Oño vs. Lim

An action for quieting of title is not a collateral attack on a certificate of title when the plaintiff asserts that the existing title has become inoperative due to a conveyance in favor of the plaintiff's predecessor-in-interest, and seeks the removal of a cloud on title and confirmation of ownership. The action is deemed a direct attack when its objective is to annul or set aside the judgment pursuant to which the title was decreed, or to enjoin its enforcement; it is collateral or indirect when, in an action to obtain a different relief, an attack on the judgment is made only as an incident thereof.

The contending parties in this action for quieting of title are the heirs of the original registered owners, Spouses Diego Oño and Estefania Apas, and respondent Vicente N. Lim, whose deceased mother, Luisa Narvios-Lim, allegedly purchased the subject property in 1937. The property, Lot No. 943 of the Balamban Cadastre in Cebu City, is covered by Original Certificate of Title (OCT) No. RO-9969-(O-20449) under the Torrens system. The dispute centers on whether a sale of the registered land occurred in 1937 and whether a subsequent confirmation of sale executed by Antonio Oño, the only legitimate heir of the Spouses Oño, in 1961 validly transferred ownership to Luisa.

The subject of the controversy is Lot No. 943 of the Balamban Cadastre in Cebu City, covered by Original Certificate of Title (OCT) No. RO-9969-(O-20449). On October 23, 1992, respondent Vicente N. Lim filed a petition in the Regional Trial Court (RTC) in Cebu City for the reconstitution of the owner's duplicate copy of the OCT, alleging that the OCT had been lost during World War II by his mother, Luisa Narvios-Lim. Lim further alleged that the lot had been sold in 1937 to Luisa by Spouses Diego Oño and Estefania Apas, the lot's registered owners, and that although the deed evidencing the sale had been lost without being registered, Antonio Oño, the only legitimate heir of the Spouses Oño, had executed on April 23, 1961 in favor of Luisa a notarized document denominated as a confirmation of sale, which was duly filed in the Provincial Assessor's Office of Cebu.

Zosimo Oño and petitioner Teofisto Oño opposed Lim's petition, contending that they had the certificate of title in their possession as the successors-in-interest of the Spouses Oño. On account of the Oños' opposition, and upon order of the RTC, Lim converted the petition for reconstitution into a complaint for quieting of title, averring additionally that he and his predecessor-in-interest had been in actual possession of the property since 1937, cultivating and developing it, enjoying its fruits, and paying the taxes corresponding to it. He prayed that the Oños be ordered to surrender the reconstituted owner's duplicate copy of the OCT, and that the OCT be cancelled and a new certificate of title be issued in the name of Luisa.

In their answer, the Oños claimed that their predecessors-in-interest never sold Lot No. 943 to Luisa, and that the confirmation of sale purportedly executed by Antonio was fabricated, his signature thereon not being authentic. After trial, the RTC found that the Lims had been in peaceful possession of the land since 1937; that their possession had never been disturbed by the Oños, except on two occasions in 1993 when the Oños seized harvested copra from the Lims' caretaker; that the Lims had since declared the lot in their name for taxation purposes and had paid the taxes; and that the signature of Antonio on the confirmation of sale was genuine, giving more weight to the testimony of the notary public who had notarized the document than to the testimony of the expert witness who attested that Antonio's signature was a forgery.

On appeal, the CA affirmed the RTC, finding that Spouses Oño had sold the lot to Luisa and that such sale had been confirmed by their son Antonio. The CA ruled that the action for quieting of title was not a collateral but a direct attack on the title, and that the Lims' undisturbed possession had given them a continuing right to seek the aid of the courts. The CA nonetheless corrected the RTC by ordering that the Office of the Register of Deeds issue a new duplicate certificate of title in the name of Luisa, considering that the owner's duplicate was still intact in the possession of the Oños.

• Collateral Attack: The petitioners contended that the action for quieting of title should be disallowed because it constituted a collateral attack on OCT No. RO-9969-(O-20449), citing Section 48 of Presidential Decree No. 1529, which 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.

• Prescription: The petitioners asserted that the lot, being titled in the name of their predecessors-in-interest, could not be acquired by prescription or adverse possession.

• Forgery of Signature: The petitioners submitted that Lim's evidence did not preponderantly show that ownership of the lot had been transferred to Luisa, and that both the trial and appellate courts disregarded their showing that Antonio's signature on the confirmation of sale was a forgery.

N/A — The decision does not separately recount the respondent's arguments beyond the allegations in the complaint and the findings of the lower courts.

• Collateral Attack: Whether the validity of the OCT could be collaterally attacked through an ordinary civil action to quiet title.

