Bagayas vs. Bagayas

Relief under Section 108 of PD 1529 is unavailable to establish heirship or co-ownership and compel amendment of a Torrens title where no partition was decreed and the claim is controversial and opposed, the remedy being limited to clerical corrections or uncontested insertions and incapable of reopening the decree of registration.

Hilaria Bagayas asserts status as the legally adopted daughter of the deceased spouses Maximino Bagayas and Eligia Clemente, while respondents Rogelio, Felicidad, Rosalina, Michael, and Mariel Bagayas stand as the biological children and successors of the Bagayas family, including the deceased Orlando Bagayas. The dispute concerns two parcels of land once registered in the names of Maximino and Eligia and now covered by Torrens titles in the names of Rogelio and Orlando. Resolution turns on the scope of direct versus collateral attacks on Torrens titles and the summary amendment procedure under Section 108 of Presidential Decree No. 1529, the Property Registration Decree.

On June 28, 2004, Hilaria Bagayas filed before the Regional Trial Court of Camiling, Tarlac a complaint for annulment of sale and partition, docketed as Civil Case No. 04-42, against Rogelio, Felicidad, Rosalina, Michael, and Mariel, all surnamed Bagayas. She alleged that respondents sought to exclude her from inheriting from her legally adoptive parents, Maximino Bagayas and Eligia Clemente, by falsifying a deed of absolute sale purportedly executed by the spouses on October 7, 1974 transferring two parcels of land registered in their names to their biological children, Rogelio Bagayas and Orlando Bagayas. The deed bore the signature of Eligia, who had died on August 21, 1971 and thus could not have signed in 1974. By virtue of that instrument, Rogelio and Orlando secured Transfer Certificates of Title Nos. 375657 and 375658 over the subject lands.

At trial, petitioner presented herself and five other witnesses to prove her allegations. According to respondents, petitioner was never adopted by Maximino and Eligia and had not even lived with the family. Rogelio, for his part, testified that after their parents died, he and Orlando executed a deed of extrajudicial succession to transfer the titles to their names, but before it could be registered they discovered the deed of absolute sale among Maximino's old files and used it by reason of convenience to acquire title.

In its Decision dated March 24, 2008, the trial court dismissed the complaint after framing four threshold questions concerning petitioner's adoption, the validity of the October 7, 1974 deed, her right to partition, and damages. The trial court found petitioner to be the adopted child of Maximino and Eligia, crediting the order of adoption over respondents' oral denials. It nevertheless upheld the deed on the ground that Eligia's signature was mere surplusage because the lands belonged exclusively to Maximino, who could alienate them without his wife's consent. It further ruled that petitioner could not demand partition because she failed to prove any ground invalidating the sale, and that the action was an improper collateral attack on Rogelio and Orlando's titles. On reconsideration, petitioner insisted the lands were conjugal, and in its Resolution dated June 17, 2008 the trial court acknowledged error on exclusivity in light of defendants' pre-trial admission that the properties were conjugal, but sustained dismissal on the collateral-attack ground. No appeal was taken, and the judgment lapsed into finality.

Thereafter, on August 1, 2008, petitioner filed twin petitions before the same court, docketed as LRC Nos. 08-34 and 08-35, seeking amendment of TCT Nos. 375657 and 375658 to include her name and those of her heirs and successors-in-interest as registered owners to the extent of one-third of the covered lands. Invoking Section 108 of PD 1529, she relied on the prior findings of adoption and of forgery of Eligia's signature as establishing her interest. In Resolutions dated January 6, 2009, the trial court dismissed both petitions on res judicata, finding their ultimate objective — inclusion as co-owner and eventual partition — identical to that in Civil Case No. 04-42. Reconsideration was denied by Order dated March 16, 2009.

• Res Judicata and Judgment on the Merits: Petitioner argued that the dismissal of Civil Case No. 04-42 on the ground that it was a collateral attack on title did not amount to a judgment on the merits, thus precluding the applicability of res judicata to LRC Nos. 08-34 and 08-35.
• New Interest under Section 108: Petitioner maintained that the RTC's determination in Civil Case No. 04-42 that she is the adopted child of Maximino and Eligia and that Eligia's signature on the deed of absolute sale was forged amounts to a new interest that should be reflected on the certificates of title, or provides reasonable ground for amendment thereof.
• Conjugal Character: Petitioner insisted that the subject lands were conjugal properties of Maximino and Eligia, not the exclusive properties of Maximino, in seeking reconsideration of the dismissal of the annulment and partition action.

