Ybiosa v. Drilon
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns the ownership of Lot 3667. Respondent Inocencio Drilon filed a complaint alleging that he purchased the property from the late Gabriel Drilon, but that a subsequent Deed of Absolute Sale in favor of petitioners Spouses Fredeswinda and Alfredo Ybiosa was a forgery. Respondent sought the annulment of this deed, the cancellation of the Original Certificate of Title derived from a Certificate of Land Ownership Award (CLOA), and damages. Petitioners, in their defense, denied the allegations and asserted that the sale to them was valid and that respondent's claim was unfounded and had prescribed. 2. Procedural History: The Regional Trial Court (RTC) declared the Deeds of Absolute Sale in favor of petitioners void due to badges of fraud and directed Fredeswinda Ybiosa to hold the lot in trust. However, it declared the oral sale to respondent void for lack of consent from Gabriel Drilon's wife and dismissed the claims for damages. Both parties appealed to the Court of Appeals (CA). The CA partially granted the appeal, declaring the deed of sale to petitioners void but the sale to respondent valid, subject to payment of the balance. The CA also noted that only the Department of Agrarian Reform (DAR) can cancel the CLOA and title. Petitioners' motion for reconsideration was denied, leading to the present petition. 3. The Petition: Petitioners seek review on certiorari of the CA's decision and resolution. They argue that the RTC and CA lacked jurisdiction over the case because the primary issue involved the cancellation of a CLOA and title, which falls under the exclusive jurisdiction of the DAR. They also contend that respondent's action had prescribed and that the deed of sale in their favor was valid, contrary to the CA's findings. They pray for the annulment of the assailed CA dispositions, the declaration of their deed of sale as valid, and the dismissal of the original complaint.
Issue(s)
WHETHER THE HONORABLE COURT OF APPEALS ERRED IN NOT DECLARING THAT THE COURT HAS NO JURISDICTION OVER THE CASE, AND THUS, ALL PROCEEDINGS THEREIN ARE NULL AND VOID. WHETHER THE HONORABLE COURT OF APPEALS ERRED IN NOT DECLARING THE ACTION OF PLAINTIFF-APPELLANT (RESPONDENT) FOR ANNULMENT OF DEED OF SALE AS HAVING PRESCRIBED. WHETHER THE HONORABLE COURT OF APPEALS ERRED IN DECLARING THE DEED OF SALE DATED FEBRUARY 28, 1992 OF DEFENDANT-APPELLANT (PETITIONERS) AS VOID. WHETHER THE HONORABLE COURT OF APPEALS ERRED IN CONCLUDING THAT THERE IS [A] PERFECTED SALE BETWEEN GABRIEL DRILON AND INOCENCIO DRILON OVER A PORTION [OF] LOT 3667 BY REASON OF ORDINARY RECEIPTS.
Ruling
The Petition is PARTIALLY GRANTED. The assailed August 23, 2012 Decision and May 14, 2014 Resolution of the Court of Appeals in CA-G.R. CV No. 01729 are ANNULLED and SET ASIDE. Civil Case No. 11985 is ordered DISMISSED FOR LACK OF JURISDICTION, AND ALL PROCEEDINGS TAKEN THEREIN ARE DECLARED NULL AND VOID AND OF NO EFFECT.
Ratio Decidendi
On Issue 1 (Jurisdiction): The Supreme Court ruled that the RTC had no jurisdiction over Civil Case No. 11985 because the primary relief sought was the cancellation of a Certificate of Land Ownership Award (CLOA) and its derivative title. Under the 1994 DARAB Rules of Procedure, matters involving the issuance, correction, and cancellation of CLOAs registered with the Land Registration Authority fall under the primary and exclusive jurisdiction of the Department of Agrarian Reform (DAR) Secretary, not the DARAB, unless an agrarian dispute exists. The Court emphasized that for DARAB to have jurisdiction, there must be a tenancy relationship between the parties, which was not established in this case. Therefore, all proceedings before the RTC and the CA were declared null and void for lack of jurisdiction. On Issue 2 (Prescription): While the issue of prescription was raised, the Court found it unnecessary to rule on it directly because the case was dismissed for lack of jurisdiction. The Court stated that since the RTC had no jurisdiction from the outset, any proceedings, including those related to prescription, were rendered void. The proper venue for the dispute, which involves the cancellation of a CLOA, is with the DAR Secretary, and the rules regarding prescription would apply within that administrative proceeding. On Issue 3 (Validity of Deed of Sale in favor of Petitioners): The Supreme Court did not directly rule on the validity of the Deed of Absolute Sale dated February 28, 1992, in favor of the petitioners. Instead, it declared that the RTC had no jurisdiction to pass upon the validity of the CLOA and the derivative title. Consequently, all proceedings and evidence presented before the RTC, including those pertaining to the alleged forgery of the deed of sale, were deemed null and void. The issue of ownership and the validity of the sale should be threshed out in the appropriate venue, which is the DAR. On Issue 4 (Perfected Sale between Gabriel Drilon and Inocencio Drilon): Similar to the previous issue, the Supreme Court did not definitively rule on whether a perfected sale existed between Gabriel Drilon and Inocencio Drilon. The Court's primary focus was on the jurisdictional defect. Since the RTC lacked jurisdiction to annul the CLOA and title, it could not validly rule on the ownership of the property or the existence of a perfected sale. The Court reiterated that the property was presumed to be State-owned until proven otherwise, and any sale by Gabriel without proper title was void. The matter of the alleged sale to Inocencio should also be addressed in the DAR proceedings.
Main Doctrine
The Regional Trial Court (RTC) has no jurisdiction over cases involving the cancellation of a Certificate of Land Ownership Award (CLOA) and its derivative title, as such matters fall under the exclusive jurisdiction of the Department of Agrarian Reform (DAR) Secretary, not the Department of Agrarian Reform Adjudication Board (DARAB), unless an agrarian dispute exists between landowner and tenant.