• Prescription: Whether ownership over registered land could be lost by prescription, laches, or adverse possession.

• Existence of Deed of Sale: Whether there was a deed of sale executed by Spouses Oño in favor of Luisa and whether said deed was lost during World War II.

• Existence of Confirmation of Sale: Whether the confirmation of sale executed by Antonio in favor of Luisa existed.

• Genuineness of Signature: Whether the signature purportedly of Antonio in the confirmation of sale was genuine.

• Collateral Attack: No. The action for quieting of title was neither a direct nor a collateral attack on the OCT, because Lim was asserting only that the existing title registered in the name of the petitioners' predecessors had become inoperative due to the conveyance in favor of Lim's mother, and resultantly should be cancelled. Lim did not assail the validity of the OCT or challenge the judgment by which the title had been decreed.

• Prescription: No. Prescription was not relevant to the determination of the dispute because Lim did not base his right of ownership on adverse possession over a certain period; he insisted instead that title to the land had been voluntarily transferred by the registered owners themselves to Luisa, his predecessor-in-interest.

• Existence of Deed of Sale: Yes. The RTC and the CA both found that Spouses Oño had sold the lot to Luisa, and the Supreme Court declined to review the factual findings.

• Existence of Confirmation of Sale: Yes. The confirmation of sale executed by Antonio in favor of Luisa was found to exist and was ordered registered.

• Genuineness of Signature: Yes. The signature of Antonio on the confirmation of sale was genuine, the testimony of the notary public who had notarized the document prevailing over that of the petitioners' expert witness.

• Collateral Attack: An action or proceeding is deemed an attack on a title when its objective is to nullify the title, thereby challenging the judgment pursuant to which the title was decreed. The attack is direct when the objective is to annul or set aside such judgment, or enjoin its enforcement; the attack is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment is nevertheless made as an incident thereof. Quieting of title is a common law remedy for the removal of any cloud, doubt, or uncertainty affecting title to real property. Under Article 476 of the Civil Code, whenever there is a cloud on title to real property by reason of any instrument, record, claim, encumbrance, or proceeding that is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. Lim's complaint sought the removal of a cloud from his title and the confirmation of his ownership as the successor-in-interest of Luisa, not the nullification of the OCT.

• Prescription: Prescription, in general, is a mode of acquiring or losing ownership and other real rights through the lapse of time in the manner and under the conditions laid down by law. However, prescription was not relevant because Lim showed that his mother had derived a just title to the property by virtue of sale; that from the time Luisa had acquired the property in 1937, she had taken over its possession in the concept of an owner and had performed her obligation by paying real property taxes; and that in view of the delivery of the property, coupled with Luisa's actual occupation of it, all that remained to be done was the issuance of a new transfer certificate of title in her name.

• Forgery and Factual Findings: The Court cannot review the evaluation and appreciation of the evidence because the Court is not a trier of facts. Although this rule admits of certain exceptions — such as when the conclusion is a finding grounded entirely on speculation, surmises, or conjecture; when the inference made is manifestly mistaken; when there is grave abuse of discretion; when the judgment is based on a misapprehension of facts; when the findings of fact are conflicting; when the Court of Appeals went beyond the issues of the case; when the findings of the Court of Appeals are contrary to those of the trial court; when the findings of fact are conclusions without specific evidence; when the facts set forth in the petition are not disputed by the respondents; and when the findings of fact of the Court of Appeals are premised on the supposed absence of evidence and are contradicted by the evidence on record — none of the exceptions was present. The CA upheld the RTC's conclusion that Antonio's signature had not been simulated or forged, and the concurrence of their conclusion on the genuineness of the signature binds the Court. In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence, which is the weight, credit, and value of the aggregate evidence on either side. Lim successfully discharged his burden of proof, establishing by preponderant evidence that he had a superior right and title to the property. The petitioners did not present any proof of their better title other than their copy of the reconstituted certificate of title, which was not enough because the registration of a piece of land under the Torrens system did not create or vest title, such registration not being a mode of acquiring ownership. A certificate of title is merely an evidence of ownership or title over the particular property described therein, and its issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held in trust for another person by the registered owner.

• Direct vs. Collateral Attack on a Certificate of Title — An action or proceeding is deemed an attack on a title when its objective is to nullify the title, thereby challenging the judgment pursuant to which the title was decreed. The attack is direct when the objective is to annul or set aside such judgment, or enjoin its enforcement; the attack is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment is nevertheless made as an incident thereof. In this case, the action for quieting of title was not an attack on the OCT because Lim was asserting only that the existing title had become inoperative due to the conveyance in favor of his mother, and sought the removal of a cloud from his title and confirmation of his ownership.

