Heirs of Cullado vs. Gutierrez

In an accion publiciana, the court has jurisdiction to provisionally resolve the issue of ownership only for the purpose of determining the better right of possession, but it cannot order reconveyance of the property or make a definitive determination of ownership, as such actions constitute a collateral attack on a Torrens title which is expressly prohibited by Section 48 of Presidential Decree No. 1529.

Dominic V. Gutierrez was issued Original Certificate of Title No. P-61499 covering a parcel of land measuring 18,280 square meters located at Aneg, Delfin Albano, Isabela, pursuant to a free patent dated May 10, 1995. Alfredo Cullado had been occupying and cultivating the land since 1977. On May 5, 1997, Gutierrez's father filed an action for recovery of possession against Cullado, who raised defenses of ownership and alleged fraud in the issuance of Gutierrez's title. The Regional Trial Court ruled in favor of Cullado's heirs, ordering reconveyance based on acquisitive prescription, prompting Gutierrez to seek annulment of judgment before the Court of Appeals.

• Dominic V. Gutierrez was issued Original Certificate of Title No. P-61499 on May 17, 1995, covering 18,280 square meters of land located at Aneg, Delfin Albano, Isabela, pursuant to Free Patent No. 023118 95 10606 dated May 10, 1995.
• Alfredo Cullado had been in actual possession and cultivation of the subject land since 1977, openly, adversely, and continuously.
• On May 5, 1997, Dominador L. Gutierrez, representing his minor son Dominic, filed an action for recovery of possession (accion publiciana) with damages and prayer for preliminary mandatory injunction against Cullado before the RTC of Cabagan, Isabela.
• In his Answer with Motion to Dismiss filed on August 18, 1997, Cullado raised "special and affirmative defenses" alleging that neither Dominic nor his father had been in actual possession or cultivation of the land, that Dominic was a minor when the free patent was issued, and that the title was fraudulently obtained.
• Cullado prayed for the reconveyance of the property to him and for the recovery of incidental litigation expenses.
• Cullado died during the course of the trial and was substituted by his heirs, namely his wife Lolita Cullado and their children Dominador, Romeo, Noel, Rebecca Lambinicio, Mary Jane Bautista, and Jimmy Cullado.
• Dominic's counsel repeatedly failed to attend scheduled hearings, resulting in the waiver of his right to cross-examine the witnesses presented by the heirs of Cullado.
• On May 18, 2010, the RTC rendered judgment dismissing Dominic's complaint and ordering him to reconvey the land to the heirs of Cullado, ruling that Cullado had acquired ownership through 36 years of possession by acquisitive prescription.
• Dominic filed a Petition for Relief from Judgment on March 18, 2011, alleging his counsel's negligence, but this was denied by the RTC for being filed out of time.
• On October 18, 2011, Dominic filed a Petition for Annulment of Judgment with the Court of Appeals on the grounds of extrinsic fraud and lack of jurisdiction.
• The Court of Appeals initially dismissed the petition on November 21, 2011, but reinstated it on October 23, 2012 upon Dominic's motion for reconsideration.
• The Court of Appeals granted the petition on December 6, 2013, reversing the RTC Decision on the ground that the defenses raised by the heirs of Cullado constituted a collateral attack on Dominic's title, which cannot be allowed in an accion publiciana, and that the RTC had no jurisdiction to resolve issues of reconveyance and fraud.
• The Court of Appeals denied the heirs' Motion for Reconsideration on May 27, 2014.

• The heirs of Cullado argued that the Court of Appeals erred in reversing the RTC Decision and in granting Dominic's petition for annulment of judgment.
• They maintained that the RTC had jurisdiction to resolve the issue of ownership and order reconveyance, or alternatively, that the defenses raised did not constitute a collateral attack on the Torrens title.
• They contended that Alfredo Cullado had acquired ownership through acquisitive prescription, having possessed the land for 36 years, and that the RTC correctly ruled that Dominic must reconvey the property.

• Dominic argued that the RTC lacked jurisdiction to order reconveyance in an accion publiciana, which is limited to determining the better right of possession and cannot definitively resolve issues of ownership.
• He contended that the defenses raised by the heirs of Cullado (fraud in obtaining title, minority at time of issuance, lack of possession by patentee) necessarily required a review of the registration decree, constituting a collateral attack on his Torrens title prohibited under Section 48 of PD 1529.
• He maintained that annulment of judgment was the proper remedy under Rule 47 where ordinary remedies such as appeal and petition for relief were no longer available through no fault of his own, attributable instead to his counsel's negligence.

• Procedural Issues: Whether the Court of Appeals properly granted the petition for annulment of judgment under Rule 47 of the Rules of Court.
• Substantive Issues:
  • Whether the Regional Trial Court had jurisdiction to order reconveyance of the land and rule definitively on the issue of ownership in an accion publiciana.
  • Whether the defenses raised by the heirs of Cullado constituted a collateral attack on Dominic's Torrens title.

