Action For Reconveyance & Annulment Of Title | The Difference
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  • Action For Reconveyance & Annulment Of Title | The Difference | Petition For Review Of The Decree of Registration

In order to have a grasp on what is an action for reconveyance and/or annulment of title, we must first define an action, suit, or case involving a parcel of land. This may be loosely termed as land dispute or conflicting rights over a particular real estate.

Land Dispute or conflicting rights over a land, as the term connotes, is a disagreement involving land’s contasting claims, territorial boundaries, and other similar assertions.

Obviously, this refers to certain parcel or parcels of land, which has or have different individuals imposing their apparent claimable rights thereto, be they ownership or possession or any real right.

Unregistered Real Property

Before a land is placed under the Torrens System of Registration, it is still regarded as an unregistered real property. Being such, it may be susceptible of being grabbed, taken, or seized from its legitimate owner, through the process of unscrupulous and fraudulent registration under the above system.

This is possible through fraudulent machination by concocting and fabricating an apparent registrable title or right of ownership i. e. spurious deed of sale or deed of donation, alleged acquisitive prescription [without actually possessing the land], or fabricated successional claims, and many other deceitful strategies.

Hence, these are valid and actual situations that justify the need to have the unregistered land be placed under the Torrens system. This is done by applying for a land title, either judicially or administratively.

Land Disputes and Land Conflicts

Throughout the history in the Philippines, land distribution has been the perennial problem. In this scenario of distribution, land conflicts and disputes always arise. Past, present, or even in the subsequent future, this will still be a major issue in terms of action upon the land or settlement of land claims.

It is humbly assumed that the problems lie because there are learned claimants and there are those unlettered ones. Historically, those unlettered people, who occupied a particular lot or vast tract of land, have claimed the same by virtue of ancestral rights.

Now, here comes the learned individuals, who have known the letter of the laws prevailing in the acquisition of real property. Owing to their knowledge, whether legitimately exercised or otherwise, they can have the ascendancy and supremacy over the actual occupants, especially in the early days of land acquisition and titling.

Consequently, they have been able to succeed in purposely taking the possession and eventually the ownership of that property whom they were interested to wrest from the actual occupants thereof.

Even until now, in remote areas or in rural set up, this has still been happening. Learned [additionally now, money talks also] individuals prevail over unlettered ones.

There have been instances, as well, that the battles, both legal and actual, toll much heavily on both sides. However, oftentimes, the power of money favors the wealthy ones. Protracted civil and criminal suits almost always have ensued. Hence, land disputes and conflicts are most of the times inevitable.

Action for reconveyance, accion publiciana, or accion interdictal [ejetment] are, among others, legal actions involving land disputes.

The Need for Registration of Land

It cannot be gainsaid that there is indeed a need to register a particular land under the Torrens system. Not only that this will protect the real property from deceptive claimants or sinister land grabber, upon registration, the certificate of title is conclusive upon the whole world and, likewise, the title of ownership as evidenced by the former document.

Nonetheless, it must undergo the process of land title application, culminating in the issuance of the certificate of title.

Fraudulent Title Registration | Unregistered Lands

It may happen, nevertheless, that the parcel of unregistered land has been granted a certificate of title, through fraud, deceit, intimidation, or other similar wrongful acts.

Hence, an Original Certificate of Title [OCT] may have been issued, not to the actual and legitimate owner, but to the fraudulent claimant.

For instance, assumed that the land is not yet registered under the Torrens system. A certain individual legitimately owned the same, although not actually occupying it; he is outside the country most of his life. He inherited the land from his parents. Here comes the owner’s tenant who physically possesses the land for more than 10 years. Yet, he knows that he is not the actual owner thereof.

Subsequently, the tenant judicially applied for a land title alleging acquisitive prescription in good faith for more than 10 years, a registrable title. During the proceedings before the Land Registration Court [LRC], the applicant tenant effectively prevented the real, true, and actual owner from participating in the land registration proceedings by means of fraudulent machinations.

