Catholic Vicar Apostolic of the Mountain Province vs. Court of Appeals, Heirs of Egmidio Octaviano and Juan Valdez

Facts:

The whole controversy started when the herein petitioner filed an application for registration of lands 1, 2, 3 and 4 in La Trinidad, Benguet on September 5, 1962. The heirs of Juan Valdez and the heirs of Egmidio Octaviano filed an opposition on lots 2 and 3, respectively. On November 17, 1965, the land registration court confirmed the registrable title of the petitioner. On May 9, 1977, the Court of Appeals reversed the decision and dismissed the Vicar’s application. The heirs filed a motion for reconsideration, praying that the lots be ordered registered under their names. The Court of Appeals denied the motion for lack of sufficient merit. Both parties then came before the Supreme Court. The Supreme Court, in a minute resolution, denied both petitions. The heirs filed the instant cases for the recovery and possession of the lots.

Respondents argue that the petitioner is barred from setting up the defense of ownership or long and continuous possession by the prior judgment of the Court of Appeals under the principle of res judicata. Petitioner contends that the principle is not applicable because the dispositive portion of the judgment merely dismissed the application for registration.

Issues:

(1) Whether the decision of the Court of Appeals constitute res judicata and therefore bars the petitioner from alleging ownership over the lots

(2) Whether the petitioner has acquired the lots through acquisitive prescription

Held:

(1) The Court of Appeals did not positively declare private respondents as owners of the land, neither was it declared that they were not owners of the land, but it held that the predecessors of private respondents were possessors of Lots 2 and 3, with claim of ownership in good faith from 1906 to 1951. Petitioner was in possession as borrower in commodatum up to 1951, when it repudiated the trust by declaring the properties in its name for taxation purposes. When petitioner applied for registration of Lots 2 and 3 in 1962, it had been in possession in concept of owner only for eleven years. Ordinary acquisitive prescription requires possession for ten years, but always with just title. Extraordinary acquisitive prescription requires 30 years. On the above findings of facts supported by evidence and evaluated by the Court of Appeals, affirmed by this Court, We see no error in respondent appellate court's ruling that said findings are res judicata between the parties. They can no longer be altered by presentation of evidence because those issues were resolved with finality a long time ago. To ignore the principle of res judicata would be to open the door to endless litigations by continuous determination of issues without end.

(2) Private respondents were able to prove that their predecessors' house was borrowed by petitioner Vicar after the church and the convent were destroyed. They never asked for the return of the house, but when they allowed its free use, they became bailors in commodatum and the petitioner the bailee. The bailees' failure to return the subject matter of commodatum to the bailor did not mean adverse possession on the part of the borrower. The bailee held in trust the property subject matter of commodatum. The adverse claim of petitioner came only in 1951 when it declared the lots for taxation purposes. The action of petitioner Vicar by such adverse claim could not ripen into title by way of ordinary acquisitive prescription because of the absence of just title.

Motion for Reconsideration

Issue:

Who is entitled to the possession and ownership of the land?

Held:

Pursuant to the said decision in CA-G.R. No. 38830-R, the two lots in question remained part of the public lands. This is the only logical conclusion when the appellate court found that neither the petitioner nor private respondents are entitled to confirmation of imperfect title over said lots. Hence, the Court finds the contention of petitioner to be well taken in that the trial court and the appellate court have no lawful basis in ordering petitioner to return and surrender possession of said lots to private respondents. Said property being a public land its disposition is subject to the provision of the Public Land Act, as amended.

Article 555 of the Civil Code provides as follows:

Art. 555. A possessor may lose his possession:

(4) By the possession of another, subject to the provisions of Article 537, if the new possession has lasted longer than one year. But the real right of possession is not lost till after the lapse of ten years.

It is clear that the real right of possession of private respondents over the property was lost or no longer exists after the lapse of 10 years that petitioner had been in adverse possession thereof. Thus, the action for recover of possession of said property filed by private respondents against petitioner must fail. The Court, therefore, finds that the trial court and the Court of Appeals erred in declaring the private respondents to be entitled to the possession thereof. Much less can they pretend to be owners thereof. Said lots are part of the public domain.