MA. LUISA ANNABELLE A. TORRES, RODOLFO A. TORRES, JR., AND RICHARD A. TORRES vs. REPUBLIC OF THE PHILIPPINES, AND REGISTER OF DEEDS OF DAVAO CITY

The Court held that an RTC order issued during the execution stage to cancel derivative titles is not a final judgment, order, or resolution subject to annulment under Rule 47, but a permissible auxiliary writ issued pursuant to the trial court's residual jurisdiction under Section 6, Rule 135 of the Rules of Court. The governing principle is that purchasers of derivative titles derived from original titles voided for fraud acquire no indefeasible rights superior to their transferors, and the cancellation of such derivative titles during execution does not constitute a deprivation of property without due process.

The Republic filed a complaint in 1991 seeking the cancellation of free patents and original certificates of title issued to Spouses Leonora and Florencio Gaspar, alleging fraud and misrepresentation in their procurement. The Regional Trial Court granted the complaint in 1999, ordering the cancellation of the patents and titles and directing the reversion of the covered lots to the government. The Court of Appeals affirmed the decision in 2011, and the Supreme Court denied the Spouses Gaspar's petition for review in 2012, rendering the judgment final and executory. During the execution stage in 2014, the Republic moved for the cancellation of all derivative titles emanating from the voided OCTs. The RTC granted the motion on June 30, 2015, ordering the cancellation of multiple TCTs registered in the names of subsequent transferees, including the petitioners.

• The Republic instituted Civil Case No. 20,665-91 in 1991 to cancel free patents and original certificates of title issued to Spouses Leonora and Florencio Gaspar, alleging that the titles were secured through fraud and misrepresentation.
• The Regional Trial Court ruled for the Republic on April 20, 1999, cancelling the patents and OCTs and ordering the reversion of the covered lots to the State. The Court of Appeals affirmed the decision in 2011, and the Supreme Court denied final review in 2012.
• During the execution stage in 2014, the Republic moved for the cancellation of all derivative transfer certificates of title that had been subsequently issued from the voided OCTs. The RTC granted the motion on June 30, 2015, ordering the cancellation of multiple TCTs, including those registered in the names of petitioners.
• Petitioners, registered owners of five derivative TCTs and residing abroad, filed a petition for annulment of judgment under Rule 47 with the Court of Appeals. They alleged that the RTC lacked jurisdiction over their persons and violated due process because they were not impleaded in the original case.
• The Court of Appeals dismissed the petition, holding that the June 30, 2015 Order was an execution issuance under the RTC's residual jurisdiction, not a final judgment subject to Rule 47. The CA invoked the doctrine of stare decisis, citing a prior identical ruling in Hsi Pin Liu v. Republic.
• Petitioners elevated the matter to the Supreme Court via Rule 45, contesting the CA's dismissal, the applicability of stare decisis, and the RTC's residual jurisdiction. The Republic raised a preliminary objection regarding the verification and certification against forum shopping signed by petitioners' counsel.

• Petitioners maintained that the Court of Appeals erred in dismissing the Rule 47 petition because the June 30, 2015 RTC Order effectively varied the scope of the 1999 final judgment by cancelling derivative titles not expressly named therein.
• Petitioners argued that the RTC lacked jurisdiction over their persons and deprived them of due process because they were not original parties to Civil Case No. 20,665-91 and had no opportunity to be heard.
• Petitioners contended that ordinary remedies were unavailable through no fault of their own, satisfying the threshold for Rule 47 relief.
• Petitioners asserted that the RTC possessed no residual jurisdiction to issue the cancellation order because residual authority only applies after an appeal has been filed and the trial court has lost jurisdiction, which was not the case here.
• Petitioners challenged the application of stare decisis, arguing that the prior CA ruling in Hsi Pin Liu should not bind a different set of parties.

• The Republic argued that the petition should be dismissed for failure to strictly comply with verification and certification against forum shopping requirements, as the documents were signed by counsel rather than the petitioners.
• The Republic countered that the June 30, 2015 Order was a valid exercise of the RTC's residual jurisdiction under Section 6, Rule 135 of the Rules of Court, issued solely to enforce a final and executory decision.
• The Republic maintained that Rule 47 was inapplicable because the assailed order was not a final judgment, and petitioners failed to allege the mandatory grounds of extrinsic fraud or lack of jurisdiction.
• The Republic emphasized that petitioners derived their rights from original titles voided for fraud; consequently, they acquired no indefeasible interest that could be protected by due process.