• Quieting of Title — Quieting of title is a common law remedy for the removal of any cloud, doubt, or uncertainty affecting title to real property. Under Article 476 of the Civil Code, whenever there is a cloud on title to real property or any interest in real property by reason of any instrument, record, claim, encumbrance, or proceeding that is apparently valid or effective, but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. The competent court is tasked to determine the respective rights of the complainant and the other claimants.

• Certificate of Title as Evidence of Ownership — The registration of a piece of land under the Torrens system does not create or vest title, such registration not being a mode of acquiring ownership. A certificate of title is merely an evidence of ownership or title over the particular property described therein. Its issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held in trust for another person by the registered owner.

• Preponderance of Evidence — In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence, which is the weight, credit, and value of the aggregate evidence on either side, and is usually considered to be synonymous with the term greater weight of the evidence or greater weight of the credible evidence. It is evidence that is more convincing to the court as worthy of belief than that which is offered in opposition thereto.

• "An action or proceeding is deemed an attack on a title when its objective is to nullify the title, thereby challenging the judgment pursuant to which the title was decreed. The attack is direct when the objective is to annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral when, in an action to obtain a different relief, an attack on the judgment is nevertheless made as an incident thereof." — This passage defines the distinction between direct and collateral attacks on a certificate of title, which is central to the Court's ruling that the action for quieting of title was not a collateral attack.

• "The averments readily show that the action was neither a direct nor a collateral attack on OCT No. RO-9969-(O-20449), for Lim was asserting only that the existing title registered in the name of the petitioners' predecessors had become inoperative due to the conveyance in favor of Lim's mother, and resultantly should be cancelled." — This passage applies the direct/collateral attack doctrine to the facts of the case, explaining why the action for quieting of title was permissible.

• "The petitioners need to be reminded that a certificate of title is merely an evidence of ownership or title over the particular property described therein. Its issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held in trust for another person by the registered owner." — This passage articulates the principle that a Torrens certificate of title is not conclusive proof of ownership and does not preclude the possibility that the property may be held for another.

• Sarmiento vs. Court of Appeals, G.R. No. 152627, September 16, 2005, 470 SCRA 99 — Cited as authority for the definition of direct and collateral attacks on a certificate of title.

• Baricuatro, Jr. vs. Court of Appeals, G.R. No. 105902, February 9, 2000, 325 SCRA 137 — Cited for the proposition that in an action for quieting of title, the competent court is tasked to determine the respective rights of the complainant and the other claimants.

• Twin Towers Condominium Corporation vs. Court of Appeals, G.R. No. 123552, February 27, 2003, 398 SCRA 203 — Cited for the rule that the Supreme Court is not a trier of facts.

• Mamsar Enterprises Agro-Industrial Corporation vs. Varley Trading, Inc., G.R. No. 142729, November 29, 2005, 476 SCRA 378 — Cited for the enumeration of exceptions to the rule that the Supreme Court does not review factual findings.

• Naguiat vs. Court of Appeals, G.R. No. 118375, October 3, 2003, 412 SCRA 591 — Cited for the rule that the concurrence of the trial court and the appellate court on the genuineness of a signature binds the Supreme Court.

• Encinas vs. National Bookstore, Inc., G.R. No. 162704, November 19, 2004, 443 SCRA 293 — Cited for the definition of preponderance of evidence.

• Heirs of Clement Ermac vs. Heirs of Vicente Ermac, G.R. No. 149679, May 30, 2003, 403 SCRA 291 — Cited for the principle that a certificate of title is merely evidence of ownership and does not foreclose the possibility that the property may be co-owned or held in trust for another.

• Section 48, Presidential Decree No. 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. The Court applied this provision by determining that the action for quieting of title was not a collateral attack on the OCT.

• Section 109, Presidential Decree No. 1529 — Cited in the RTC's dispositive portion, which ordered the issuance of a new duplicate certificate of title in place of the lost duplicate, pursuant to the last paragraph of this section.

• Article 476, Civil Code — Provides that whenever there is a cloud on title to real property or any interest in real property by reason of any instrument, record, claim, encumbrance, or proceeding that is apparently valid or effective, but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title. The Court applied this provision to uphold the action for quieting of title.

Puno, C.J. (Chairperson), Carpio Morales, J., Leonardo-De Castro, J., and Villarama, Jr., J., concurred in the decision.

N/A — No dissenting opinions were noted in the provided case text.