G.R. No. 250486 , July 26, 2023
Tagumpay Realty Corporation, Petitioner, v. Empire East Land Holdings, Inc., Respondent.

FACTS

Petitioner Tagumpay Realty Corporation acquired a condominium unit, covered by Condominium Certificate of Title (CCT) No. 5903-R under respondent Empire East Land Holdings, Inc.’s name, through a public auction of tax delinquent properties on February 9, 2012. After the redemption period lapsed, title was consolidated, and a Deed of Conveyance was issued to Tagumpay Realty on May 8, 2013. Empire East failed to surrender the owner’s duplicate certificate of title. Consequently, on November 6, 2013, Tagumpay Realty filed a Petition before the Regional Trial Court (RTC), Branch 264, seeking to compel the surrender of the duplicate CCT and, upon refusal, the cancellation and issuance of a new title, citing Sections 75 and 107 of Presidential Decree (P.D.) No. 1529 (Property Registration Decree). The RTC Branch 264 initially granted the petition on November 23, 2015. However, it later referred the case to mediation and subsequently declared its earlier proceedings null due to non-joinder of issues. The case was transferred to RTC Branch 160. On April 26, 2018, RTC Branch 160 directed Tagumpay Realty to show cause why its petition should not be dismissed for non-compliance with the second paragraph of Section 108 of P.D. No. 1529, which requires such petitions to be filed in the original registration proceedings. On July 30, 2018, the RTC dismissed the petition without prejudice for said failure. The Court of Appeals affirmed the RTC’s dismissal. Tagumpay Realty elevated the case to the Supreme Court via a Petition for Review on Certiorari.

ISSUE

Did the Court of Appeals err in not finding grave abuse of discretion against the RTC when it ordered the dismissal of the Petition for its failure to comply with the second paragraph of Section 108 of P.D. No. 1529?

RULING

The Supreme Court GRANTED the Petition. It ruled that Tagumpay Realty’s original petition was governed by Section 107, not Section 108, of P.D. No. 1529. Section 107 applies to situations involving the surrender of a duplicate certificate of title due to an involuntary transfer of ownership (as in a tax sale), which was the core of Tagumpay Realty’s claim. In contrast, Section 108 applies to amendments or alterations of a certificate for nominal or insubstantial changes without a transfer of ownership. The second paragraph of Section 108, which requires filing in the original registration case, is applicable only to petitions filed under Section 108. Since Tagumpay Realty’s petition was anchored on Section 107, this requirement did not apply. Furthermore, the Court held that any objection based on improper venue or filing was waived by Empire East when it failed to raise it as an affirmative defense in its responsive pleading. The RTC’s error in dismissing the petition was an error of judgment, not a grave abuse of discretion correctible by certiorari. The Supreme Court reversed the CA Decision and Resolution, annulled the RTC Orders, and remanded the case to RTC Branch 160 for reinstatement and further proceedings.