G.R. No. L-12515; April 30, 1959
JUANA FARIÑAS VDA. DE BACLIG, ET AL., plaintiffs-appellants, vs. EXTOR SERRANO, defendant-appellee.

FACTS

The plaintiffs, heirs of Eustaquio Baclig, Sr., filed an action in the Court of First Instance of Rizal to annul a document (Annex A) executed by Juana Fariñas Vda. de Baclig (the widow) releasing a portion of public agricultural land in favor of the defendant, Extor Serrano. The land was the subject of a sales application filed by Baclig in 1932, which was still pending with the Bureau of Lands. The plaintiffs alleged that the defendant, who had been the overseer of the land since 1934, requested the widow in 1954 to allow him to apply for a free patent over a 30-hectare portion. The widow agreed on the condition that the portion be taken from the uncultivated part. However, she later discovered that the deed of release covered the cultivated portion, contrary to their agreement, and that the defendant, in bad faith, had caused free patent applications to be filed for that portion, creating a conflict delaying the approval of the plaintiffs’ sales application. The defendant claimed the deed was executed in consideration of P1,000 he paid to the widow and alleged fraud on her part for not reflecting this in the document. During trial, the plaintiffs admitted the land in question was part of the public land covered by their pending sales application. The trial court, upon the defendant’s motion, dismissed the complaint, holding it had no jurisdiction because the Bureau of Lands, as a quasi-judicial body with exclusive authority over public land disposition, had already taken cognizance of the conflicting applications, and administrative remedies should be exhausted first.

ISSUE

Whether the regular court has jurisdiction to entertain an action for the annulment of a private deed of release covering a portion of public land, despite the pendency of the related sales and free patent applications before the Bureau of Lands.

RULING

Yes. The Supreme Court set aside the trial court’s order of dismissal and remanded the case for further proceedings. The Court held that while the Bureau of Lands has exclusive jurisdiction over matters concerning the sale, lease, or disposition of public lands, the present action is for the annulment of a private contract (the deed of release) on grounds of fraud and misrepresentation. The conflict between the plaintiffs’ sales application and the defendant’s free patent applications stems from the validity of this private agreement. Determining the validity of such a contract is not within the Bureau of Lands’ administrative functions but falls within the province of the regular courts. The trial court therefore erred in declining jurisdiction on the ground that the parties had not exhausted administrative remedies.