Cruz v. Heirs of So Hiong
REITERATIONFacts
The Antecedents: Spouses Rodolfo and Lota Santos-Cruz (Spouses Cruz) were the registered owners of a parcel of land under TCT No. 356877-R. Alejandro So Hiong (now represented by his heirs) and his sister Conchita So Hiong were the former co-owners of the land under TCT No. 43193-R. Alejandro alleged that he left the owner's duplicate copy of TCT No. 43193-R with Conchita for safekeeping in 1972-1973. In July 2007, Alejandro discovered that the title was cancelled and replaced by TCT No. 356877-R in the name of Spouses Cruz, purportedly due to a sale. Alejandro claimed he never executed a deed of sale and suspected a fraudulent deed was used. Procedural History: Alejandro filed a Complaint for Annulment of Transfer Certificate of Title, Reconveyance, and Damages. The Regional Trial Court (RTC) dismissed the complaint, ruling that the action had prescribed, was barred by laches, and Alejandro failed to prove fraud. The Court of Appeals (CA) reversed the RTC, holding that the burden was on Spouses Cruz to prove their title, and Alejandro's action for reconveyance based on a fictitious deed of sale does not prescribe. The Petition: Spouses Cruz filed a petition for review on certiorari, arguing that the CA erred in shifting the burden of proof, ruling that the action was not barred by prescription and laches, and making findings of fact that were mistaken and without evidentiary basis.
Issue(s)
Whether the Court of Appeals erred in reversing the trial court's decision by shifting the burden of evidence to the petitioners (Spouses Cruz) to prove that there was no fraud in the transfer of TCT No. 356877-R. Whether the Court of Appeals erred in ruling that the cause of action of the respondents (Heirs of Alejandro So Hiong) is not barred by prescription and laches. Whether the findings of fact of the Court of Appeals are manifestly mistaken and without evidentiary basis.
Ruling
The Supreme Court granted the petition, reversed and set aside the decision of the Court of Appeals, and reinstated the decision of the Regional Trial Court dismissing the complaint.
Ratio Decidendi
On the burden of proof and fraud: The Court held that the CA erred in shifting the burden of proof to the Spouses Cruz. The Court reiterated that in an action for reconveyance, the party seeking to recover the property must prove, by clear and convincing evidence, that he is entitled thereto and that the adverse party committed fraud. Alejandro's bare allegation that the sale did not take place, without any other supporting evidence, cannot overcome the presumption of regularity in the issuance of TCT No. 356877-R. The failure of the Register of Deeds to produce a copy of the deed of sale, due to loss and destruction of records from a flash flood, does not automatically defeat the title. The Court cited Heirs of Datu Dalandag Kuli v. Pia to support the principle that the mere fact that copies of the deed of sale can no longer be produced does not defeat the legal presumption that the title was regularly issued, especially when the Register of Deeds certifies that proper procedure was observed. On prescription and laches: While the Court did not definitively rule on prescription and laches, it noted that Alejandro's actions and inactions weakened his case. It took him approximately thirty-four (34) years from leaving Pampanga in 1972 to file his complaint in 2007. Furthermore, upon his return to Pampanga in 2002, he rented a house instead of asserting his alleged ownership. These actions, coupled with the fact that the Spouses Cruz's family had been occupying the property to the exclusion of Alejandro since 1974, suggest that his claim was not asserted in a timely manner. The Court emphasized that regardless of whether the action had prescribed, Alejandro's failure to prove fraud was fatal to his claim. On the findings of fact: The Court found the CA's findings to be mistaken. The CA placed undue emphasis on the absence of the deed of sale, which the Court found to be an insufficient basis to invalidate the title, especially in light of the explanation for its unavailability and the presumption of regularity. The Court concluded that Alejandro failed to present sufficient evidence to overcome the presumption of regularity of the title issued to the Spouses Cruz. The best proof of ownership is the certificate of title, and it requires more than a bare allegation to defeat its face value.
Main Doctrine
The failure of the Register of Deeds to produce a copy of a deed of sale, due to loss or destruction of records, does not automatically invalidate a title issued pursuant to such deed, especially when the Register of Deeds certifies that proper procedure was observed and a notation exists in the primary entry book. The presumption of regularity in the issuance of a title can only be overcome by clear and convincing evidence of fraud.