• Denial of Adoption: Respondents denied any knowledge of petitioner's alleged adoption by Maximino and Eligia and pointed out that petitioner had not even lived with the family.
• Source of Title: Respondents, through Rogelio, claimed that after their parents died he and Orlando executed a deed of extrajudicial succession over the subject lands, but used the discovered deed of absolute sale by reason of convenience to acquire title thereto.

• Collateral Attack and Prior Dismissal: Whether the dismissal of the earlier complaint for annulment of sale and partition on the ground that it is in the nature of a collateral attack on the certificates of title constitutes a bar to a subsequent petition under Section 108 of PD 1529.
• Propriety of Section 108 Amendment: Whether petitioner may obtain amendment of TCT Nos. 375657 and 375658 under Section 108 of PD 1529 on the strength of the prior findings of adoption and forgery to be included as one-third co-owner.

• Collateral Attack and Prior Dismissal: No, not strictly by res judicata, as the LRC petitions involve different causes of action; the earlier dismissal for alleged collateral attack was erroneous because what was assailed was ownership, not the certificate itself, but that final judgment may no longer be reviewed for failure to appeal.
• Propriety of Section 108 Amendment: No. Amendment was properly denied because the adoption finding without a decreed partition conferred no registrable co-ownership, heirship cannot be declared in an ordinary action, and controverted partition claims fall outside summary Section 108 proceedings.

• Collateral Attack and Prior Dismissal: An action for partition first requires determination of whether co-ownership exists, ending either in dismissal or in adjudication of co-ownership and propriety of partition, each constituting a final appealable order. Dismissal of Civil Case No. 04-42 rested on the findings that the lands were exclusive to Maximino, rendering Eligia's forged signature inconsequential, and later on collateral attack despite the admitted conjugal character. That characterization was erroneous because, as clarified in Lacbayan, only the certificate of title — the document issued by the Register of Deeds — is immune from collateral attack, while ownership or title as a concept may be litigated in a partition suit premised on co-ownership. Nevertheless, petitioner's failure to appeal rendered the erroneous dismissal final and unreviewable.
• Propriety of Section 108 Amendment: Section 108 petitions were premised on the theory that amendment is a direct attack under Section 48, but an attack contemplates nullification of the certificate and challenge to the judgment pursuant to which it was decreed, particularly fraud or falsification raised in an action expressly instituted for that purpose within the prescribed period. Section 108 expressly disavows authority to reopen the judgment or decree of registration and, under settled jurisprudence, is confined to seven situations including terminated interests, new unreflected interests, clerical errors, name changes, civil status changes, dissolved corporate owners, and other reasonable ground for amendment. Petitioner's reliance failed for two reasons: the adoption and forgery findings produced no decreed partition and thus no declaration of heirship and co-ownership, matters of filiation and heirship being reserved to special proceedings rather than ordinary civil actions; and the controversy seeks partition of decedents' estates rather than correction of a clerical mistake, while Section 108 proceedings are summary and available only upon unanimity or absence of adverse claim or serious objection.

• Partition; Two-Phase Determination of Co-ownership — An action for partition seeks a declaration of co-ownership and segregation and conveyance of a determinate portion, requiring first a determination of whether co-ownership exists and partition is proper. Applied here to explain that denial of partition for failure to invalidate the sale, whether by dismissal or decree of partition and accounting, results in a final appealable order.
• Collateral Attack; Certificate of Title vs. Title — What cannot be collaterally attacked is the certificate of title, meaning the TCT document issued by the Register of Deeds, not title as ownership itself, which is more often than not represented by that document. Applied to hold erroneous the dismissal of the annulment and partition complaint, since petitioner assailed respondents' ownership rather than the Torrens certificates themselves.
• Direct Attack on Torrens Title — An action is deemed an attack on a certificate of title when its objective is to nullify the same, thereby challenging the judgment pursuant to which the certificate was decreed, with fraud or falsification raisable only in an action expressly instituted for that purpose and not by collateral proceeding. Applied to reject the characterization of the Section 108 petitions as the direct proceeding contemplated by Section 48 of PD 1529.
• Section 108 of PD 1529; Seven Instances for Amendment — Section 108, which disclaims authority to reopen the judgment or decree of registration, is limited to: (a) terminated registered interests; (b) new arisen interests not appearing on the certificate; (c) error, omission, or mistake in entry; (d) change of name; (e) marriage or termination thereof without prejudice to heirs or creditors; (f) dissolved corporation's failure to convey within three years; and (g) other reasonable ground for amendment. Applied to show that petitioner's claim did not fall within a proper ground for amendment constituting a direct attack.
• Declaration of Heirship in Ordinary Action — A trial court cannot make a declaration of heirship in an ordinary civil action, as rights of filiation and heirship must be ventilated in a special proceeding instituted precisely for determining such rights. Applied to deny registrable effect to the adoption finding where no partition, heirship, or co-ownership had been decreed.
• Summary Nature of Section 108 Proceedings — Proceedings under Section 108 of PD 1529 are summary, contemplating only clerical corrections or insertions and not controversial issues, and relief requires unanimity among parties or absence of adverse claim or serious objection. Applied to bar petitioner's use of Section 108 to litigate opposed partition of the deceased spouses' estate, leaving intestate settlement as the proper remedy.

