G.R. No. 46064 . September 7, 1989.
MIGUELA MIRANDA, FELICIDAD DE LA ROSA and LUZ DE LUBIO, petitioners, vs. HON. COURT OF APPEALS, JUSTA ALORA RANSUYO (Deceased) substituted by her children, namely: REBECCA RANSUYO ABAO, MIRIAM RANSUYO RAMOS, HONESTO RANSUYO and ERLINDA RANSUYO ABAO, ANGELA ALORA TAN, PEDRO ALORA, LYDIA ALORA (Married), LORETO ALORA SILVA and RHODY ALORA DE MATA, respondents.

FACTS

The private respondents, heirs of spouses Gabriel Alora and Tarcila Alzona, filed an action for reconveyance, annulment, and damages. They claimed ownership over a one-third northern portion of Lot No. 581, Biñan Estate, Laguna, alleging their parents purchased it from Melecio Legasto in 1930, who in turn bought it from the original owner, Roberto Almoro, in 1917. The Alora spouses declared the property for taxation, paid taxes, fenced it, built a resthouse, and cultivated it. They discovered only in 1961 that Almoro had donated the entire Lot No. 581 in 1948 to the petitioners (his adopted daughters) and to Pedro de la Cruz. De la Cruz later renounced his rights. The petitioners subsequently subdivided the lot and obtained Torrens titles in their names in 1961.
The petitioners, as defendants, argued the respondents’ action had prescribed and assailed the authenticity of the deeds of sale presented by the respondents. The trial court ruled in favor of the respondents, declaring the 1948 donation void as to the one-third portion already sold and ordering its reconveyance. The Court of Appeals affirmed the decision in toto.

ISSUE

Whether the Court of Appeals erred in affirming the trial court’s decision ordering the reconveyance of the disputed property to the respondents.

RULING

The Supreme Court denied the petition, upholding the Court of Appeals. The legal logic is anchored on property rights, prescription, and the limits of the Torrens system. First, the findings on the authenticity of the ancient deeds of sale and the respondents’ long-standing possession are factual and conclusive in a Rule 45 petition, which reviews only questions of law. The Court of Appeals correctly found the action for reconveyance had not prescribed, as it was filed in 1968 within ten years from the 1961 registration, which constituted the constructive discovery of the fraud.
Second, on substantive ownership, the Court ruled that Roberto Almoro could not donate in 1948 what he had already validly sold in 1917. Nemo dat quod non habet—one cannot give what one does not have. Consequently, the donation was void as to that one-third portion. The petitioners, as donees, acquired no better right than their donor and held the disputed portion under an implied trust for the true owners, the respondents.
Third, the petitioners’ acquisition of Torrens titles did not vest true ownership over the wrongfully included portion. Registration is not a mode of acquiring title but merely confirms existing ownership. The Torrens system does not protect a registrant who procures title including property they do not own, especially when done in bad faith. The principle that registration binds the whole world is inapplicable when the registration itself is flawed and covers property already belonging to another. Therefore, the respondents, as beneficial owners, were entitled to reconveyance. The petitioners’ certificates of title were subject to cancellation for the portion held in trust.