Heirs of Domingo Valientes v. Hon. Reinerio (Abraham) B. Ramas, et al.

An action for reconveyance based on an implied or constructive trust prescribes in ten years from the issuance of the Torrens title if the plaintiff is not in possession of the property; courts may dismiss cases motu proprio on the ground of prescription if it is apparent from the pleadings.

Dispute over a parcel of land in Zamboanga del Sur originally owned by Domingo Valientes, which he mortgaged in 1939. The mortgagees allegedly obtained title through a forged deed of sale, and their successor-in-interest eventually sought to clear the title of the heirs' adverse claim.

• Original Filing: SPL Case No. 1861 (CFI Pagadian) — Petition for Cancellation of Memorandum of Encumbrance filed by private respondent Minor on June 20, 1979.
• Original Filing: Civil Case No. 98-021 (RTC San Miguel, Zamboanga del Sur) — Complaint for Cancellation of TCT, Reconveyance, etc. filed by petitioners on August 20, 1998.
• Lower Court Decision: July 31, 2000 — RTC granted Minor's prayer in SPL Case No. 1861 to transfer title to her name. May 7, 2001 — RTC dismissed Civil Case No. 98-021 on the ground of forum shopping.
• Appeal: Petitioners filed a Petition for Certiorari with the CA assailing the RTC dismissal of Civil Case No. 98-021.
• SC Action: Petition for Certiorari assailing the CA Decision dated August 16, 2002 and Resolution dated January 16, 2003.

• Original Ownership and Mortgage: Domingo Valientes owned the subject property covered by OCT No. P-18,208. In 1939, he mortgaged the property to secure a loan from spouses Belen.
• The Alleged Forgery: In the 1950s, the Valientes family failed to retrieve the property. Through an allegedly forged document captioned "VENTA DEFINITIVA" (deed of sale), the spouses Belen obtained TCT No. T-5,427 in their names on December 22, 1969.
• Adverse Claim: On February 28, 1970, Valientes' children annotated an Affidavit of Adverse Claim on the back of TCT No. T-5,427.
• Transfer to Private Respondent: Upon the death of the spouses Belen, their heirs executed an extra-judicial settlement with partition and sale in favor of Vilma V. Minor.
• Minor's Petition: On June 20, 1979, Minor filed SPL Case No. 1861 to cancel the adverse claim. The RTC granted this on July 31, 2000, allowing title transfer to Minor.
• Heirs' Complaint: On August 20, 1998, the Valientes heirs filed Civil Case No. 98-021 for cancellation of TCT, reconveyance, accounting, receivership, injunction, and damages.
• RTC Dismissal: Minor filed an Omnibus Motion to Dismiss based on forum shopping and litis pendentia. The RTC initially denied it on August 3, 2000, but granted reconsideration on May 7, 2001, dismissing the case on the ground of forum shopping.
• CA Ruling: The CA agreed there was no forum shopping, litis pendentia, or res judicata, but affirmed the dismissal on the grounds of prescription and laches.

• The CA committed grave abuse of discretion by applying prescription because Minor did not appeal the RTC dismissal order based on forum shopping, thereby waiving the defense of prescription.
• The complaint, although captioned for reconveyance, is substantially an action to quiet title, which does not prescribe.
• Alternatively, assuming it is an action for reconveyance based on forgery (implied trust), the prescriptive period should be 30 years under Article 1141 in relation to Article 1137 of the Civil Code because the predecessors were in bad faith. The complaint was filed 28 years and 8 months from the issuance of the TCT, so it had not yet prescribed.
• The CA erred in applying Tenio-Obsequio and Declaro because those cases did not involve forgery.

• The CA correctly dismissed the case based on prescription and laches, as an action for reconveyance must be filed within 10 years from the issuance of the title.
• The defense of prescription was raised in the Answer with Affirmative Defenses and was not waived.
• Laches applies due to the petitioners' unreasonably long period of inaction in asserting their rights.

• Procedural Issues: Whether the CA can dismiss a complaint on the grounds of prescription and laches motu proprio despite the respondent's failure to appeal the RTC's dismissal order based on a different ground (forum shopping).
• Substantive Issues: Whether an action for reconveyance based on an implied trust arising from forgery prescribes in 10 years or 30 years when the plaintiff is not in possession of the property.

• Procedural: The SC ruled that the CA did not err in considering prescription and laches motu proprio. Under Section 1, Rule 9 of the Rules of Court, courts shall dismiss a claim if it appears from the pleadings or evidence on record that the action is barred by the statute of limitations. Furthermore, a defendant cannot be expected to appeal a dismissal order she prayed for simply because other grounds were not considered; thus, there was no waiver. Laches, although not enumerated in Rule 9, may also be considered by courts on their own initiative.
• Substantive: The SC ruled that the action prescribed in 10 years. Under the doctrine in Heirs of Jose Olviga, an action for reconveyance based on implied or constructive trust prescribes in 10 years from the issuance of the title if the plaintiff is not in possession of the property. If the plaintiff is in possession, the action is effectively to quiet title and does not prescribe. Here, petitioners were not in possession. The general 30-year prescriptive period for real actions under Articles 1141, 1134, and 1137 of the Civil Code yields to the special statute on registered lands (P.D. No. 1529) and established jurisprudence setting a 10-year prescriptive period for reconveyance based on implied trust. Since the complaint was filed more than 28 years after the TCT issuance, it had prescribed.

• Motu Proprio Dismissal based on Prescription — Under Section 1, Rule 9 of the Rules of Court, courts are mandated to dismiss claims motu proprio if it appears from the pleadings or evidence on record that the action is barred by the statute of limitations. The defense is not waived even if not raised on appeal by the defendant.
• Prescriptive Period for Reconveyance based on Implied Trust — An action for reconveyance based on an implied or constructive trust prescribes in 10 years from the date of registration of the deed or the issuance of the certificate of title over the property, provided the plaintiff is not in possession of the property. If the plaintiff is in actual possession, the right to seek reconveyance (which is effectively an action to quiet title) does not prescribe.
• Laches — Need not be specifically pleaded and may be considered by the court on its own initiative in determining the rights of the parties.

• Section 1, Rule 9, Rules of Court — Defenses and objections not pleaded are deemed waived; however, courts shall dismiss claims motu proprio if the action is barred by prior judgment, statute of limitations, litis pendentia, or lack of jurisdiction, provided the ground is apparent from the pleadings or evidence on record. Applied to justify the CA's motu proprio dismissal based on prescription.
• Article 1456, Civil Code — If property is acquired through mistake or fraud, the person obtaining it is considered a trustee of an implied trust. Applied to classify the petitioners' cause of action as enforcing an implied trust due to the alleged forgery.
• Articles 1141, 1134, and 1137, Civil Code — General rules on prescription of real actions over immovables (30 years for extraordinary prescription). SC held these general rules yield to the special statute on registered lands and jurisprudence setting a 10-year period for implied trusts.
• Sections 31 and 32, P.D. No. 1529 (Property Registration Decree) — Decree of registration becomes incontrovertible after one year. SC noted this does not preclude an action for reconveyance based on implied trust, but such action must still prescribe in 10 years.