Igo v. National Abaca & Other Fibres Corp.
REITERATIONFacts
The Antecedents: Plaintiffs, described as illiterate non-Christian Filipinos belonging to the Bagobo tribe, claimed ownership of two parcels of land in Davao City, inherited from Yoshiko Saito Yoon, Michiko Saito Yoon, Tamiko Saito Yoon, and Katsuko Saito Yoon, who were children of Yoon (Bagoba) and a Japanese national, Kiyosaki Saito. The Philippine Alien Property Administrator, treating the lands as property of Japanese nationals, issued Vesting Order No. P-688 and its Supplement on July 6, 1948, and April 4, 1949, respectively, vesting the lands in the United States Government. Subsequently, these rights were transferred to the Republic of the Philippines under the Philippine Property Act of 1946 and transfer agreements. Republic Act No. 477 provided for the administration and disposition of vested properties, and the National Abaca and Other Fibers Corporation (NAFCO) sold portions of these lands on installments to other defendants. Procedural History: On August 27, 1953, plaintiffs filed an action in the Court of First Instance of Davao to recover the properties and damages. Defendant NAFCO moved to dismiss, asserting that plaintiffs were barred from bringing the action due to their failure to file a sworn claim with the Philippine Alien Property Administration within two years from the date of vesting, as required by Sections 9(a) and 33 of the Trading with the Enemy Act, as amended. After trial, the court a quo dismissed the complaint for lack of jurisdiction. The Petition: Plaintiffs-appellants appealed, arguing that the lower court erred in dismissing their action for failure to file a claim with the Philippine Alien Property Administrator within the prescribed period. They contended that their action was one for reivindicacion, and thus the requirements of the Trading with the Enemy Act were not necessary to invest the court with jurisdiction.
Issue(s)
Whether the lower court erred in dismissing the action for failure to file a claim with the Philippine Alien Property Administrator within the period prescribed by the Trading with the Enemy Act. Whether the action filed by the plaintiffs is an ordinary reivindicatory action or one predicated on the Trading with the Enemy Act. Whether the defense of prescription under the Trading with the Enemy Act can be invoked by private transferees of the vested property.
Ruling
The Supreme Court affirmed the order of the lower court dismissing the complaint, holding that the action was barred by prescription under the Trading with the Enemy Act.
Ratio Decidendi
On the nature of the action and the applicability of the Trading with the Enemy Act: The Court found that the plaintiffs' action was not an ordinary reivindicatory action as claimed. The complaint explicitly averred that the lands were vested by the Philippine Alien Property Administrator under specific vesting orders, that the transfer certificates of title were cancelled and reissued in the Administrator's name, and that plaintiffs were dispossessed. The prayer sought to declare the vesting orders null and void and to cancel subsequent titles. Therefore, the action was a direct attack on the validity and effect of the vesting orders issued pursuant to the Trading with the Enemy Act, as amended, in relation to the Philippine Property Act of 1946. The Court stated, "From the above, it is clear that plaintiffs were deprived of their lands by virtue of the vesting orders issued by the Philippine Alien Property Administrator pursuant to the powers conferred upon him by the Trading with the Enemy Act, in relation to the Philippine Property Act of 1946." This classification was crucial in determining the applicable procedural requirements. On the bar of prescription under the Trading with the Enemy Act: The Court upheld the trial court's dismissal, finding that plaintiffs were barred from bringing their action due to their failure to comply with the condition precedent set by Sections 9(a) and 33 of the Trading with the Enemy Act. Section 33 mandates that no return of property may be made unless a notice of claim is filed within specific timeframes, and no suit may be instituted after April 30, 1949, or two years from the date of vesting, whichever is later. Since the vesting orders were issued on July 6, 1948, and April 4, 1949, and the action was filed on August 27, 1953, more than four years after the vesting, the plaintiffs were clearly barred. The Court emphasized, "It is clear from the above provisions that in order that a suit for the return of any vested property under the Trading with the Enemy Act may prosper, it is necessary that it be filed not later than April 30, 1949, or within two years from the date of vesting, whichever is later." The Court cited previous rulings to support this conclusion. On the invocation of the defense of prescription by private transferees: The Court clarified that while private individuals cannot invoke immunity from suit, the defense of prescription under Section 33 of the Trading with the Enemy Act is not a personal defense of the State but a limitation on the right to bring an action. This defense of limitations can be invoked by subsequent transferees, such as the Republic of the Philippines and NAFCO, to whom the vested lands were transferred. To allow recovery by claimants who failed to assert their rights within the prescribed period would render the provisions of the Act nugatory and permit circumvention of the law. The Court reasoned, "What is being invoked by appellees herein is not immunity from suit but the defense of prescription, that is, since plaintiffs failed to bring their action within two years from the date of vesting as provided for the law, they are now precluded from instituting the same not only against the United States Government but also against defendants or persons who derive their title from said government."
Main Doctrine
A claim for the return of property vested under the Trading with the Enemy Act must be filed within the period prescribed by Section 33 of the Act, which is either April 30, 1949, or two years from the date of vesting, whichever is later. Failure to comply with this condition precedent bars any subsequent action for recovery, not only against the United States Government but also against subsequent transferees of the vested property.