:

On the matter of possession of plaintiffs-appellants, the ruling of the Court of Appeals must be upheld. There is no showing that plaintiffs are not purchasers in good faith and for value. As such titleholders, they have reason to rely on the indefeasible character of their certificates.

On the issue of good faith of the plaintiffs, the Court of Appeals reasoned out:

The concept of possessors in good faith given in Art. 526 of the Civil Code and when said possession loses this Character under Art. 528, needs to be reconciled with the doctrine of indefeasibility of a Torrens Title. Such reconcialiton can only be achieved by holding that the possessor with a Torrens Title is not aware of any flaw in his Title which invalidates it until his Torrens Title is declared null and void by final judgment of the Courts.

Even if the doctrine of indefeasibility of a Torrens Title were not thus reconciled, the result would be the same, considering the

third paragraph of Art. 526 which provides that:

Art. 526. . . .

Mistake upon a doubtful or difficult question of law may be the basis of good faith.

The legal question whether plaintiffs-appellants' possession in good faith, under their Torrens Titles acquired in good faith, does not lose this character except in the case and from the moment their Titles are declared null and void by the Courts, is a difficult one. Even the members of this Court were for a long time divided, two to one, on the answer. It was only after several sessions, where the results of exhaustive researches on both sides were thoroughly discussed, that an undivided Court finally found the answer given in the next preceding paragraph. Hence, even if it be assumed for the sake of argument that the Supreme Court would find that the law is not as we have stated it in the next preceding paragraph and that the plaintiffs-appellants made a mistake in relying thereon, such mistake on a difficult question of law may be the basis of good faith. Hence, their possession in good faith does not lose this character except in the case and from the moment their Torrens Titles are declared null and void by the Courts.

Under the circumstances of the case, especially where the subdivision plan was originally approved by the Director of Lands, we are not ready to conclude that the above reasoning of the Court of Appeals on this point is a reversible error. Needless to state, as such occupants in good faith, plaintiffs have the right to the retention of the property

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until they are reimbursed the necessary expenses made on the lands.

With respect to the contention of the Republic of the Philippines that the order for the reimbursement by it of such necessary expenses constitutes a judgment against the government in a suit not consented to by it, suffice it to say that the Republic, on its own initiative, asked and was permitted to intervene in the case and thereby submitted itself voluntarily to the jurisdiction of the court. (at pp. 709-710; Emphasis supplied)

With the foregoing findings, the appellate court's ruling as regards the unregistered parcel of land which is to the effect that Rama is also entitled to necessary expenses with right of retention until reimbursed of the necessary expenses must be reversed. His title over the forest land is null and void for the same reasons. There are no special circumstances which would warrant the application of the Dizon case.

WHEREFORE, the petition is GRANTED. The questioned decision and resolution of the then Intermediate Appellate Court, now Court of Appeals, are SET ASIDE in so far as they ordered petitioner Republic to pay private respondent Hilario P. Rama the necessary expenses incurred by him, with right of retention over the two (2) parcels of land adjudged as forest lands until reimbursed of the necessary expenses. The decision of the then Court of First Instance of Bohol (now Regional Trial Court of Bohol) in Civil Case No. 2613 is MODIFIED in that the portion of the decision which ordered petitioner Republic to pay private respondent Hilario P. Rama necessary expenses with right of retention in parcel number one described in the complaint is DELETED. In all other respects, the questioned decision and resolution are AFFIRMED. No costs.

SO ORDERED.

G.R. No. 92161 March 18, 1991

SIMPLICIO BINALAY, PONCIANO GANNABAN, NICANOR MACUTAY, DOMINGO ROSALES, GREGORIO ARGONZA, EUSTAQUIO BAUA, FLORENTINO ROSALES, TEODORO MABBORANG, PATRICIO MABBORANG and FULGENCIO MORA, petitionersvs.GUILLERMO MANALO and COURT OF APPEALS, respondents.

Josefin De Alban Law Office for Petitioners.

