G.R. No. 117384 October 21, 1998
HEIRS OF TEODORO DELA CRUZ represented by EDRONEL DELA CRUZ, petitioners, vs. COURT OF APPEALS, PACIFICO MARQUEZ, FILOMENO and GREGORIO, both surnamed MADRID, respondents.

FACTS

Petitioners filed an action for reconveyance with damages against private respondents over a parcel of land in San Mateo, Isabela. Petitioners asserted that their predecessor-in-interest, Teodoro dela Cruz, bought the land from the Madrid brothers through a deed of sale executed on May 18, 1959, and they have been in actual, physical, continuous, and open possession since then. In October 1986, private respondents obtained Torrens Titles over the land. The Madrids denied executing the deed of sale, claiming it was fictitious, and asserted that petitioners’ possession was despite their demands to vacate. Pacifico Marquez claimed to be an innocent purchaser for value, having bought the land from the Madrids in 1976. During trial, petitioners could not present the original deed of sale, offering instead a photocopy (Exhibit “A”) of the purported carbon copy. The trial court ruled Exhibit “A” inadmissible for failure to account for all original copies and dismissed the complaint. The Court of Appeals held Exhibit “A” was admissible due to respondents’ failure to object but found it had no probative value, affirming the trial court’s dismissal but ordering remand to determine the value of petitioners’ improvements.

ISSUE

Whether petitioners have proven ownership of the land through the deed of sale and their long possession, thereby entitling them to reconveyance despite the respondents’ Torrens Titles.

RULING

The Supreme Court REVERSED the Court of Appeals and declared petitioners the legal owners of the land. While Exhibit “A” (the photocopy) was deemed admissible due to respondents’ failure to object, it lacked probative value as it was unsigned, undated, and the notary public could not verify its accuracy from his records. However, petitioners’ open, continuous, and exclusive possession since 1959, including the construction of significant improvements (rice mill, storage house, garage, pavements) without any protest or written demand from the Madrids for nearly 30 years, evidenced their ownership. The Madrids’ claim of fear due to killings was unsupported speculation. The Torrens Titles obtained by respondents in 1986 did not vest ownership, as the Torrens system does not create title. Prescription and laches barred respondents’ claim; their long inaction was inequitable. Marquez could not be an innocent purchaser for value as he admitted knowing of petitioners’ possession since 1959, and he failed to exercise due diligence.