GR 129977; (February, 2001) (Digest)
G.R. No. 129977 . February 1, 2001.
JOSELITO VILLEGAS and DOMINGA VILLEGAS, petitioners, vs. COURT OF APPEALS and FORTUNE TOBACCO CORPORATION, respondents.
FACTS
The property, Lot B-3-A, was originally registered under TCT No. 68641 in the names of Ciriaco Andres and Henson Caigas. On September 6, 1973, they sold it to Fortune Tobacco Corporation (Fortune), and TCT No. T-68737 was issued in Fortune’s name. The vendors executed a joint affidavit stating the land had no tenants. Subsequently, on August 6, 1976, Andres and Caigas executed a Deed of Reconveyance of the same lot in favor of Filomena Domingo, mother of petitioner Joselito Villegas. This deed was registered, and TCT No. T-91864 was issued to Domingo. Later, Domingo sold a portion to Villegas, who obtained his own title. Fortune’s original title was lost in a fire in 1976. In 1991, upon Fortune’s petition, the trial court ordered the reconstitution of its lost title (TCT No. T-68737). Fortune then filed a complaint for recovery of possession against the Villegases.
ISSUE
The primary issues are: (1) Who between the parties has a valid title to the property? and (2) Is Fortune’s action barred by laches?
RULING
The Supreme Court reversed the Court of Appeals and ruled in favor of the Villegases, dismissing Fortune’s complaint. The Court found Fortune’s reconstituted title void. The reconstitution was judicial, but the order was issued by the trial court in 1991 based solely on a certification from the Register of Deeds, without the mandatory judicial proceedings required under Republic Act No. 26 . The law mandates a special procedure including publication, notice to interested parties, and hearing. Here, the reconstitution was granted ex parte, rendering the resulting title void and of no legal effect. A void title cannot be a source of right.
Furthermore, the Court held that laches had barred Fortune’s claim. The elements of laches were present: Fortune’s title was issued in 1973, but it filed its complaint only in 1991. For 18 years, Fortune took no overt action to assert ownership against the Villegases and their predecessor, Domingo, who were in open, continuous, and notorious possession. Fortune failed to prove any earlier demand or protest. This unreasonable delay prejudiced the Villegases, who built their households on the land. Thus, even assuming a valid title, Fortune’s right to recover was extinguished by laches.