 

FELICIANO, J.:p

The late Judge Taccad originally owned a parcel of land situated in Tumauini, Isabela having an estimated area of twenty (20) hectares. The western portion of this land bordering on the Cagayan River has an elevation lower than that of the eastern portion which borders on the national road. Through the years, the western portion would periodically go under the waters of the Cagayan River as those waters swelled with the coming of the rains. The submerged portion, however, would re-appear during the dry season from January to August. It would remain under water for the rest of the year, that is, from September to December during the rainy season.

The ownership of the landholding eventually moved from one person to another. On 9 May 1959, respondent Guillermo Manalo acquired 8.65 hectares thereof from Faustina Taccad, daughter of Judge Juan Taccad. The land sold was described in the Deed of Absolute Sale 1 as follows:

. . . a parcel of agricultural land in Balug, Tumauini, Isabela, containing an area of 8.6500 hectares, more or less; bounded on the North by Francisco Forto on the East by National Road; on South by Julian Tumolva and on the West by Cagayan River; declared for taxation under Tax Declaration No. 12681 in the name of Faustina Taccad, and assessed at P 750.00. . . .

Later in 1964, respondent Manalo purchased another 1.80 hectares from Gregorio Taguba who had earlier acquired the same from Judge Juan Taccad. The second purchase brought the total acquisition of respondent Manalo to 10.45 hectares. The second piece of property was more particularly described as follows:

. . . a piece of agricultural land consisting of tobacco land, and containing an area of 18,000 square meters, more or less, bounded on the North by Balug Creek; on the South, by Faustina Taccad (now Guillermo R. Manalo); on the East, by a Provincial Road; and on the West, by Cagayan River assessed at P 440.00, as tax Declaration No. 3152. . . . 2

During the cadastral survey conducted at Balug, Tumauini, Isabela on 21 October 1969, the two (2) parcels of land belonging to respondent Manalo were surveyed and consolidated into one lot, designated as Lot No. 307, Pls-964. Lot 307 which contains 4.6489 hectares includes: (a) the whole of the 1.80 hectares acquired from Gregorio Taguba; and (b) 2.8489 hectares out of the 8.65 hectares purchased from Faustina Taccad. As the survey was conducted on a rainy month, a portion of the land bought from Faustina Taccad then under water was left unsurveyed and was not included in Lot 307.

The Sketch Plan 3 submitted during the trial of this case and which was identified by respondent Manalo shows that the Cagayan River running from south to north, forks at a certain point to form two (2) branches—the western and the eastern branches—and then unites at the other end, further north, to form a narrow strip of land. The eastern branch of the river cuts through the land of respondent Manalo and is inundated with water only during the rainy season. The bed of the eastern branch is the submerged or the unsurveyed portion of the land belonging to respondent Manalo. For about eight (8) months of the year when the level of water at the point where the Cagayan River forks is at its ordinary depth, river water does not flow into the eastern branch. While this condition persists, the eastern bed is dry and is susceptible to cultivation.

Considering that water flowed through the eastern branch of the Cagayan River when the cadastral survey was conducted, the elongated strip of land formed by the western and the eastern branches of the Cagayan River looked very much like an island. This strip of land was surveyed on 12 December 1969. 4 It was found to have a total area of 22.7209 hectares and was designated as Lot 821 and Lot 822. The area of Lot 822 is 10.8122 hectares while Lot 821 has an area of 11.9087 hectares. Lot 821 is located directly opposite Lot 307 and is separated from the latter only by the eastern branch of the Cagayan River during the rainy season and, during the dry season, by the exposed, dry river bed, being a portion of the land bought from Faustina Taccad. Respondent Manalo claims that Lot 821 also belongs to him by way of accretion to the submerged portion of the property to which it is adjacent.

Petitioners who are in possession of Lot 821, upon the other hand, insist that they own Lot 821. They occupy the outer edges of Lot 821 along the river banks, i.e., the fertile portions on which they plant tobacco and other agricultural products. They also cultivate the western strip of the unsurveyed portion during summer. 5 This situation compelled respondent Manalo to file a case for forcible entry against petitioners on 20 May 1969. The case was

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dismissed by the Municipal Court of Tumauini, Isabela for failure of both parties to appear. On 15 December 1972, respondent Manalo again filed a case for forcible entry against petitioners. The latter case was similarly dismissed for lack of jurisdiction by the Municipal Court of Tumauini, Isabela.

