G.R. No. 100374-75 - Luna vs. Court of Appeals

Bulawan filed a complaint for annulment of title, reconveyance, and damages on March 1, 1995, against Lourdes Yap and the Register of Deeds in Civil Case No. 9040.
The trial court rendered a decision on November 26, 1996, ruling in favor of Bulawan by declaring that she was the lawful owner and possessor of Lot No. 1634-B of Psd-153847, annulled certain titles (including TCT No. 40292 issued in Yap’s name), and canceled the subdivision plan Psd-187165.
The decision also ordered Yap to pay Bulawan attorney’s fees, litigation expenses, and costs.
Yap appealed the verdict, and the Court of Appeals dismissed her appeal on July 20, 2001.
The trial court’s decision became final and executory on February 7, 2002, with subsequent issuance of a writ of execution on July 19, 2002.

On July 24, 2002, the Register of Deeds informed Aquende about the writ of execution, requiring him to present TCT No. 40067 for annotation of a lien.
Aquende, unaware of any litigation or adverse notice on his title, questioned the writ and filed a Third Party Claim on August 2, 2002, arguing that he was not a party to the case and that the trial court decision should not bind him.
Following the Clerk of Court’s letter on August 5, 2002 indicating that his remedy should not be through a Third Party Claim since no levy or seizure had been effected on his property, Aquende proceeded to file a Notice of Appearance with Third Party Motion.
He sought the partial annulment of the trial court’s decision—specifically, the cancellation order pertaining to Psd-187165 and certificates of title issued under it.
The trial court issued an Order on February 19, 2003, denying Aquende’s motions. Aquende then filed a petition for annulment of judgment with the Court of Appeals, alleging extrinsic fraud and lack of jurisdiction since he was not properly impleaded in the case.

Aquende claimed that Bulawan’s failure to implead him, combined with the trial court’s subsequent decision, resulted in extrinsic fraud and a departure from due process, thereby depriving him of the opportunity to present his case regarding his title over the property.
He further argued that the trial court exceeded its jurisdiction because Bulawan did not specifically pray for the cancellation of Psd-187165 and TCT No. 40067.
Despite the initial favorable decision rendered to Bulawan on November 26, 1996, the petition for annulment was advanced by Aquende on grounds that the judgment adversely affected his property rights.

In its November 26, 2007 Decision, the Court of Appeals ruled in favor of Aquende by declaring the trial court’s November 26, 1996 Decision null and void due to non-impleading of Aquende as an indispensable party and lack of jurisdiction over his person.
The decision reinstated TCT No. 40067 in Aquende’s name as well as the previously canceled Psd-187165, ordering the deletion of annotations on TCT No. 40067 reflecting the erroneous cancellation.
The resolution further directed that parties respect a prior decision (from October 31, 1990 in Civil Case No. 5064) regarding the quieting of title over Lot No. 1634-B.

Bulawan filed a motion for reconsideration on January 8, 2008.
The Court of Appeals denied her motion on May 7, 2008, upholding their earlier decisions.
The petition for review was thus advanced, leading to the present case.

Whether the annulment of the trial court’s November 26, 1996 Decision is proper given that a petition for annulment under Rule 47 of the Rules of Court is an equitable remedy available only under extraordinary circumstances.
Whether it was correct for the Court of Appeals to consider Emerson B. Aquende as an indispensable party in Civil Case No. 9040, and whether his non-impleader deprived him of the opportunity to protect his property rights.
Whether the Court of Appeals erred in annulling a final and executory decision previously affirmed by another division of the Court of Appeals, thereby departing from the accepted course of judicial proceedings.