G.R. No. 146030, December 3, 2002.
Republic of the Philippines, represented by the Department of Environment and Natural Resources, petitioner, vs. Heirs of Felipe Alejaga Sr., represented by Roqueta Alejaga, Felipe Alejaga Jr., Maria Dulla Alejaga, Felipe Alejaga III, Roqueta Alejaga, Jennifer Alejaga, Everette Capundan, and Lynette Alejaga; The Philippine National Bank and The Register of Deeds of Roxas City, respondents.

FACTS

On December 28, 1978, Felipe Alejaga Sr. filed Free Patent Application No. (VI-2) 8442 for a parcel of land in Dumolog, Roxas City. The Investigation & Verification Report by Land Inspector Efren L. Recio was dated December 27, 1978, a day before the application was filed. The patent was approved, and Original Certificate of Title No. P-15 was issued. The heirs of Ignacio Arrobang requested an investigation, alleging irregularities. Isagani Cartagena, a Supervising Special Investigator, recommended cancellation of the patent and title. Meanwhile, Alejaga obtained a loan from the Philippine National Bank (PNB), secured by a real estate mortgage on the property. On April 18, 1990, the Republic, through the Solicitor General, filed an action for Annulment/Cancellation of Patent and Title and Reversion. The Regional Trial Court (RTC) ruled in favor of the Republic, declaring the patent and title null and void due to fraud, ordering cancellation and reversion of the land to the public domain. The Court of Appeals (CA) reversed the RTC, ruling that the Republic failed to prove fraud and that the action for reversion was barred by the one-year prescriptive period under the Public Land Act. The Republic filed this Petition for Review.

ISSUE

1. Whether the free patent and certificate of title were obtained through fraud.
2. Whether the action for reversion is barred by prescription.

RULING

The Supreme Court granted the petition, reversing the Court of Appeals and reinstating the RTC decision.
1. The free patent was obtained through fraud. The procedure under the Public Land Act was violated. The Investigation & Verification Report was dated December 27, 1978, a day before the application was filed on December 28, 1978, making the investigation precipitate and anomalous. The Report was unsigned, negating any presumption of regularity. The land was also determined to be foreshore land, not alienable, based on the official report of the Land Management Bureau. Fraud was established by clear and convincing evidence.
2. The action for reversion is not barred by prescription. The one-year prescriptive period under Section 124 of the Public Land Act applies to actions brought by private individuals, not by the State. The State’s right to seek reversion of public land fraudulently granted is imprescriptible. A certificate of title issued pursuant to a void free patent does not become indefeasible. The mortgage to PNB was also declared void because the land, being foreshore land, was inalienable and could not be mortgaged. The loan was not for the improvement of the land but for a cottage industry, violating the Public Land Act.