G.R. No. L-22377 November 29, 1968
Municipality (now City) of Legaspi, petitioner, vs. A. L. Ammen Transportation Co., Inc., respondent.

FACTS

The respondent, A. L. Ammen Transportation Co., Inc. (ALATCO), filed a petition for the reconstitution of its Transfer Certificate of Title covering a lot, which was granted by the Court of First Instance of Albay. Despite the reconstitution, the petitioner, Municipality (now City) of Legaspi, refused to surrender possession of the land, which it was using as a public road (Quezon Avenue). ALATCO then filed a complaint for recovery of possession against the Province of Albay, the Municipality of Legaspi, and private individuals. The Court of First Instance dismissed the complaint. On appeal, the Court of Appeals reversed the lower court, declaring the reconstituted title valid and ALATCO the registered owner, and ordered the City to vacate within one year or expropriate the land. The City of Legaspi petitioned for certiorari to review the Court of Appeals’ decision.

ISSUE

The primary issue revolves around the jural consequences of a judicially reconstituted certificate of title, specifically whether it is valid and conclusive against the City of Legaspi, which was occupying the land as a public road, and what remedies are available to the parties.

RULING

The Supreme Court affirmed the decision of the Court of Appeals. The Court held that a judicially reconstituted certificate of title, by express provision of Section 10 of Republic Act No. 26 , has the same validity and legal effect as the original and is not subject to encumbrances not noted on it. The proceedings for judicial reconstitution are in rem, and jurisdiction is acquired through posting and publication, so the lack of specific notice to the petitioner did not render the reconstitution void. The Court of Appeals correctly based its decision on the reconstituted title and did not err in refusing to inquire into allegations of fraud or bad faith in the reconstitution proceedings, as that would constitute a collateral attack. Regarding the City’s use of the land as a public road, the Supreme Court, citing Alfonso v. Pasay City, held that while the registered owner (ALATCO) is entitled to recover possession, the restoration is not feasible when the land has been devoted to public use as a road. The proper remedy is for the City to expropriate the property and pay just compensation. The Court noted that ALATCO itself acknowledged this solution in its brief. Thus, the Court of Appeals’ order for the City to vacate within one year or expropriate was sustained.