Lorzano v. Tabayag
REITERATIONFacts
The Antecedents: Respondent Juan Tabayag, Jr. filed an amended complaint for annulment of document and reconveyance against petitioner Nancy T. Lorzano, his sister. Both are children of the late Juan Tabayag, who owned a parcel of land. Petitioner allegedly requested possession of the land until her son graduated college, which her siblings granted. After her son graduated, petitioner refused to relinquish possession, claiming she purchased the land from their father via a Deed of Absolute Sale dated May 25, 1992. Respondent claimed the signature on the deed was a forgery and that the acknowledgment was made before a person not commissioned as a Notary Public. The land was later registered under petitioner's name via Original Certificate of Title (OCT) No. 1786, issued pursuant to a Free Patent procured by petitioner. Procedural History: The Regional Trial Court (RTC) declared the Deed of Sale null and void, ordered petitioner to reconvey the land to the heirs, declared the property owned in common by the heirs, and awarded moral damages and attorney's fees. The Court of Appeals (CA) affirmed the RTC decision in toto, holding that a handwriting expert was not indispensable and that visual comparison sufficed. The CA also upheld the award of damages. The Petition: Petitioner assailed the CA decision, arguing that the questioned signature could not be declared spurious without a handwriting expert, that reconveyance was improper as her title was based on a free patent, and that respondent was not entitled to damages.
Issue(s)
Whether the lower courts erred in declaring the May 25, 1992 deed of sale a nullity, and whether the respondent is entitled to an award of moral damages and attorney's fees. Whether an action for reconveyance is proper in the instant case.
Ruling
The petition is DENIED. The Court of Appeals Decision dated March 18, 2009 and Resolution dated September 16, 2009 in CA-G.R. CV No. 87762 are AFFIRMED with MODIFICATION. The petitioner is ordered to pay the respondent moral damages in the amount of Thirty Thousand Pesos (₱30,000.00).
Ratio Decidendi
On the nullity of the Deed of Sale and award of moral damages and attorney's fees: The Court held that the finding of forgery by the RTC and CA involves a question of fact, which is conclusive upon the Supreme Court. The CA correctly ruled that a handwriting expert is not indispensable, as judges can conduct independent examinations. The award of moral damages and attorney's fees is also a question of fact. However, the Court found the awarded moral damages of ₱100,000.00 to be excessive and reduced it to ₱30,000.00, stating that moral damages are for reparation, not punishment, and must be reasonably commensurate to the injury sustained. On the propriety of the reconveyance of the subject property: The Court noted that the argument regarding the impropriety of reconveyance due to the property being acquired via free patent was raised for the first time on appeal, thus barred by estoppel. Nevertheless, the Court clarified that a title emanating from a fraudulently secured free patent does not become indefeasible. While generally, a fraudulently acquired free patent can only be assailed by the government in an action for reversion, an exception exists where a private individual seeks direct reconveyance based on a constructive trust. The Court reiterated that an action for reconveyance is a proper remedy for a rightful landowner whose property was wrongfully registered in another's name, even if the title was issued through a free patent, as it does not seek to annul the title but to compel the registered owner to transfer it to the rightful owner. The heirs of Tabayag had acquired a vested right over the property through open, continuous, adverse, and public possession.
Main Doctrine
A fraudulently acquired free patent, and the certificate of title issued pursuant to the same, may only be assailed by the government in an action for reversion. However, an exception exists where a private individual seeks direct reconveyance from a defendant who holds title to public land unlawfully and in breach of trust, on the principle of enforcement of a constructive trust. An action for reconveyance is proper even if the title was issued through a free patent, as such action does not aim to re-open registration proceedings but to compel the registered owner to transfer the property to the rightful owner.