G.R. No. 26337, December 17, 1926
CELSO LEDESMA, plaintiff-appellant, vs. THE MUNICIPALITY OF ILOILO, ET AL., defendants-appellees.

FACTS

Celso Ledesma filed an action to recover from the Municipality of Iloilo the value of Lots 537 and 703, which the municipality had appropriated for street-widening, plus damages. He claimed ownership based on a chain of Torrens titles originating from Concepcion Lopez. The records showed that on March 9, 1915, Concepcion Lopez had already sold Lots 537 and 703 to the Municipality of Iloilo for P25,000. However, due to an error in the Registry of Deeds, these lots were still included in the original certificate of title (OCT No. 464) issued to Lopez in November 1915 and in all subsequent transfer certificates, including the one eventually issued to Celso Ledesma. All parties in the chain of transactions (Concepcion Lopez, Maximo M. Kalaw, and Julio Ledesma) admitted that the inclusion of Lots 537 and 703 in the certificates was a mistake, as they were aware the lots had already been sold to the municipality and formed part of a public street.

ISSUE

Does the inclusion of land, which is already a public highway and was previously sold to a municipality, in a Torrens certificate of title vest ownership of that land in the holder of the certificate?

RULING

No. The Supreme Court affirmed the lower court’s decision, absolving the defendants. The Court held that the mere possession of a Torrens title does not make the holder the owner of property that was illegally or mistakenly included in the certificate. Citing *Legarda and Prieto vs. Saleeby*, the Court ruled that land which cannot be registered under the Torrens systemsuch as public highwaysdoes not become private property simply because it is erroneously included in a certificate of title. Since Lots 537 and 703 had already been validly sold to the Municipality of Iloilo for public use and had become part of a public street before the issuance of the original certificate, their inclusion in Celso Ledesma’s title was a nullity. Therefore, Celso Ledesma never acquired ownership and had no right to recover their value or damages from the municipality.