G.R. No. 248974, August 07, 2024
Heirs of Teodoro Tulauan, represented by Tito Tulauan, Petitioners, vs. Manuel Mateo; Magdalena Mateo Lorenzo, assisted by her husband, Jaime Lorenzo; Camella Homes, owned and operated by Communities Isabela, Inc.; and Register of Deeds of Ilagan and Santiago, Respondents.

FACTS

Petitioners, the Heirs of Teodoro Tulauan, filed a Complaint for Annulment of Documents, Reconveyance, and Damages against respondents. They alleged that Teodoro Tulauan was the absolute owner of a parcel of land covered by OCT No. P-1080. Sometime in the early 1950s, he left Santiago City for security reasons but continued to pay real estate taxes. On May 4, 1953, TCT No. T-4232 was issued in the name of respondent Manuel Mateo. The property was subsequently subdivided and portions were sold. On May 30, 1979, TCT No. 118858 covering a subdivided lot was issued in the name of respondent Magdalena Mateo Lorenzo. The Heirs discovered the developments when one of Teodoro’s children found the property being developed by a real estate developer. Upon inquiry with the Registry of Deeds, they learned Teodoro’s title was cancelled by virtue of a deed of conveyance, a copy of which was burned in a fire. They alleged the titles of Manuel and Magdalena were fraudulently issued based on inexistent documents. The Regional Trial Court (RTC) dismissed the complaint, ruling the action for reconveyance was barred by prescription (over 60 years from Manuel’s registration, over 34 years from Magdalena’s registration) and laches, and for failure to state a cause of action. The Court of Appeals (CA) affirmed the RTC. The Supreme Court, in a Decision dated September 7, 2022, reversed the CA and RTC, ruling that the action, based on the allegation of an inexistent deed of conveyance, is imprescriptible under Article 1410 of the Civil Code, and remanded the case to the RTC for trial. Respondents Communities Isabela, Inc. and Magdalena filed separate Motions for Reconsideration.

ISSUE

Whether the Supreme Court’s Decision dated September 7, 2022, which held the action for reconveyance to be imprescriptible and ordered remand for trial, should be reconsidered.

RULING

The Supreme Court denied the Motions for Reconsideration and affirmed its Decision. The Court held that the core allegation of the complaint is that the deed of conveyance which led to the cancellation of Teodoro’s OCT and issuance of titles to respondents is void or inexistent. An action for the declaration of the inexistence of a contract, such as this deed, does not prescribe under Article 1410 of the Civil Code. Consequently, the action for reconveyance based on such an inexistent contract is also imprescriptible. The Court clarified that the factual issues of whether laches has set in and whether respondents are innocent purchasers for value, which would affect the availability of reconveyance, are precisely the matters that require a full trial on the merits for determination. Therefore, the case was correctly remanded to the RTC for the conduct of a full-blown trial.