G.R. No. 80294 . March 23, 1990.
CATHOLIC VICAR APOSTOLIC OF THE MOUNTAIN PROVINCE, petitioner, vs. COURT OF APPEALS, HEIRS OF EGMIDIO OCTAVIANO and JUAN VALDEZ, respondents.

FACTS

This case involves a motion for reconsideration of a prior Supreme Court decision. The core dispute concerns the possession and ownership of Lots 2 and 3. In a prior land registration case (CA-G.R. No. 38830-R), the Court of Appeals found that neither the Catholic Vicar Apostolic (Vicar) nor the private respondents (Heirs of Octaviano and Valdez) were entitled to confirmation of imperfect title over the lots. This decision became final and executory after the Supreme Court denied petitions for its review. Consequently, the lots remained part of the public domain.
Subsequently, the private respondents filed actions for recovery of possession (accion publiciana) against Vicar in the Regional Trial Court. The lower courts ruled in favor of the private respondents, ordering Vicar to surrender possession. Vicar appealed, arguing that the factual findings from the final land registration case were conclusive and that the private respondents had no right to recover possession.

ISSUE

The primary issue is whether the private respondents are entitled to recover possession of the subject lots from Vicar, considering the final ruling that the lots are public land and that neither party holds an imperfect title.

RULING

The Supreme Court granted Vicar’s motion for reconsideration and reversed the appellate court’s decision. The Court held that the private respondents’ action for recovery of possession must fail. The foundational legal principle applied is res judicata. The final decision in CA-G.R. No. 38830-R conclusively established that the lots are public land and that neither party acquired an imperfect title. This finding is binding and cannot be relitigated.
The Court analyzed the nature of Vicar’s possession. Based on findings in the prior case, Vicar initially possessed the lots as a borrower in commodatum from the private respondents’ predecessors since 1906. However, Vicar repudiated this trust in 1951 by declaring the property for taxation in its own name and later filing for registration in 1962. By the time the private respondents filed their accion publiciana, Vicar had been in adverse possession for over a decade. Applying Article 555(4) of the Civil Code, the Court ruled that the “real right of possession” of the private respondents was extinguished after Vicar’s adverse possession lasted longer than ten years. Since the lots are public domain and the private respondents lost their real right of possession, they have no legal basis to recover possession from Vicar. The complaints were dismissed.