• "What cannot be collaterally attacked is the certificate of title and not the title itself. The certificate referred to is that document issued by the Register of Deeds known as the TCT. In contrast, the title referred to by law means ownership which is, more often than not, represented by that document." — States the controlling distinction that rendered erroneous the dismissal of the partition action as a collateral attack.
• "Provided, however, That this section shall not be construed to give the court authority to reopen the judgment or decree of registration, and that nothing shall be done or ordered by the court which shall impair the title or other interest of a purchaser holding a certificate for value and in good faith, or his heirs and assigns, without his or their written consent." — Defines the statutory limit of Section 108 amendment authority invoked for inclusion as co-owner.
• "The first phase of a partition and/or accounting suit is taken up with the determination of whether or not a co-ownership in fact exists, and a partition is proper (i.e., not otherwise legally proscribed) and may be made by voluntary agreement of all the parties interested in the property." — Describes the two-stage structure of partition actions relevant to the finality of the dismissal.
• "It is a well-known doctrine that the issue as to whether the certificate of title was procured by falsification or fraud can only be raised in an action expressly instituted for the purpose." — States why forgery of the sale document could not support summary amendment of the Torrens certificates.

• Municipality of Biñan vs. Garcia, G.R. No. 69260, December 22, 1989, 180 SCRA 576 — Followed as authority for the two phases of a partition suit and the finality of an order either dismissing the action or decreeing partition and accounting.
• Lacbayan vs. Samoy, Jr., G.R. No. 165427, March 21, 2011, 645 SCRA 677 — Followed to distinguish title as ownership from certificate of title and to hold that resolving ownership in a partition action is not a collateral attack.
• Tapuroc vs. Loquellano Vda. de Mende, 541 Phil. 93 (2007) — Cited by the RTC to sustain dismissal of the annulment action as an improper collateral attack requiring a direct proceeding.
• Jarantilla, Jr. vs. Jarantilla, G.R. No. 154486, December 1, 2010, 636 SCRA 299, 319 — Cited for the definition of an attack on a certificate as an action seeking its nullification and challenging the underlying registration judgment.
• Borbajo vs. Hidden View Homeowners, Inc., G.R. No. 152440, January 31, 2005, 450 SCRA 315 — Followed for the doctrine that fraud or falsification in procuring a Torrens title must be raised by direct action and that the certificate cannot be altered in a collateral proceeding.
• Paz vs. Republic, G.R. No. 157367, November 23, 2011, 661 SCRA 74, 81 — Followed for enumerating the seven instances permitting amendment under Section 108 of PD 1529.
• Heirs of Teofilo Gabatan vs. CA, G.R. No. 150206, March 13, 2009, 581 SCRA 70, 78-79 — Followed for the rule that heirship and filiation cannot be declared in an ordinary civil action but must be ventilated in a special proceeding.
• Philippine Veterans Bank vs. Valenzuela, G.R. No. 163530, March 9, 2011, 645 SCRA 66 — Followed as controlling precedent that Section 108 proceedings are summary, limited to clerical corrections, and require unanimity or absence of adverse claim.
• Dapar vs. Biascan, G.R. No. 141880, September 27, 2004, 439 SCRA 179, 197 — Cited for the nature of a partition complaint as seeking declaration of co-ownership and conveyance of lawful shares.

• Section 108, PD 1529 — Authorizes amendment or alteration of certificates upon petition for terminated or newly arisen interests, errors, name or status changes, and other reasonable ground, after notice, without reopening the registration decree or impairing a good-faith purchaser's interest without consent; applied to deny inclusion of petitioner as one-third owner where the claim was controversial and no co-ownership had been decreed.
• Section 48, PD 1529 — Provides that a certificate of title shall not be subject to collateral attack and cannot be altered, modified, or cancelled except in a direct proceeding in accordance with law; applied to evaluate whether the Section 108 petitions constituted the required direct attack.

Antonio T. Carpio, Associate Justice, Chairperson; Arturo D. Brion, Associate Justice; Mariano C. Del Castillo, Associate Justice; Jose Portugal Perez, Associate Justice. No separate concurring reasoning beyond the majority is detailed in the text.