Finally, the Land Registration Court, by virtue of a Decision dated specifically, granted the application for title of the tenant, thereby, directing the Register of Deeds, which has jurisdiction of the place where the property is situated, to issue the Original Certificate of Title [OCT] with the technical descriptions contained therein and free from all liens and encumbrances. An OCT has, thereafter, been issued under the the name of the tenant and the date of registration has been entered into therein also.

The tenant’s act, in this case, apparently deprives the real owner the actual ownership of the property. Does the real owner have any legal remedy to rectify the injustice committed against him?

Petition for Review of the Decree of Registration

Can the real owner question the validity and correctness of the Decree of Registration as a result of the LRC’s Decision, even though the true owner did not participate in the land registration proceedings, on account of the actual fraud employed by his tenant, so as to effectively deprive the former to be an interested party in the registration case?

The real owner can still question the validity and correctness of the Decree of Registration and Certificate of Title itself, thereby, praying for its total annulment and cancellation.

Under an existing law, [1]Section 32, Presidential Decree No. 1529 covering this instant situation, it provides that:

“Review of decree of registration; Innocent purchaser for value. The decree of registration shall not be reopened or revised by reason of absence, minority, or other disability of any person adversely affected thereby, nor by any proceeding in any court for reversing judgments, subject, however, to the right of any person, including the government and the branches thereof, deprived of land or of any estate or interest therein by such adjudication or confirmation of title obtained by actual fraud, to file in the proper Court of First Instance a petition for reopening and review of the decree of registration not later than one year from and after the date of the entry of such decree of registration, but in no case shall such petition be entertained by the court where an innocent purchaser for value has acquired the land or an interest therein, whose rights may be prejudiced. Whenever the phrase “innocent purchaser for value” or an equivalent phrase occurs in this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other encumbrancer for value.”

And:

“Upon the expiration of said period of one year, the decree of registration and the certificate of title issued shall become incontrovertible. Any person aggrieved by such decree of registration in any case may pursue his remedy by action for damages against the applicant or any other persons responsible for the fraud.” [2]P.D. No. 1529, supra.

Therefore, it is clear under the cited law that the real and true owner can still question the decree of registration, within ONE (1) YEARfrom and after the date of the entry of such decree of registration”.

After the lapse of one (1), the real owner cannot anymore question or assail the decree of registration because “upon the expiration of said period of one year, the decree of registration and the certificate of title issued shall become incontrovertible.

After One [1] Year, What is next? 

What will happen if the real and true owner fails to learn about the fact of registration and the decree of registration itself during that one [1] year prescribed period to review such decree?

Would it mean that the real or actual owner does not have anymore legal remedy or action to recover his property against the pretender?

Fortunately, there are still legal recourse provided by law. One is recovery of damages from the Assurance Fund if the real property has already been transferred to an “innocent purchaser for value” by, at the very least, the perpetrator of fraud.

An innocent purchaser for value refers to the buyer of the property who pays for its full and fair price without or before notice of another person’s right or interest in it. He or she buys the property believing that “the [seller] [i]s the owner and could [transfer] the title to the property.” [3]Sps. Aboitiz v. Sps. Po, G.R. No. 208450 and 208497, June 5, 2017

On the other hand, the real owner, if there is no innocent purchaser for value that will be affected, can still recover the land through an Action for Reconveyance or, specifically, Accion Reinvindicatoria or Reinvindicatory Action.

What is an Action for Reconveyance? | Reinvindicatory Action

In the event that the real and actual owner is still unsuccessful in utilizing to his advantage the remedy of review of registration decree within a period of one year reckoned from the time stated above, he can still file an ordinary civil action for the recovery of real estate’s ownership, provided it has not yet been validly conveyed to an innocent purchaser for value. This is an action for reconveyance.

Thus:

“A complaint for reconveyance is an action which admits the registration of title of another party but claims that such registration was erroneous or wrongful. It seeks the transfer of the title to the rightful and legal owner, or to the party who has a superior right over it, without prejudice to innocent purchasers in good faith. It seeks the transfer of a title issued in a valid proceeding. The relief prayed for may be granted on the basis of intrinsic fraud-fraud committed on the true owner instead of fraud committed on the procedure amounting to lack of jurisdiction.” [4]Sps. Aboitiz v. Sps. Po, supra.