On 24 July 1974, respondent Manalo filed a complaints 6 before the then Court of First Instance of Isabela, Branch 3 for quieting of title, possession and damages against petitioners. He alleged ownership of the two (2) parcels of land he bought separately from Faustina Taccad and Gregorio Taguba for which reason he prayed that judgment be entered ordering petitioners to vacate the western strip of the unsurveyed portion. Respondent Manalo likewise prayed that judgment be entered declaring him as owner of Lot 821 on which he had laid his claim during the survey.

Petitioners filed their answer denying the material allegations of the complaint. The case was then set for trial for failure of the parties to reach an amicable agreement or to enter into a stipulation of facts. 7 On 10 November 1982, the trial court rendered a decision with the following dispositive portion:

WHEREFORE, in the light of the foregoing premises, the Court renders judgment against the defendants and in favor of the plaintiff and orders:

1. That plaintiff, Guillermo Manalo, is declared the lawful owner of the land in question, Lot No. 821, Pls-964 of Tumauini Cadastre, and which is more particularly described in paragraph 2-b of the Complaint;

2. That the defendants are hereby ordered to vacate the premises of the land in question, Lot No. 821, Pls-964 of Tumauini Cadastre, and which is more particularly described in paragraph 2-b of the Complaint;

3. That the defendants are being restrained from entering the premises of the land in question, Lot No. 821, Pls-964 of Tumauini Cadastre, and which is more particularly described in paragraph 2-b of the Complaint; and

4. That there is no pronouncement as to attorney's fees and costs.

SO ORDERED. 8

Petitioners appealed to the Court of Appeals which, however, affirmed the decision of the trial court. They filed a motion for reconsideration, without success.

While petitioners insist that Lot 821 is part of an island surrounded by the two (2) branches of the Cagayan River, the Court of Appeals found otherwise. The Court of Appeals concurred with the finding of the trial court that Lot 821 cannot be considered separate and distinct from Lot 307 since the eastern branch of the Cagayan River substantially dries up for the most part of the year such that when this happens, Lot 821 becomes physically (i.e., by land) connected with the dried up bed owned by respondent Manalo. Both courts below in effect rejected the assertion of petitioners that the depression on the earth's surface which separates Lot 307 and Lot 821 is, during part of the year, the bed of the eastern branch of the Cagayan River.

It is a familiar rule that the findings of facts of the trial court are entitled to great respect, and that they carry even more weight when affirmed by the Court of Appeals. 9 This is in recognition of the peculiar advantage on the part of the trial court of being able to observe first-hand the deportment of the witnesses while testifying. Jurisprudence is likewise settled that the Court of Appeals is the final arbiter of

questions of fact. 10 But whether a conclusion drawn from such findings of facts is correct, is a question of law cognizable by this Court. 11

In the instant case, the conclusion reached by both courts below apparently collides with their findings that periodically at the onset of and during the rainy season, river water flows through the eastern bed of the Cagayan River. The trial court held:

The Court believes that the land in controversy is of the nature and character of alluvion (Accretion), for it appears that during the dry season, the body of water separating the same land in controversy (Lot No. 821, Pls-964) and the two (2) parcels of land which the plaintiff purchased from Gregorio Taguba and Justina Taccad Cayaba becomes a marshy land and is only six (6) inches deep and twelve (12) meters in width at its widest in the northern tip (Exhs. "W", "W-l", "W-2", "W-3" and "W-4"), It has been held by our Supreme Court that "the owner of the riparian land which receives the gradual deposits of alluvion, does not have to make an express act of possession. The law does not require it, and the deposit created by the current of the water becomes manifest" (Roxas vs. Tuazon, 6 Phil. 408). 12

The Court of Appeals adhered substantially to the conclusion reached by the trial court, thus:

As found by the trial court, the disputed property is not an island in the strict sense of the word since the eastern portion of the said property claimed by appellants to be part of the Cagayan River dries up during summer. Admittedly, it is the action of the heavy rains which comes during rainy season especially from September to November which increases the water level of the Cagayan river. As the river becomes swollen due to heavy rains, the lower portion of the said strip of land located at its southernmost point would be inundated with water. This is where the water of the Cagayan river gains its entry. Consequently, if the water level is high the whole strip of land would be under water.

