GR L 46798; (April, 1949) (Digest)
G.R. No. 46798 . April 30, 1949.
PINDANGAN AGRICULTURAL COMPANY, INC., plaintiff-appellee, vs. ERNEST A. SCHENKEL and CRISTINA GONZALES, defendants-appellants.
FACTS
The plaintiff, Pindangan Agricultural Company, Inc., is an agricultural corporation composed of ninety-three Filipino families. The land in dispute, over 491 hectares, was originally owned by defendant Cristina Gonzales, a Filipino citizen. She married Ernest A. Schenkel, a Swiss citizen, in 1910, and thereby lost her Filipino citizenship. After a series of transactions and a foreclosure by the Agricultural Bank, the land became part of the public domain. Both the plaintiff corporation and a corporation organized by Cristina Gonzales (“Cristina Gonzales, Inc.”) applied to lease the land. The Director of Lands awarded the lease to Cristina Gonzales, Inc., which decision was affirmed by the Secretary of Agriculture and Natural Resources. The plaintiff successfully challenged this award in the Court of First Instance, which annulled the lease granted to Cristina Gonzales, Inc. While the appeal was pending before the Supreme Court, the Philippine Legislature enacted Act No. 3514 , authorizing the sale of such lands back to their previous owners. Pursuant to this Act, the Director of Lands, with the Secretary’s approval, executed a conditional sale of the land to Cristina Gonzales, Inc. in 1929. The Supreme Court later affirmed the annulment of the lease. In 1932, the Director of Lands cancelled the 1929 conditional sale due to non-payment. In 1936, after the 1935 Constitution took effect, the Director of Lands executed a new deed of sale over the same land in favor of Cristina Gonzales (now referred to as Cristina Gonzales de Schenkel). The plaintiff filed the present action seeking to annul this 1936 sale.
ISSUE
Whether the deed of sale executed by the Director of Lands on December 7, 1936, in favor of Cristina Gonzales de Schenkel is valid.
RULING
No. The 1936 sale is null and void. The 1935 Constitution expressly prohibits the alienation of agricultural lands of the public domain to private individuals or corporations except to citizens of the Philippines. At the time of the sale in 1936, Cristina Gonzales, having married a Swiss citizen, was no longer a Filipino citizen. The Court rejected the appellants’ arguments, holding that: (1) the plaintiff, as an occupant and applicant for the land composed of Filipino families, had the legal standing to challenge the sale; (2) the sale violated the constitutional prohibition; and (3) the trial court did not commit reversible error. The appealed judgment, declaring the 1936 sale null and void, was affirmed.
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