Esmaquel vs. Coprada

A registered owner's right to recover possession of property is imprescriptible and cannot be barred by laches when the occupant's possession is by mere tolerance; further, an occupant by tolerance cannot claim builder in good faith status, and asserting an unproven oral sale constitutes a collateral attack on a Torrens title.

In 1945, Emiliana Coprada permitted her nephew, respondent's late husband Brigido Coprada, to occupy a parcel of land out of affection, allowing him to build a nipa hut on the then-wasteland. Upon Emiliana's death, ownership passed to her daughter, petitioner Victoria Sordevilla. Respondent and her family resided on the property rent-free for decades. Petitioners eventually demanded that respondent vacate the premises, prompting the filing of an ejectment suit.

• Initial Occupation: In 1945, the original owner, Emiliana Coprada, allowed her nephew Brigido Coprada (respondent's late husband) and his family to occupy the subject lot out of love and affection. The area was a wasteland, which respondent's family cleared, constructing a nipa hut.
• Alleged Oral Sale: Respondent claimed that in the early 1960s, petitioner Victoria orally sold a 100-square-meter portion of the lot for ₱2,000, fully paid by 1962. No written agreement was executed, allegedly due to the parties' close relationship and palabra de honor.
• Demand to Vacate: Citing improved circumstances of respondent's family, petitioners verbally demanded that respondent vacate, followed by a formal demand letter dated August 22, 1996, giving respondent until November 30, 1996, to leave. Respondent refused.
• Tax Declarations: Respondent asserted payment of realty taxes to support her claim of ownership. Evidence showed, however, that payments only began in 1984 and were made in the petitioners' names as declared owners.
• Reply to Demand: Respondent's reply to the demand letter omitted any mention of the 1962 purchase, which the Court deemed indicative that the alleged sale was a mere afterthought.

• Entitlement to Possession: As registered owners holding a Torrens title, petitioners are entitled to possession, and their right to recover the property is never barred by laches.
• Unproven Oral Sale: Respondent's claim of ownership relies on an unproven oral sale, which cannot defeat a Torrens title.
• Laches Against Respondent: Respondent is guilty of laches for failing to assert her rights under the alleged 1962 sale for 35 years.
• Collateral Attack: Asserting ownership based on an oral sale in an ejectment proceeding constitutes a prohibited collateral attack on the certificate of title.

• Validity of Oral Sale: The 100-square-meter portion was orally sold to her in 1962; the absence of documentation resulted from close familial ties and palabra de honor.
• Laches Against Petitioners: Petitioners' prolonged inaction in asserting their rights bars their claim to recover possession by laches.
• Builder in Good Faith: Because she built structures with the owner's prior permission, she is a builder in good faith entitled to reimbursement and right of retention under Articles 546 and 448 of the Civil Code.

• Laches: Whether the registered owners' right to recover possession is barred by laches.
• Collateral Attack on Title: Whether respondent's claim of ownership based on an oral sale constitutes a collateral attack on the Torrens title.
• Builder in Good Faith: Whether respondent, occupying by tolerance, qualifies as a builder in good faith entitled to reimbursement and retention.

• Laches: The registered owner's right to recover possession is imprescriptible and not barred by laches when possession is by mere tolerance. Petitioners were not guilty of laches because they were not required to act until they made a demand to vacate, which they promptly followed with an ejectment suit. Conversely, respondent's 35-year failure to have the title transferred belies the existence of the sale.
• Collateral Attack on Title: Asserting ownership over a portion of titled land based on an unproven oral sale constitutes a collateral attack on the certificate of title, prohibited under Section 48 of Presidential Decree No. 1529. A Torrens title cannot be altered or canceled except in a direct proceeding for that purpose.
• Builder in Good Faith: Possession by mere tolerance does not confer builder in good faith status. Articles 448 and 546 of the Civil Code apply only to possessors who believe they own the land. Because respondent knew her possession was merely tolerated, she is not entitled to reimbursement or right of retention.

• Imprescriptibility of Registered Owner's Right to Recover Possession — A registered owner has the right to eject any person illegally occupying their property. This right is imprescriptible and can never be barred by laches, regardless of the length of possession, provided the possession was unauthorized or merely tolerated.
• Prohibition Against Collateral Attack on a Torrens Title — A certificate of title is indefeasible and binding upon the whole world until nullified by a court of competent jurisdiction. Under Section 48 of PD 1529, it cannot be subject to collateral attack and can only be altered or canceled in a direct proceeding for that purpose.
• Builder in Good Faith — Applies only to a possessor who builds on land with the belief of ownership. Persons whose occupation is by sheer tolerance of the owners are not possessors in good faith and cannot invoke Articles 448 and 546 of the Civil Code for reimbursement or retention.

• "As registered owners of the lots in question, the private respondents have a right to eject any person illegally occupying their property. This right is imprescriptible. Even if it be supposed that they were aware of the petitioners' occupation of the property, and regardless of the length of that possession, the lawful owners have a right to demand the return of their property at any time as long as the possession was unauthorized or merely tolerated, if at all. This right is never barred by laches."
• "It is well settled that both Article 448 and Article 546 of the New Civil Code, which allow full reimbursement of useful improvements and retention of the premises until reimbursement is made, apply only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner thereof. Verily, persons whose occupation of a realty is by sheer tolerance of its owners are not possessors in good faith."

• Rodriguez v. Rodriguez, G.R. No. 175720 (2007) — Followed for the principle that a Torrens title is indefeasible and binding upon the whole world, and can only be nullified by a court of competent jurisdiction in a direct proceeding.
• Labrador v. Spouses Perlas, G.R. No. 173900 (2010) — Followed for the ruling that a registered owner's right to eject illegal occupants is imprescriptible and never barred by laches.
• Arambulo v. Gungab, 508 Phil. 612 (2005) — Followed for the rule that possession by tolerance creates an implied promise to vacate upon demand, failing which a summary action for ejectment is proper.
• Soriente v. Estate of the Late Arsenio E. Concepcion, G.R. No. 160239 (2009) — Followed for the principle that a certificate of title cannot be collaterally attacked and that adjudication of ownership in ejectment cases is merely provisional.

• Section 1, Rule 70 of the Rules of Court — Governs actions for forcible entry and unlawful detainer. Applied to establish that respondent's possession became unlawful upon termination of the tolerated right and refusal to vacate after demand.
• Section 48, Presidential Decree No. 1529 (Property Registration Decree) — Prohibits collateral attacks on a certificate of title. Applied to bar respondent's claim of ownership based on an oral sale, which would alter the title outside a direct proceeding.
• Articles 448 and 546, Civil Code of the Philippines — Govern the rights of builders in good faith regarding reimbursement and retention. Held inapplicable because respondent was not a builder in good faith, her possession being by mere tolerance.

Antonio T. Carpio (Chairperson), Antonio Eduardo B. Nachura, Roberto A. Abad, Jose Catral Mendoza.