In Government of the Philippine Islands vs. Colegio de San Jose, it was held that —

According to the foregoing definition of the words "ordinary" and "extra-ordinary," the highest depth of the waters of Laguna de Bay during the dry season is the ordinary one, and the highest depth they attain during the extra-ordinary one (sic); inasmuch as the former is the one which is regular, common, natural, which occurs always or most of the time during the year, while the latter is uncommon,

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transcends the general rule, order and measure, and goes beyond that which is the ordinary depth. If according to the definition given by Article 74 of the Law of Waters quoted above, the natural bed or basin of the lakes is the ground covered by their waters when at their highest ordinary depth, the natural bed or basin of Laguna de Bay is the ground covered by its waters when at their highest depth during the dry season, that is up to the northeastern boundary of the two parcels of land in question.

We find the foregoing ruling to be analogous to the case at bar. The highest ordinary level of the waters of the Cagayan River is that attained during the dry season which is confined only on the west side of Lot [821] and Lot [822]. This is the natural Cagayan river itself. The small residual of water between Lot [821] and 307 is part of the small stream already in existence when the whole of the late Judge Juan Taccad's property was still susceptible to cultivation and uneroded. 13

The Court is unable to agree with the Court of Appeals that Government of the Philippine Islands vs. Colegio de San Jose 14 is applicable to the present case. That case involved Laguna de Bay; since Laguna de Bay is a lake, the Court applied the legal provisions governing the ownership and use of lakes and their beds and shores, in order to determine the character and ownership of the disputed property. Specifically, the Court applied the definition of the natural bed or basin of lakes found in Article 74 of the Law of Waters of 3 August 1866. Upon the other hand, what is involved in the instant case is the eastern bed of the Cagayan River.

We believe and so hold that Article 70 of the Law of Waters of 3 August 1866 is the law applicable to the case at bar:

Art. 70. The natural bed or channel of a creek or river is the ground covered by its waters during the highest floods. (Emphasis supplied)

We note that Article 70 defines the natural bed or channel of a creek or river as the ground covered by its waters during the highest floods. The highest floods in the eastern branch of the Cagayan River occur with the annual coming of the rains as the river waters in their onward course cover the entire depressed portion. Though the eastern bed substantially dries up for the most part of the year (i.e., from January to August), we cannot ignore the periodical swelling of the waters ( i.e., from September to December) causing the eastern bed to be covered with flowing river waters.

The conclusion of this Court that the depressed portion is a river bed rests upon evidence of record. Firstly, respondent Manalo admitted in open court that the entire area he bought from Gregorio Taguba was included in Lot 307. 15 If the 1.80 hectares purchased from Gregorio Taguba was included in

Lot 307, then the Cagayan River referred to as the western boundary in the Deed of Sale transferring the land from Gregorio Taguba to respondent Manalo as well as the Deed of Sale signed by Faustina Taccad, must refer to the dried up bed (during the dry months) or the eastern branch of the river (during the rainy months). In the Sketch Plan attached to the records of the case, Lot 307 is separated from the western branch of the Cagayan River by a large tract of land which includes not only Lot 821 but also what this Court characterizes as the eastern branch of the Cagayan River.

Secondly, the pictures identified by respondent Manalo during his direct examination depict the depressed portion as a river bed. The pictures, marked as Exhibits "W" to "W-4", were taken in July 1973 or at a time when the eastern bed becomes visible. 16 Thus, Exhibit "W-2" which according to respondent Manalo was taken facing the east and Exhibit "W-3" which was taken facing the west both show that the visible, dried up portion has a markedly lower elevation than Lot 307 and Lot 821. It has dike-like slopes on both sides connecting it to Lot 307 and Lot 821 that are vertical upward and very prominent. This topographic feature is compatible with the fact that a huge volume of water passes through the eastern bed regularly during the rainy season. In addition, petitioner Ponciano Gannaban testified that one had to go down what he called a "cliff" from the surveyed portion of the land of respondent Manalo to the depressed portion. The cliff, as related by petitioner Gannaban, has a height of eight (8) meters. 17

