G.R. No. 47924 July 31, 1989
MARCIANO ASUNCION, petitioner, vs. HON. GREGORIO G. PINEDA, Judge of the Court of First Instance of Rizal, Branch XXI, Pasig, Metro Manila, HEIRS OF MARIA OLIVEROS-SORIANO and HEIRS OF SOTERO OLIVEROS, respondents.

FACTS

Petitioner Marciano Asuncion filed a complaint for reconveyance with damages against the heirs of Maria Oliveros-Soriano and Sotero Oliveros. He alleged that a 3.5-hectare portion of land covered by TCT No. 15394, originally registered in the name of Macario Oliveros under OCT No. 10 issued in 1917, was held by Macario in trust for the benefit of petitioner’s father, Filemon Asuncion. The trust allegedly arose from an agreement where Filemon allowed his land to be included in Macario’s homestead application to facilitate its approval, with the understanding that Macario would hold the title in trust. Petitioner and his father allegedly remained in continuous possession.
Previously, in a separate partition case (Civil Case No. 21048) involving the same land among the respondents, petitioner filed a motion to intervene claiming ownership based on long possession. The trial court denied his intervention, ruling his claim could not prevail over a Torrens title, and the Court of Appeals affirmed this denial. Relying on this prior denial, the respondents moved to dismiss the reconveyance complaint on the ground of res judicata.

ISSUE

The primary issues are: (1) whether the denial of the motion to intervene in the partition case constitutes res judicata barring the separate action for reconveyance; and (2) whether the action for reconveyance based on an implied trust has prescribed.

RULING

The Supreme Court ruled that the denial of the motion to intervene was not a bar on the ground of res judicata. The Court explained that a motion to intervene is not a proper vehicle for litigating the full merits of a claim of ownership. The denial was merely a procedural determination that intervention was not the appropriate remedy, not an adjudication on the substantive rights of the parties. Therefore, the finality of the order denying intervention did not preclude the filing of an independent action, such as for reconveyance, to assert those substantive rights.
However, the Court ultimately dismissed the petition because the action for reconveyance had prescribed. The Court held that an action for reconveyance based on an implied or constructive trust, pursuant to Article 1456 of the Civil Code, prescribes in ten years. The one-year period for review of a decree of registration under Section 38 of the Land Registration Act did not apply, as petitioner was invoking a trust under Section 102 of the same Act. The contested OCT was issued in 1917, but the complaint was filed only in 1977—approximately sixty years later. Even reckoning the prescriptive period from the issuance of the title, the action was filed well beyond the ten-year period. The Court emphasized that laches and prescription had long set in, and title had become indefeasible. The acknowledgment of petitioner’s claim by one set of heirs could not revive a right already extinguished by prescription.