G.R. No. 163610 ; September 27, 2010
HEIRS OF ENRIQUE TORING, represented herein by MORIE TORING, Petitioners, vs. HEIRS OF TEODOSIA BOQUILAGA, represented herein by PAULINO CADLAWON, CRISPIN ALBURO, VIVENCIO GOMEZ, EDUARDO CONCUERA and PONCIANO NAILON, Respondents.

FACTS

Petitioners, heirs of Enrique Toring, filed a petition for production and surrender of documents and annulment of titles. They alleged that in 1927, Teodosia Boquilaga sold four parcels of land to Enrique Toring, evidenced by a deed of absolute sale. The sale was registered, and Transfer Certificates of Title (TCTs) were issued in Toring’s name. These titles were allegedly destroyed during World War II. Petitioners claimed continuous possession and tax payment. Decades later, they discovered that respondents, heirs of Boquilaga, had successfully petitioned for the judicial reconstitution of the original certificates of title (OCTs) in Boquilaga’s name without notice to petitioners. One lot (Lot No. 1835) was subsequently transferred to the lawyers who handled the reconstitution. Petitioners sought to compel the surrender of the reconstituted titles for cancellation and the issuance of new ones in Toring’s name, arguing the reconstitution was fraudulent due to lack of notice.
Respondents denied the material allegations, asserting possession by the Boquilaga heirs and tax payments from 1992-1995. They argued the petition was an improper collateral attack on the reconstituted titles and that petitioners’ action was barred by prescription and laches.

ISSUE

The core issue was whether the action for annulment of the reconstituted titles and recovery of ownership was proper, or whether it constituted a prohibited collateral attack on certificates of title.

RULING

The Supreme Court denied the petition and affirmed the lower courts’ dismissal. The Court held that the action was essentially a collateral attack on the reconstituted titles, which is prohibited under Section 48 of Presidential Decree No. 1529 (Property Registration Decree). A certificate of title cannot be impeached, altered, or questioned in any proceeding except in a direct proceeding for that purpose. Petitioners’ action, while framed as one for annulment of document and reconveyance, ultimately sought to nullify the reconstituted OCTs issued in Boquilaga’s name. This objective attacks the titles collaterally, as the validity of the reconstitution decree itself was not directly assailed in an action filed for its annulment. The proper remedy, if the reconstitution was fraudulently obtained, was a direct action for annulment of the reconstitution decree itself, not an action against the holders of the titles.
Furthermore, the Court found petitioners’ claim of ownership barred by laches. They alleged knowledge of the 1927 sale and the issuance of TCTs, yet took no action to assert their rights or seek reconstitution of their own alleged titles for nearly seven decades. Their inertia, while respondents undertook the reconstitution process and presumably possessed the land, precluded relief. The Court also noted petitioners’ failure to present the original deed of sale or certified copies of the alleged TCTs in Toring’s name, weakening their claim. The action was correctly dismissed, except regarding Lot No. 1834, where a reconstituted TCT already existed in Toring’s name, making the issue moot.