GR L 33436; (June, 1984) (Digest)
G.R. No. L-33436. June 22, 1984. JOSE E. ONG, petitioner, vs. THE COURT OF APPEALS, ESCOLASTICA PAGUIO and MIGUEL PAGUIO, respondents.
FACTS
Cadastral proceedings for Lots 1146 and 2585 in Iligan were initiated. Only Silvestre Openiano and petitioner Jose E. Ong filed answers claiming ownership. An order of general default was issued against non-filers. After a fire destroyed court records, claimants were ordered to reconstitute their answers. Before reconstituting, Openiano sold the lots to respondents Escolastica and Miguel Paguio on August 6, 1959. The Paguios registered the sale, took possession, and built a P70,000 school building. Openiano later reconstituted his answer without informing the Paguios or the court of the sale.
The cadastral court proceeded to trial between Ong and Openiano, unaware the Paguios were the real parties-in-interest. A decision dated June 22, 1967, adjudicated the lots to Ong. No appeal was filed by Openiano, and the court ordered the issuance of a decree. Upon learning of the decision when a writ of possession was served, the Paguios, who were not parties, refused to vacate. They filed a timely petition for relief from judgment on December 18, 1967.
ISSUE
Whether the trial court gravely abused its discretion in granting the Paguios’ petition for relief from judgment, setting aside its final decision, and ordering a retrial.
RULING
The Supreme Court upheld the trial court and the Court of Appeals, finding no grave abuse of discretion. The legal logic rests on two key principles: the finality of a cadastral decision occurs only upon the issuance of the decree of registration by the Land Registration Commission, and a petition for relief is a proper remedy for a person with a meritorious claim who was fraudulently excluded from the proceedings.
At the time the Paguios filed their petition, no final decree had been issued. Following established doctrine, a decision in a land registration case does not become final and irrevocable until the decree is entered by the General Land Registration Office. Therefore, the court retained jurisdiction to act on the petition for relief. The Paguios, as purchasers in good faith who had registered the sale, taken possession, and made substantial improvements, had a direct legal interest. Their failure to participate was due to Openiano’s fraud in concealing the sale from them and the court. They were effectively deprived of their day in court. The Court cited Elviña vs. Filamor, which allows a non-party to avail of relief in land registration cases under circumstances of fraud or excusable negligence, provided the petition is filed within the reglementary period, which it was. The trial court’s order for retrial was a proper exercise of its equity jurisdiction to ensure a just determination of ownership involving all indispensable parties. The petition was dismissed.