GR 150824; (February, 2008) (Digest)
G.R. No. 150824 February 4, 2008
LAND BANK OF THE PHILIPPINES, petitioner, vs. REPUBLIC OF THE PHILIPPINES, represented by the Director of Lands, respondent.
FACTS
The Republic, through the Director of Lands, filed a complaint for cancellation of title and reversion against Angelito Bugayong and subsequent owners and mortgagees, including Land Bank of the Philippines (LBP). The subject property originated from Sales Patent No. 4576 and Original Certificate of Title (OCT) No. P-2823 issued to Bugayong in 1969. The land was subsequently subdivided and sold, with one lot eventually mortgaged to LBP by Lourdes Farms, Inc. in 1980.
An investigation by the Bureau of Lands revealed that at the time the sales patent and OCT were issued, the land was classified as forest land and was not yet declared alienable and disposable. It was only released as such in 1981. The land was marshy, covered by seawater during high tide, and Bugayong was never in actual possession. Consequently, the Republic sought to nullify the void title and revert the land to the public domain.
ISSUE
Whether OCT No. P-2823 and all derivative titles, including the mortgage interest of LBP, are void ab initio because the land was classified as forest land at the time of the patent’s issuance.
RULING
Yes. The Supreme Court affirmed the decisions of the lower courts, declaring OCT No. P-2823 and all titles emanating from it null and void. The core legal principle is that forest lands are outside the commerce of man and cannot be privately appropriated. A certificate of title issued over inalienable land of the public domain, such as forest or timber land, is void from the beginning. This nullity exists regardless of the good faith or innocence of any subsequent transferee or mortgagee.
The Court emphasized that the jurisdiction of the Director of Lands to dispose of public lands extends only to those classified as alienable and disposable. Since the subject land was indisputably forest land at the time Bugayong’s patent was issued in 1969, the Director of Lands had no authority to grant it. The patent and the resulting OCT were therefore void ab initio. This fundamental defect infected the entire chain of titles derived from it. Consequently, LBP’s defense as a mortgagee in good faith and for value must fail. One cannot claim rights from a void title; no rights can emanate from a source that does not legally exist. The land correctly reverts to the public domain.