G.R. No. 113615 ; January 25, 1996
Bienvenido Velarma, petitioner, vs. Court of Appeals and Josefina Pansacola, respondents.

FACTS

Petitioner Bienvenido Velarma constructed his dwelling on a portion of land in Mauban, Quezon, registered under Transfer Certificate of Title No. T-91037 in the name of Publio Pansacola, the deceased husband of private respondent Josefina Pansacola. After barangay conciliation failed and Velarma was convicted for violating the Anti-Squatting Law (P.D. No. 772), Pansacola filed an ejectment suit. Velarma defended his occupation by claiming the land now belonged to the government. He anchored this on a 1974 Sangguniang Bayan minutes where Publio Pansacola agreed to exchange the portion traversed by a new highway for a part of an abandoned road.
The Regional Trial Court (RTC) ruled for Pansacola, ordering Velarma to vacate and pay damages. The Court of Appeals affirmed. The RTC found no deed was ever executed to consummate the exchange agreement mentioned in the municipal minutes, and the Pansacolas had consistently demanded Velarma’s removal. Velarma petitioned the Supreme Court, insisting the agreement divested Pansacola of ownership, thus she had no cause of action.

ISSUE

Whether the 1974 Sangguniang Bayan minutes, reflecting an agreement to sell/exchange property without a formal deed, constitute a sufficient ground to defeat an ejectment suit.

RULING

No. The Supreme Court denied the petition. The legal logic is anchored on the nature of ownership and the perfection of contracts. Ownership of the registered land remained with the Pansacolas. The minutes of the meeting were merely evidence of a preliminary agreement or negotiation, not a consummated sale or exchange. For such a transfer to be effective and to divest ownership, a formal deed is essential. The Court noted that over twenty years had passed with no execution of a deed, no actual survey partitioning the abandoned road, and no conveyance to the Pansacolas. Absent expropriation proceedings or a consummated transfer, registered title prevails. The ejectment suit was proper as Velarma’s possession was by stealth and without the owner’s consent.
The Court also addressed procedural issues. While the ejectment case was filed in the RTC instead of the Municipal Trial Court, Velarma was estopped from challenging jurisdiction as he raised the issue of ownership in his answer and participated fully in the trial. Furthermore, Velarma admitted in his pleadings that prior barangay conciliation had been complied with, satisfying that jurisdictional requirement. The findings of the lower courts were thus upheld.