“Torrens System Does Not Vest Title”
Respondents filed an action for quieting of title over a parcel of land denominated as Lot No. 666. According to respondents, the said lot belonged originally to Claudio Ermac and after his death, was inherited by his children — Esteban, Pedro and Balbina. Pedro and Balbina requested their brother Esteban to have their title over the property registered.
Esteban, however, was unable to do so, and the task of registration fell to his son, Clemente. Clemente, however, applied for registration of the title in his own name. Respondents claimed ownership over the portions of the said lot either by right of succession or by purchase from the heirs of Claudio Ermac.
Allegedly, their ownership and possession had been peaceful and undisturbed, until recently when petitioner- heirs of Clemente Ermac filed an action for ejectment against them. Petitioners denied the material allegations of the respondents and set up the defense of prescription and laches. The trial court decided for the respondents. Its decision was affirmed by the Court of Appeals.
Who filed with the Supreme Court? Heirs of Clemente
Prayer: That the certificate of title issued in favor of their predecessor-in-interest, Clemente Ermac
Reason: It became incontrovertible after the lapse of one year from its issuance. Hence, it can no longer be challenged.
Can Torrens System and laches be used as a defense? No.
TORRENS SYSTEM NOT FOR FRAUD. SC: It is true that Section 32 of the Property Registration Decree provides that the decree of registration becomes incontrovertible after a year, it DOES NOT altogether deprive an aggrieved party of a remedy in law. The acceptability of the Torrens System would be impaired, if it is utilized to perpetuate fraud against the real owners.
LACHES NOT TO BE USED FOR FRAUD. Moreover, the doctrine of laches cannot be used to defeat justice or to perpetuate fraud and injustice. Its application should not prevent the rightful owners of a property to recover what has been fraudulently registered in the name of another.
Is ownership the same as certificate of title? No.
OWNERSHIP IS NOT THE SAME AS TORRENS TITLE HOLDING. Furthermore, ownership is not the same as a certificate of title. Registering a piece of land under the Torrens System does not create or vest title, because registration is not a mode of acquiring ownership. A certificate of title is merely an evidence of ownership or title over the particular property described therein. Its issuance in favor of a particular person does not foreclose the possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held in trust for another person by the registered owner.
What is held of the title holder if it is established that the defrauded party is the owner? A holder of trust for the heirs of the latter.
TITLE HOLDER CAN BE HOLDER OF TRUST FOR THE OWNER. The Court further ruled that when a party uses fraud or concealment to obtain a certificate of title to property, a constructive trust is created in favor of the defrauded party. Since Claudio Ermac has already been established as the original owner of the land, the registration in the name of Clemente Ermac meant that the latter held the land in trust for all the heirs of the former. Since respondents were in actual possession of the property, their action to enforce the trust, and recover the property, and thereby quiet title thereto, does not prescribe.
Accordingly, the Court denied the petition.