• Procedural Issues: Whether the petition is dismissible for defective verification and certification against forum shopping signed by counsel; whether an RTC order issued during the execution stage to cancel derivative titles constitutes a final judgment, order, or resolution subject to annulment under Rule 47.
• Substantive Issues: Whether the RTC validly exercised residual jurisdiction to order the cancellation of derivative titles during execution; whether the cancellation of derivative titles without impleading subsequent transferees violates jurisdictional requirements and due process; whether the doctrine of stare decisis mandates dismissal given a prior Supreme Court ruling on identical facts.

• Procedural: The Court found substantial compliance with the verification and forum shopping requirements. Because petitioners resided abroad and executed valid Special Powers of Attorney authorizing counsel to sign on their behalf, strict compliance was relaxed to serve the ends of justice. The Court further ruled that the June 30, 2015 RTC Order was not a final judgment, order, or resolution under Rule 47, but an auxiliary writ issued under the trial court's residual jurisdiction to enforce a final decision. Consequently, Rule 47 was procedurally unavailable.
• Substantive: The Court held that the RTC properly exercised residual jurisdiction under Section 6, Rule 135 to cancel derivative titles incidental to the reversion of lots to the State. Cancellation did not violate due process because derivative titles stemming from original titles voided for fraud carry no indefeasibility; transferees acquire no better rights than their predecessors. Since the root titles were void, petitioners held no property right capable of deprivation. The Court applied stare decisis, binding the instant case to Liu v. Republic, which resolved the exact same legal questions against the petitioners. The petition was denied and the CA resolutions were affirmed.

• Stare Decisis et Non Quieta Movere — The doctrine mandates that courts adhere to established precedents to secure certainty and stability in judicial decisions. The Court applied this principle to bind the instant case to its prior ruling in Liu v. Republic, holding that substantially identical facts and legal questions must yield identical outcomes regardless of differing parties.
• Residual Jurisdiction of Trial Courts — Under Section 6, Rule 135 of the Rules of Court, a trial court retains authority to issue auxiliary writs, processes, and other means necessary to carry its jurisdiction into effect during the execution stage. The Court recognized this authority as the proper legal basis for the RTC's issuance of the June 30, 2015 Order cancelling derivative titles.
• Nemo Dat Quod Non Habet (Implied Principle) — The Court relied on the settled rule that a transferee acquires no better title than the transferor. Because the Spouses Gaspar's original titles were voided for fraud, they possessed no valid property rights to convey to subsequent purchasers. Accordingly, petitioners' derivative titles were void from inception and subject to cancellation without violating due process.

• "Since their predecessors-in-interest had no right over the subject lots to transfer to petitioners, the latter cannot be deprived of a right, even if it involves property, which does not exist." — The Court invoked this principle to establish that due process protections attach only to existing property interests, which petitioners lacked due to the voided root titles.
• "Stare decisis simply means that for the sake of certainty, a conclusion reached in one case should be applied to those that follow if the facts are substantially the same, even though the parties may be different." — The Court used this formulation to justify the mandatory application of its prior Liu ruling, emphasizing that judicial stability bars the relitigation of identical issues.

• Altres v. Empleo, 594 Phil. 246 (2008) — Cited to establish the jurisprudential standards for substantial compliance with verification and certification against forum shopping, particularly when counsel signs as attorney-in-fact under valid Special Powers of Attorney.
• Hsi Pin Liu, et al. v. Republic of the Philippines (Liu), G.R. No. 231100, January 15, 2020 — Cited as controlling precedent on the identical issue of cancelling derivative titles during execution. The Court bound the instant case to this ruling under the doctrine of stare decisis.
• Chinese Young Men's Christian Association of the Philippine Islands v. Remington Steel Corp., 573 Phil. 320 (2008) — Cited to define the policy rationale behind stare decisis, emphasizing that certainty and stability require courts to apply established legal principles to future cases with substantially similar facts.

• Section 1, Rule 47 of the Rules of Court — Governs the coverage of annulment of judgments. The Court found the RTC's execution order fell outside this provision because it was not a final judgment or resolution.
• Section 2, Rule 47 of the Rules of Court — Enumerates the exclusive grounds for annulment (extrinsic fraud and lack of jurisdiction). The Court noted petitioners' failure to allege these grounds, further rendering Rule 47 inapplicable.
• Section 6, Rule 135 of the Rules of Court — Grants courts residual jurisdiction to issue auxiliary writs and processes necessary to carry their jurisdiction into effect. The Court relied on this provision to validate the RTC's June 30, 2015 Order.