The records do not show when the Cagayan River began to carve its eastern channel on the surface of the earth. However, Exhibit "E" 18 for the prosecution which was the Declaration of Real Property standing in the name of Faustina Taccad indicates that the eastern bed already existed even before the sale to respondent Manalo. The words "old bed" enclosed in parentheses—perhaps written to make legitimate the claim of private ownership over the submerged portion—is an implied admission of the existence of the river bed. In the Declaration of Real Property made by respondent Manalo, the depressed portion assumed the name Rio Muerte de Cagayan. Indeed, the steep dike-like slopes on either side of the eastern bed could have been formed only after a prolonged period of time.

Now, then, pursuant to Article 420 of the Civil Code, respondent Manalo did not acquire private ownership of the bed of the eastern branch of the river even if it was included in the deeds of absolute sale executed by Gregorio Taguba and Faustina Taccad in his favor. These vendors could not have validly sold land that constituted property of public dominion. Article 420 of the Civil Code states:

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. (Emphasis supplied)

Although Article 420 speaks only of rivers and banks, "rivers" is a composite term which includes: (1) the running waters, (2) the bed, and (3) the banks. 19 Manresa, in commenting upon Article 339 of the Spanish Civil Code of 1889 from which Article 420 of the Philippine Civil Code was taken, stressed the public ownership of river beds:

La naturaleza especial de los rios, en punto a su disfrute general, hace que sea necesario considerar en su relacion de dominio algo mas que sus aguas corrientes. En efecto en todo rio es preciso distinguir 1. esta agua corriente;

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2. el alveo o cauce, y 3. las riberas. Ahora bien: son estas dos ultimas cosas siempre de dominio publico, como las aguas?

Realmente no puede imaginarse un rio sin alveo y sin ribera; de suerte que al decir el Codigo civil que los rios son de dominio publico, parece que debe ir implicito el dominio publico de aquellos tres elementos que integran el rio. Por otra parte, en cuanto a los alveos o cauces tenemos la declaracion del art. 407, num 1, donde dice: son de dominion publico . . . los rios y sus cauces naturales; declaracion que concuerda con lo que dispone el art. 34 de la ley de [Aguas], segun el cual, son de dominion publico: 1. los alveos o cauces de los arroyos que no se hallen comprendidos en el art. 33, y 2. los alveos o cauces naturales de los rios en la extension que cubran sus aguas en las mayores crecidas ordinarias. 20 (Emphasis supplied)

The claim of ownership of respondent Manalo over the submerged portion is bereft of basis even if it were alleged and proved that the Cagayan River first began to encroach on his property after the purchase from Gregorio Taguba and Faustina Taccad. Article 462 of the Civil Code would then apply divesting, by operation of law, respondent Manalo of private ownership over the new river bed. The intrusion of the eastern branch of the Cagayan River into his landholding obviously prejudiced respondent Manalo but this is a common occurrence since estates bordering on rivers are exposed to floods and other evils produced by the destructive force of the waters. That loss is compensated by, inter alia, the right of accretion acknowledged by Article 457 of the Civil Code. 21 It so happened that instead of increasing the size of Lot 307, the eastern branch of the Cagayan River had carved a channel on it.

We turn next to the issue of accretion. After examining the records of the case, the Court considers that there was no evidence to prove that Lot 821 is an increment to Lot 307 and the bed of the eastern branch of the river. Accretion as a mode of acquiring property under Article 457 of the Civil Code requires the concurrence of three (3) requisites: (a) that the deposition of soil or sediment be gradual and imperceptible; (b) that it be the result of the action of the waters of the river (or sea); and (c) that the land where accretion takes place is adjacent to the banks of rivers (or the sea coast). 22 The Court notes that the parcels of land bought by respondent Manalo border on the eastern branch of the Cagayan River. Any accretion formed by this eastern branch which respondent Manalo may claim must be deposited on or attached to Lot 307. As it is, the claimed accretion (Lot 821) lies on the bank of the river not adjacent to Lot 307 but directly opposite Lot 307 across the river.

