GR 192629; (November, 2015) (Digest)
G.R. No. 192629 , November 25, 2015
FILINVEST LAND, INC., PETITIONER, VS. EDUARDO R. ADIA, ET AL., RESPONDENTS.
FACTS
The respondents are registered owners of parcels of land in Cavite, awarded to them under the Comprehensive Agrarian Reform Law (CARL). In 1995, petitioner Filinvest Land, Inc. acquired possession of these properties after each respondent executed a “Sinumpaang Salaysay” or “Pagbibitaw ng Karapatan” (affidavits), relinquishing their rights over the properties for valuable consideration. The respondents alleged they surrendered possession based on an understanding that Filinvest would develop the land under a joint venture agreement (JVA), and they entrusted their owner’s duplicate certificates of title for this purpose. When development did not commence and Filinvest fenced the area, the respondents filed notices of adverse claim and later a complaint for recovery of possession. Filinvest argued the affidavits validly transferred possession and no JVA was signed. The Regional Trial Court (RTC) ruled in favor of the respondents, ordering Filinvest to vacate the properties and return the titles. The Court of Appeals (CA) affirmed the RTC decision, ruling the affidavits were void for violating Section 27 of CARL, which prohibits the sale, transfer, or conveyance of awarded lands within ten years. The CA applied Article 1416 of the Civil Code, an exception to the pari delicto doctrine, allowing the respondents to recover. Filinvest petitioned, arguing the affidavits validly transferred only possessory rights, and if void, the respondents must return the consideration to avoid unjust enrichment.
ISSUE
Who has the better right of possession over the subject properties?
RULING
The Supreme Court denied the petition, affirming the CA decision. The affidavits executed by the respondents are void for violating Section 27 of the CARL, which prohibits any sale, transfer, or conveyance of awarded lands within ten years, except under specific exceptions not applicable here. Jurisprudence establishes that transfers of possessory rights or waivers of rights over land awarded under agrarian reform laws are void. The Court rejected Filinvest’s claim that the affidavits merely transferred possession, as a plain reading showed they effectively transferred indefinite control, circumventing the legal prohibition. The pari delicto doctrine does not bar recovery because Article 1416 of the Civil Code applies when the prohibition (like Section 27 of CARL) is designed for the plaintiff’s protection—here, to protect farmer-beneficiaries. The respondents, as lawful owners, are entitled to possession. The Court also found no basis for Filinvest’s unjust enrichment claim, as it had possession for over fifteen years.