G.R. No. 95431 August 7, 1992
FLORENCIA DE LA CALZADA-CIERRAS, ANIANA DE LA CALZADA, FAUSTINA DE LA CALZADA, PORFERIA DE LA CALZADA, CONCORDIA DELA CALZADA-DELANTAN, APOLINARIO DE LA CALZADA, FELISA DE LA CALZADA-UNABIA, EXEQUIEL UNABIA, GENARO DE LA CALZADA, LUCAS DE LA CALZADA, JESUS DE LA CALZADA-JAGNA and FELISA DE LA CALZADA-LAVANDERO, petitioners, vs. THE HON. COURT OF APPEALS, AVENTINO C. SASAN and MARTINIANO DE LA CALZADA, respondents.

FACTS

The subject of the controversy is a parcel of land, Lot 4362, registered under TCT No. 3111 in the name of Ireneo De la Calzada. Ireneo died single and without issue on November 27, 1930, leaving a Last Will and Testament dated June 14, 1930, instituting his brothers Vicente and Miguel, and sister Sivera, all surnamed De la Calzada (predecessors of the petitioners), as his sole heirs. However, the disputed land appears to have been sold by Ireneo to Rosendo De la Calzada for P2,000.00 on March 23, 1930, three months before the execution of the will. After the sale, Rosendo took possession of the lot. On September 5, 1938, Rosendo executed a document, erroneously entered at the back of TCT No. 3111 as a “Declaration of Heirs and Sale,” but which was in fact an “Escritura de Venta Absoluta y Perpetua” (a deed of sale) of one-half of the property to Felix Sasan. As a result, TCT No. 21530 was issued on September 2, 1969, in favor of Rosendo De la Calzada. Subsequent transactions led to the issuance of separate titles. The petitioners, as heirs of Ireneo’s instituted heirs, claimed they only learned of these transactions on June 1, 1981, and filed an action on July 21, 1981, for declaration of nullity of the contracts and damages, alleging fraud. The respondents maintained the sale by Ireneo to Rosendo was valid, that they and their predecessors had been in possession for about 50 years, and that the petitioners were barred by estoppel. The Regional Trial Court ruled in favor of the petitioners, declaring the documents null and void and ordering restoration of the title. The Court of Appeals reversed the trial court, dismissing the complaint on the ground of laches.

ISSUE

Whether or not the Court of Appeals erred in dismissing the petitioners’ complaint for recovery of the disputed land on the ground of laches.

RULING

No, the Court of Appeals did not err. The Supreme Court denied the petition and affirmed the decision of the Court of Appeals. While the deed of sale from Ireneo to Rosendo was unregistered and, under the Torrens System, such an unregistered deed only operates as a contract between the parties and does not bind the land until registered, the petitioners’ action to recover the land is barred by the equitable doctrine of laches. The petitioners filed their complaint only on July 21, 1981, twelve years after the registration of the sale to Rosendo (TCT No. 21530 issued in 1969) and approximately fifty years after Rosendo took possession. The petitioners failed and neglected for an unreasonably long time to assert their right. The principle of laches is applied to avoid recognizing a right when to do so would result in a clearly inequitable situation.