Assuming (arguendo only) that the Cagayan River referred to in the Deeds of Sale transferring ownership of the land to respondent Manalo is the western branch, the decision of the Court of Appeals and of the trial court are bare of factual findings to the effect that the land purchased by respondent Manalo received alluvium from the action of the aver in a slow and gradual manner. On the contrary, the decision of the lower court made mention of several floods that caused the land to reappear making it susceptible to cultivation. A sudden and forceful action like that of flooding is hardly the alluvial process contemplated under Article 457 of the Civil Code. It is the slow and hardly perceptible accumulation of soil deposits that the law grants to the riparian owner.

Besides, it is important to note that Lot 821 has an area of 11.91 hectares. Lot 821 is the northern portion of the strip of land having a total area of 22.72 hectares. We find it difficult to suppose that such a sizable area as Lot 821 resulted from slow accretion to another lot of almost equal size. The total landholding purchased by respondent Manalo is 10.45 hectares (8.65 hectares from Faustina Taccad and 1.80 hectares from Gregorio Taguba in 1959 and 1964,

respectively), in fact even smaller than Lot 821 which he claims by way of accretion. The cadastral survey showing that Lot 821 has an area of 11.91 hectares was conducted in 1969. If respondent Manalo's contention were accepted, it would mean that in a span of only ten (10) years, he had more than doubled his landholding by what the Court of Appeals and the trial court considered as accretion. As already noted, there are steep vertical dike-like slopes separating the depressed portion or river bed and Lot 821 and Lot 307. This topography of the land, among other things, precludes a reasonable conclusion that Lot 821 is an increment to the depressed portion by reason of the slow and constant action of the waters of either the western or the eastern branches of the Cagayan River.

We turn finally to the issue of ownership of Lot 821. Respondent Manalo's claim over Lot 821 rests on accretion coupled with alleged prior possession. He alleged that the parcels of land he bought separately from Gregorio Taguba and Faustina Taccad were formerly owned by Judge Juan Taccad who was in possession thereof through his (Judge Taccad's) tenants. When ownership was transferred to him, respondent Manalo took over the cultivation of the property and had it declared for taxation purposes in his name. When petitioners forcibly entered into his property, he twice instituted the appropriate action before the Municipal Trial Court of Tumauini, Isabela. Against respondent Manalo's allegation of prior possession, petitioners presented tax declarations standing in their respective names. They claimed lawful, peaceful and adverse possession of Lot 821 since 1955.

If respondent Manalo had proved prior possession, it was limited physically to Lot 307 and the depressed portion or the eastern river bed. The testimony of Dominga Malana who was a tenant for Justina Taccad did not indicate that she was also cultivating Lot 821. In fact, the complaints for forcible entry lodged before the Municipal Trial Court of Tumauini, Isabela pertained only to Lot 307 and the depressed portion or river bed and not to Lot 821. In the same manner, the tax declarations presented by petitioners conflict with those of respondent Manalo. Under Article 477 of the Civil Code, the plaintiff in an action for quieting of title must at least have equitable title to or interest in the real property which is the subject matter of the action. The evidence of record on this point is less than satisfactory and the Court feels compelled to refrain from determining the ownership and possession of Lot 821, adjudging neither petitioners nor respondent Manalo as owner(s) thereof.

WHEREFORE, the Decision and Resolution of the Court of Appeals in CA-GR CV No. 04892 are hereby SET ASIDE. Respondent Manalo is hereby declared the owner of Lot 307. The regularly submerged portion or the eastern bed of the Cagayan River is hereby DECLARED to be property of public dominion. The ownership of Lot 821 shall be determined in an appropriate action that may be instituted by the interested parties inter se. No pronouncement as to costs.

SO ORDERED.

G.R. No. 134209             January 24, 2006

REPUBLIC OF THE PHILIPPINES, Petitioner, vs.CELESTINA NAGUIAT, Respondent.

D E C I S I O N

GARCIA, J.:

Before the Court is this petition for review under Rule 45 of the Rules of Court seeking the reversal of the Decision1 dated May 29, 1998 of the Court of Appeals (CA) in CA-G.R. CV No. 37001 which affirmed an earlier decision2 of the Regional Trial Court at Iba, Zambales, Branch 69 in Land Registration Case No. N-25-1.

