G.R. No. L-30546 June 30, 1988
VARSITY HILLS, INC., et al., petitioners, vs. HON. HERMINIO C. MARIANO, Judge of the Court of First Instance of Rizal, ELPIDIO TIBURCIO, et al., respondents.

FACTS

Private respondents, the Tiburcios and others, filed Civil Case No. 5572 seeking the annulment of Original Certificate of Title Nos. 730 and 735 in the names of the Tuasons and subsequent Transfer Certificates of Title issued to Varsity Hills, Inc., the University of the Philippines (UP), and the People’s Homesite and Housing Corporation (PHHC). They alleged these titles were fictitious and issued in violation of Act No. 496 . The defendants, including petitioners Varsity Hills, Inc. and the Tuasons, filed motions to dismiss on multiple grounds, including that the cause of action was barred by prior judgment and by laches. The respondent judge initially denied the motions regarding venue and jurisdiction and held others in abeyance.
This land dispute had a extensive litigation history. In a prior case, G.R. No. L-13479 (Tiburcio vs. PHHC, et al.), involving the same land, parties, and cause of action, the Supreme Court had already ruled that the land was registered under the Torrens system in 1914. The Court held that the plaintiffs’ action, filed decades later, was barred as a decree of registration can only be challenged on grounds of fraud within one year, provided no innocent purchaser for value has intervened. This ruling was reiterated in subsequent cases, including G.R. No. L-24114, which specifically involved orders from Civil Case No. 5572 and affirmed the dismissal of the complaint against UP and PHHC.

ISSUE

Whether the respondent judge committed grave abuse of discretion in not dismissing Civil Case No. 5572 against petitioners Varsity Hills, Inc. and the Tuasons.

RULING

Yes. The Supreme Court granted the petition, annulling the challenged orders. The legal logic is anchored on the principles of res judicata and laches. Although petitioners were not named parties in the prior Supreme Court cases (L-13479, L-15644, and L-24114), they are direct successors-in-interest of the Tuasons, from whom UP and PHHC also derived their titles. Following the precedent in Manalo v. Mariano, res judicata applies as petitioners are privies to the original party litigants. The core issue of ownership and title validity over the same property has been “thrice settled definitely and conclusively” by the Court.
Furthermore, the defense of laches is conclusively established. The original certificates were issued in 1915, yet private respondents filed the present action in 1959, sleeping on their rights for over forty years. The Court had consistently declared in the prior related cases that the Tiburcios’ cause of action had prescribed and they were guilty of laches. Therefore, allowing Civil Case No. 5572 to proceed would sanction the re-litigation of definitively settled issues, which is impermissible. The respondent judge’s refusal to dismiss the case constituted grave abuse of discretion. The preliminary injunction was made permanent.