In this proceedings [action for reconveyance], evidence of ownership must be presented, established, and proved. This action is not absolutely concerned with the technical descriptions of the property described in the certificate of title.

Action for reconveyance deals mainly on establishing and proving ownership over a particular and specific real property.

Time Frame within which to File the Action for Reconveyance

The aggrieved party, who is the real owner of the property, has a period of TEN [10] YEARS from the time the defrauding party repudiates the ownership of the real owner, which is from the time the former registers the land.

When the defrauding party repudiates the ownership and successfully registers the land [Torrens system] in his name, he created an implied trust in favor of the owner. Consequently: [5]Sps. Aboitiz v. Sps. Po, supra.

“An action for reconveyance based on implied or constructive trust prescribes in ten years from the alleged fraudulent registration or date of issuance of the certificate of title over the property.

“It is now well-settled that the prescriptive period to recover property obtained by fraud or mistake, giving rise to an implied trust under Art. 1456 of the Civil Code, is 10 years pursuant to Art. 1144. This ten year prescriptive period begins to run from the date the adverse party repudiates the implied trust, which repudiation takes place when the adverse party registers the land.” [6]Sps. Aboitiz v. Sps. Po, supra.

When is Annulment of Title or Cancellation of Title a proper remedy, and when it is not?

In order to arrive at a better answer, we need to distinguish nature of the proceedings from which this remedy may be proper.

When an Annulment of Title or Cancellation of Title is filed within the one year period from the date the decree of registration has been entered, it will be treated as a Petition for the Review of the Decree of Registration. It is cognizable by the Regional Trial Court acting as a Land Registration Court. It is allowed under Section 32 of Presidential Decree No. 1529. Thus:

An action for annulment of title questions the validity of the title because of lack of due process of law. There is an allegation of nullity in the procedure and thus the invalidity of the title that is issued. [7]Sps. Aboitiz v. Sps. Po, supra.

In another situation, when an action for Annulment of Title or Cancellation of Title is utilized after that one year period, we still have to find out whether the legal recourse is one for the recovery of ownership or only assailing the correctness and the questionable issuance of the certificate of title for want of due process, in order to sustain or dismiss the same.

Thus, when filed for the purpose of recovering ownership, it is a reinvindicatory action, covered by the Rules on Ordinary Civil Action, which prescribes in 10 years from the fact of registration on the basis of an implied trust that is created in favor of the real owner and aggrieved party. This is subject to the payment of the corresponding filing fee based on its value, whether zonal, market, or assessed, whichever is higher.

Suggestion: The case must be “Action Reinvindicatoria with Prayer for Annulment or Cancellation of Title” or “Recovery of Ownership / Action for Reconveyance with Prayer for Annulment or Cancellation of Title“. The main cause of action should be recovery of ownership and the consequential prayer is annulment or cancellation of title.

Yet, when Annulment of Title or Cancellation of Title is chosen as legal recourse to assail the certificate of title itself, the descriptions, and transcriptions contained therein as incorrect, it must be filed within one (1) year from the time the decree of registration has been entered.

By then, it will be treated as a Petition for Review of the Decree of Registration.

If not filed within the period allowed, such action is now barred by the Statute of Limitations, therefore, not sustainable but dismissible. In this case, action for reconveyance is the proper remedy.

References

References
1 Section 32, Presidential Decree No. 1529
2 P.D. No. 1529, supra.
3 Sps. Aboitiz v. Sps. Po, G.R. No. 208450 and 208497, June 5, 2017
4 Sps. Aboitiz v. Sps. Po, supra.
5 Sps. Aboitiz v. Sps. Po, supra.
6 Sps. Aboitiz v. Sps. Po, supra.
7 Sps. Aboitiz v. Sps. Po, supra.
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