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The decision under review recites the factual backdrop, as follows:

This is an application for registration of title to four (4) parcels of land located in Panan, Botolan, Zambales, more particularly described in the amended application filed by Celestina Naguiat on 29 December 1989 with the Regional Trial Court of Zambales, Branch 69. Applicant [herein respondent] alleges, inter alia, that she is the owner of the said parcels of land having acquired them by purchase from the LID Corporation which likewise acquired the same from Demetria Calderon, Josefina Moraga and Fausto Monje and their predecessors-in-interest who have been in possession thereof for more than thirty (30) years; and that to the best of her knowledge, said lots suffer no mortgage or encumbrance of whatever kind nor is there any person having any interest, legal or equitable, or in possession thereof.

On 29 June 1990, the Republic of the Philippines [herein petitioner]. . . filed an opposition to the application on the ground that neither the applicant nor her predecessors-in interest have been in open, continuous, exclusive and notorious possession and occupation of the lands in question since 12 June 1945 or prior thereto; that the muniments of title and tax payment receipts of applicant do not constitute competent and sufficient evidence of a bona-fide acquisition of the lands applied for or of his open, continuous, exclusive and notorious possession and occupation thereof in the concept of (an) owner; that the applicant’s claim of ownership in fee simple on the basis of Spanish title or grant can no longer be availed of . . .; and that the parcels of land applied for are part of the public domain belonging to the Republic of the Philippines not subject to private appropriation.

On 15 October 1990, the lower court issued an order of general default as against the whole world, with the exception of the Office of the Solicitor General, and proceeded with the hearing of this registration case.

After she had presented and formally offered her evidence . . . applicant rested her case. The Solicitor General, thru the Provincial Prosecutor, interposed no objection to the admission of the exhibits. Later . . . the Provincial Prosecutor manifest (sic) that the Government had no evidence to adduce. 3

In a decision4 dated September 30, 1991, the trial court rendered judgment for herein respondent Celestina Naguiat, adjudicating unto her the parcels of land in question and decreeing the registration thereof in her name, thus:

WHEREFORE, premises considered, this Court hereby adjudicates the parcels of land situated in Panan, Botolan, Zambales, appearing on Plan AP-03-003447 containing an area of 3,131 square meters, appearing on Plan AP-03-003446 containing an area of 15,322 containing an area of 15,387 square meters to herein applicant Celestina T. Naguiat, of legal age, Filipino citizen, married to Rommel Naguiat and a resident of Angeles City, Pampanga together with all the improvements existing thereon and orders and decrees registration in her name in accordance with Act No. 496, Commonwealth Act No. 14, [should be 141] as amended, and Presidential Decree No. 1529. This adjudication, however, is subject to the various easements/reservations provided for under pertinent laws, presidential decrees and/or presidential letters of instructions which should be annotated/ projected on the title to be issued. And once this decision becomes final, let the corresponding decree of registration be immediately issued. (Words in bracket added)

With its motion for reconsideration having been denied by the trial court, petitioner Republic went on appeal to the CA in CA-G.R. CV No. 37001.

As stated at the outset hereof, the CA, in the herein assailed decision of May 29, 1998, affirmed that of the trial court, to wit:

WHEREFORE, premises considered, the decision appealed from is hereby AFFIRMED.

SO ORDERED.

Hence, the Republic’s present recourse on its basic submission that the CA’s decision "is not in accordance with law, jurisprudence and the evidence, since respondent has not established with the required evidence her title in fee simple or imperfect title in respect of the subject lots which would warrant their registration under … (P.D. 1529 or Public Land Act (C.A.) 141." In particular, petitioner Republic faults the appellate court on its finding respecting the length of respondent’s occupation of the property subject of her application for registration and for not considering the fact that she has not established that the lands in question have been declassified from forest or timber zone to alienable and disposable property.

Public forest lands or forest reserves, unless declassified and released by positive act of the Government so that they may form part of the disposable agricultural lands of the public domain, are not capable of private appropriation.5 As to these assets, the rules on confirmation of imperfect title do not apply.6 Given this postulate, the principal issue to be addressed turns on the question of whether or not the areas in question have ceased to have the status of forest or other inalienable lands of the public domain.

