G.R. No. 141019 , G.R. No. 164281, and G.R. No. 185781; November 23, 2011
Case Parties/Title:

G.R. No. 141019 : JOSE TEOFILO MERCADO, Petitioner, vs. VALLEY MOUNTAIN MINES EXPLORATION, INC., Respondent.
G.R. No. 164281: HEIRS OF JUAN OLIMPIADA AND HEIRS OF SERGIO OLIMPIADA, Petitioners, vs. COURT OF APPEALS, HON. ALFONSO GARCIA, Judge, RTC, Branch 18, Tagaytay City, VALLEY MOUNTAIN MINES EXPLORATION, INC., represented by its President, JOAQUIN RODRIGUEZ, AND CITY GOVERNMENT OF TAGAYTAY, Respondents.
G.R. No. 185781: HEIRS OF JUAN AND SERGIO OLIMPIADA, represented by Fernando Olimpiada as Attorney-in-Fact, Petitioners, vs. HON. GREGORIO M. MONREAL, CITY ASSESSOR, TAGAYTAY CITY, Respondents.

FACTS

The consolidated petitions involve conflicting claims over five parcels of land in Tagaytay City (Lots 4867, 7539, 7540, 7541, and 4831-B). The lots were originally declared under the names “Heirs of Narciso Olimpiada” (Lot 4867) and “Heirs of Juan Desengaño” (the other lots), who were in actual possession. For non-payment of real property taxes, the City Government sold the lots at a public auction on November 28, 1983, to Valley Mountain Mines Exploration, Inc. (VMMEI). The certificate of sale was registered on December 9, 1983.
To redeem the properties, the heirs, through their attorneys-in-fact, executed deeds of sale with assignment of rights in favor of Jose Teofilo Mercado. On December 7, 1984, Mercado paid the redemption amounts, and the City Treasurer issued a Certificate of Redemption and refunded VMMEI’s purchase price on December 11, 1984. However, Mercado’s checks were later dishonored. The City Treasurer advised Mercado to replace the bounced checks.
On April 14, 1986, VMMEI asserted its right to be reinstated as the highest bidder, offering to return the refund and pay updated taxes. The City Treasurer sought advice from the Minister of Finance on whether to accept VMMEI’s repayment without another auction. No written reply was received.
On August 7, 1986, the City Treasurer accepted partial cash payment from Mercado for the check replacement. However, on October 7, 1986, the person who made the payment on Mercado’s behalf withdrew it, deeming the transaction irregular as the redemption period had expired. This money was not returned by the City Treasurer.
VMMEI’s repayment was eventually accepted, and the OIC/City Treasurer executed Final Bills of Sale for the lots in favor of VMMEI. The previous tax declarations were cancelled, and new ones were issued in VMMEI’s name, which then paid the real property taxes.
The heirs sought reconsideration of the cancellation of their tax declarations, claiming illegal cancellation due to timely redemption, but were informed the sale complied with regulations.
On September 26, 1989, Mercado filed petitions for judicial confirmation of title over the lots. The Republic, the Heirs of Narciso Olimpiada (Carandang Group), the Heirs of Juan Desengaño, and VMMEI filed oppositions. VMMEI also filed a separate application for registration. The Heirs of Narciso Olimpiada (Carandang Group) filed their own verified application for judicial confirmation of title over Lot 4867.

ISSUE

The core issue is the determination of who has the superior right to apply for original registration of title over the subject properties, stemming from the validity and effects of the tax delinquency sale, the attempted redemption, and the subsequent transactions.

RULING

The Supreme Court consolidated the petitions and resolved them based on the factual and legal controversies presented. The ruling addressed the competing claims of Mercado, the Heirs (Olimpiada and Desengaño), and VMMEI, focusing on the validity of the tax sale redemption and VMMEI’s subsequent acquisition of title through the Final Bills of Sale. The Court’s decision hinged on the application of tax laws regarding redemption periods, the efficacy of payment with dishonored checks, and the rights of a purchaser at a tax delinquency sale. The disposition affirmed, reversed, or modified the decisions of the lower courts regarding the registration applications and the ownership claims over the disputed parcels of land.