• Procedural: The Supreme Court held that the petition for annulment of judgment was properly filed. While the ground of extrinsic fraud was barred because Dominic had already availed of a petition for relief from judgment, the ground of lack of jurisdiction was valid. The RTC's lack of jurisdiction to order reconveyance in an accion publiciana was apparent from the face of the judgment, and Dominic was not guilty of laches in filing the petition immediately upon learning of the adverse decision.
• Substantive:
  • The Court affirmed that in an accion publiciana, the trial court may provisionally resolve the issue of ownership solely to determine the better right of possession, following the doctrine in Supapo v. Sps. de Jesus. However, it cannot order reconveyance or make a definitive ruling on ownership, as this would constitute a collateral attack on the Torrens title prohibited by Section 48 of PD 1529.
  • The Court ruled that Dominic's title had become indefeasible and incontrovertible under Section 32 of PD 1529, as the one-year period to challenge it for actual fraud had lapsed (title issued May 1995, questioned August 1997). As a registered owner, Dominic has an imprescriptible right to eject illegal occupants under Section 47 of PD 1529 and Article 1126 of the Civil Code.
  • The RTC's ruling that Cullado acquired ownership through prescription was erroneous because the land was public land until titled in 1995, and prescription cannot run against registered land. Moreover, the heirs failed to properly identify the property, and the area claimed by Cullado differed from that in Dominic's title.
  • The Court held that the "special and affirmative defenses" raised were actually negative defenses and should have been raised as permissive counterclaims, but no docket fees were paid to vest the RTC with jurisdiction over such claims.

• Accion Publiciana — An ordinary civil proceeding to determine the better right of possession (possession de jure) independently of title, brought when dispossession has lasted more than one year. The court may provisionally resolve ownership to determine possession, but such resolution is not final and cannot result in an order for reconveyance, which requires a definitive determination of ownership possible only in an accion reivindicatoria.
• Collateral Attack on Torrens Title — Under Section 48 of PD 1529, a certificate of title cannot be altered, modified, or cancelled except in a direct proceeding. Raising defenses in an accion publiciana that would require review of the registration decree or nullification of the title constitutes a collateral attack, which is prohibited.
• Indefeasibility of Torrens Title — Under Section 32 of PD 1529, a decree of registration becomes incontrovertible after one year from its entry, and the title can only be attacked within that period for actual fraud in a direct proceeding; thereafter, the remedy is limited to an action for damages.
• Imprescriptibility of Right to Eject — A registered owner has an imprescriptible right to eject illegal occupants from registered land, as provided under Section 47 of PD 1529 and Article 1126 of the Civil Code. No title to registered land can be acquired by prescription or adverse possession.

• "A certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or cancelled except in a direct proceeding in accordance with law." — Section 48 of PD 1529 as cited by the Court.
• "While the RTC could have resolved the issue of ownership provisionally to determine the 'better right of possession,' which is allowed in an accion publiciana, it was without any power or jurisdiction to order the reconveyance of the land in dispute because that can be done only upon a definitive ruling on the said issue — something that cannot be done in an accion publiciana."
• "In an accion publiciana, the defense of ownership (i.e., that the defendant, and not the plaintiff, is the rightful owner) will not trigger a collateral attack on the plaintiff's Torrens or certificate of title because the resolution of the issue of ownership is done only to determine the issue of possession."
• "As a final note, we stress that our ruling in this case is limited only to the issue of determining who between the parties has a better right to possession. This adjudication is not a final and binding determination of the issue of ownership. As such, this is not a bar for the parties or even third persons to file an action for the determination of the issue of ownership."

• Supapo v. Sps. de Jesus — Established that in an accion publiciana, courts may provisionally resolve ownership to determine possession, but such adjudication is not final and binding on the issue of ownership.
• Catindig v. Vda. de Meneses and Roxas, Sr. v. Court of Appeals — Reiterated the principle that a certificate of title is conclusive evidence of ownership and that the registered owner has an imprescriptible right to eject illegal occupants.
• Ybañez v. Intermediate Appellate Court — Held that raising defenses in an answer in an ordinary civil action for recovery of possession that question the validity of a Torrens title constitutes a collateral attack, which is not allowed.
• Wee v. Mardo — Ruled that a public land patent becomes a veritable Torrens title, indefeasible upon expiration of one year from issuance, and can only be attacked for fraud within that period in a direct proceeding.
• The Bishop of Cebu v. Mangaron — Historical case discussing the continued existence of accion publiciana after the Civil Code.
• Gaudencio Labrador v. Sps. Perlas — Affirmed that the right of a registered owner to eject illegal occupants is imprescriptible and cannot be barred by laches.

• Section 48, Presidential Decree No. 1529 (Property Registration Decree) — Prohibits collateral attacks on certificates of title; modifications allowed only in direct proceedings.
• Section 32, Presidential Decree No. 1529 — Provides the one-year period to reopen and review a decree of registration obtained by actual fraud, after which the title becomes incontrovertible.
• Section 47, Presidential Decree No. 1529 — States that no title to registered land shall be acquired by prescription or adverse possession.
• Article 428, Civil Code — Recognizes the owner's right of action (jus vindicandi) to recover possession.
• Article 555, Civil Code — Governs the loss of possession, recognizing that real right of possession is not lost until after ten years.
• Article 1126, Civil Code — Provides that ordinary prescription of ownership cannot take place against a title recorded in the Registry of Property.
• Rule 47, Rules of Court — Governs annulment of judgments by the Court of Appeals based on extrinsic fraud or lack of jurisdiction.
• Rule 70, Rules of Court — Governs forcible entry and unlawful detainer, distinguishing these summary actions from accion publiciana.
• Section 19 and 33, Batas Pambansa Blg. 129 — Define the jurisdiction of Regional Trial Courts and Municipal Trial Courts over cases involving real property.
• Commonwealth Act No. 141 (Public Land Act) — Governs public lands and the issuance of patents; basis for determining when land becomes private.