Forests, in the context of both the Public Land Act7 and the Constitution8 classifying lands of the public domain into "agricultural, forest or timber, mineral lands and national parks," do not necessarily refer to a large tract of wooded land or an expanse covered by dense growth of trees and underbrush. As we stated in Heirs of Amunategui 9-

A forested area classified as forest land of the public domain does not lose such classification simply because loggers or settlers have stripped it of its forest cover. Parcels of land classified as forest land may actually be covered with grass or planted to crops by kaingin cultivators or other farmers. "Forest lands" do not have to be on mountains or in out of the way places. xxx. The classification is merely descriptive of its legal nature or status and does not have to be descriptive of what the land actually looks like. xxx

Under Section 2, Article XII of the Constitution,10 which embodies the Regalian doctrine, all lands of the public domain belong to the State – the source of any asserted right to ownership of land.11 All lands not appearing to be clearly of private dominion presumptively belong to the State.12 Accordingly, public lands not shown to have been reclassified or released as alienable agricultural land or alienated to a private person by the State remain part of the inalienable public domain.13 Under Section 6 of the Public Land Act, the prerogative of classifying or reclassifying lands of the public domain, i.e., from forest or mineral to agricultural and vice versa, belongs to the Executive Branch of the government and not the court.14 Needless to stress, the onus to overturn, by incontrovertible evidence, the presumption that the land subject of an application for registration is alienable or disposable rests with the applicant.15

In the present case, the CA assumed that the lands in question are already alienable and disposable. Wrote the appellate court:

The theory of [petitioner] that the properties in question are lands of the public domain cannot be sustained as it is directly against the above doctrine. Said doctrine is a reaffirmation of the principle established in the earlier cases . . . that open, exclusive and undisputed possession of alienable public land for period prescribed by law creates the legal fiction whereby the land, upon completion of the requisite period, ipso jure and without the need of judicial or other sanction, ceases to be public land and becomes private property …. (Word in bracket and underscoring added.)

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The principal reason for the appellate court’s disposition, finding a registerable title for respondent, is her and her predecessor-in-interest’s open, continuous and exclusive occupation of the subject property for more than 30 years. Prescinding from its above assumption and finding, the appellate court went on to conclude, citing Director of Lands vs. Intermediate Appellate Court (IAC)16 and Herico vs. DAR,17 among other cases, that, upon the completion of the requisite period of possession, the lands in question cease to be public land and become private property.

Director of Lands, Herico and the other cases cited by the CA are not, however, winning cards for the respondent, for the simple reason that, in said cases, the disposable and alienable nature of the land sought to be registered was established, or, at least, not put in issue. And there lies the difference.

Here, respondent never presented the required certification from the proper government agency or official proclamation reclassifying the land applied for as alienable and disposable. Matters of land classification or reclassification cannot be assumed. It calls for proof.18 Aside from tax receipts, respondent submitted in evidence the survey map and technical descriptions of the lands, which, needless to state, provided no information respecting the classification of the property. As the Court has held, however, these documents are not sufficient to overcome the presumption that the land sought to be registered forms part of the public domain.19

It cannot be overemphasized that unwarranted appropriation of public lands has been a notorious practice resorted to in land registration cases.20 For this reason, the Court has made it a point to stress, when appropriate, that declassification of forest and mineral lands, as the case may be, and their conversion into alienable and disposable lands need an express and positive act from the government.21

The foregoing considered, the issue of whether or not respondent and her predecessor-in-interest have been in open, exclusive and continuous possession of the parcels of land in question is now of little moment. For, unclassified land, as here, cannot be acquired by adverse occupation or possession; occupation thereof in the concept of owner, however long, cannot ripen into private ownership and be registered as title.22

WHEREFORE, the instant petition is GRANTED and the assailed decision dated May 29, 1998 of the Court of Appeals in CA-G.R. CV No. 37001 is REVERSED and SET ASIDE. Accordingly, respondent’s application for original registration of title in Land Registration Case No. N-25-1 of the Regional Trial Court at Iba, Zambales, Branch 69, is DENIED.

No costs.

SO ORDERED.

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