G.R. No. 224507. September 20, 2017.
PRIVATIZATION AND MANAGEMENT OFFICE, PETITIONER, VS. EDGARDO V. QUESADA, MA. GRACIA QUESADA-MANALO, ELIZABETH QUESADA-JOSE, EUGENIO V. QUESADA, REPRESENTED BY THEIR ATTORNEY-IN-FACT, EUGENIO V. QUESADA, RESPONDENTS.

FACTS

Respondents, the Quesadas, filed a Petition to Surrender the owner’s duplicate copy of TCT No. 27090 under Section 107 of P.D. No. 1529 before the RTC of Quezon City, acting as a land registration court. They alleged ownership of a parcel of land, the original title of which was destroyed in a fire. The owner’s duplicate title was in the possession of petitioner PMO, having been delivered in 1983 to Golden Country Farms, Inc. as security under a Growership Agreement. Golden Country Farms was later sequestered, and its assets, including the title, were taken over by PMO’s predecessor. The Quesadas contended that any obligation under the agreement was extinguished by prescription and cited a 1999 RTC Pasay decision declaring their predecessors had no more liability. They demanded surrender of the title to facilitate transfer of ownership to their names.
PMO, through the OSG, moved to dismiss the petition on grounds of lack of cause of action, lack of jurisdiction of the land registration court over the contentious issue of ownership, and res judicata. The RTC initially denied the motion to dismiss, ordering a full-blown trial. Upon PMO’s motion for reconsideration, the RTC reversed itself and dismissed the petition for lack of jurisdiction, ruling the issue must be threshed out in an ordinary proceeding. The Quesadas filed a certiorari petition with the CA, which granted it, reinstating the petition and directing the RTC to conduct a hearing. PMO elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether the Regional Trial Court, acting as a land registration court, has jurisdiction to hear and adjudicate the Quesadas’ Petition to Surrender the owner’s duplicate certificate of title under Section 107 of P.D. No. 1529, considering PMO’s adverse claim.

RULING

Yes, the RTC has jurisdiction. The Supreme Court affirmed the CA decision, ruling that while land registration courts are generally limited to non-controversial proceedings, an exception exists when the trial court, in the exercise of its general jurisdiction, opts to hear and decide the contentious issues raised. The Court clarified that jurisdiction over the subject matter is conferred by law. The RTC, as a court of general jurisdiction, possesses the authority to hear all types of cases, including land registration and ordinary civil cases. The alleged contentious nature of the claim does not divest the RTC of jurisdiction; it merely affects the procedure. The proper course, as held in Concepcion v. Concepcion, is for the RTC to proceed, hear the evidence from both parties, and resolve the conflicting claims on their merits. The Court emphasized that this is a procedural, not a jurisdictional, matter. Therefore, the RTC, Branch 105, was directed to reinstate the petition and conduct a full-blown hearing with dispatch to resolve all pertinent issues, including the validity of PMO’s claim to withhold the title and the Quesadas’ entitlement to its surrender.